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Communications266

Calculating the Price of Electronic Communications Services in Lithuania

Loreta Kalvaitien, Chief Specialist, Strategic Planning Division, Communications Regulatory Authority of the Republic of Lithuania
Julija Ivanova, Chief Specialist, Cost Accounting and Statistics Division, Communications Regulatory Authority of the Republic of Lithuania

On 1 October 2007, electronic communications service price comparison website www.skaiciuok.lt intended for users was launched. The price calculator helps users to choose electronic communications service providers offer, which best satisfy their needs in terms of the most attractive prices of electronic communications services.



WHAT IS THE AIM OF THIS PROJECT IN LITHUANIA?

Intense competition in the market of electronic communications services provided users with possibilities to use voice telephony services provided over mobile communication, fixed communication and Internet networks.  Mobile communication and VoIP (IP-based voice telephony) services have become an alternative to fixed telephony.  Operators and service providers offer many different payment plans, which are based on various pricing concepts.
When making decisions which payment plan to choose, users are often influenced by family members, friends and advertising. However, due to a large variety of offers and different schematic constructions, users get only partial information; therefore, quite often their decisions are not optimal ones.
In response to this, in October 2007, the Communications Regulatory Authority of the Republic of Lithuania (further-RRT) created an electronic communications service price comparison system, or price calculator, thus seeking to provide users, in a quick, simple and universally accessible way, with more information about the prices of services provided over public telephone networks.  The calculator is available on the website www.skaiciuok.lt. It helps users to choose the most attractive electronic communications service prices on the basis of their needs.  It also helps people to more efficiently plan their expenses on such services both in Lithuania and abroad.  The calculator, which gave greater transparency in pricing of the retail services market, has a positive effect on competition among operators and service providers.

Figure 1. Electronic communications service price comparison website www.skaiciuok.lt. Source: RRT

EXPERIENCE OF REGULATORS OF OTHER COUNTRIES

Before starting creating the price calculator, websites of other countries, which have calculators operating on the basis of similar principles, were reviewed and analysed, in order to use best practice and create such price calculator, which would satisfy Lithuanian users needs and which was precise, simple and easy to use.  National regulators in Norway, Sweden, Denmark, Estonia, Ireland, Hungary and other countries have also implemented price calculator projects.  In the majority of those countries, price calculators include comparison of prices of fixed, mobile communication and Internet services.  For calculation, publicly available data of payment plans for private consumers are used..  It should be noted that not all countries offer calculators in both their national language and in English, and not all of them offer price comparisons for roaming services.

Figure 2. Four ways of comparing fixed communication service prices on price calculator website www.skaiciuok.lt. Source: RRT

WHAT IS PRICE COMPARISON SYSTEM LIKE IN LITHUANIA?

Price calculator in Lithuania covers fixed and mobile telephone communication and is intended for private users.  Users, after entering data on the services they use and after price calculator automatically generates results, can choose the payment plan or electronic communications service provider that best meet their needs. The price calculator can compare the prices of fixed and mobile telephone communication, Internet telephony (VoIP), roaming services, SMS and MMS messages, and general radio packet service (GPRS).
The service prices can be compared in four different ways fast, basic, advanced and detailed.

Figure 3. Four ways of comparing mobile communication service prices on price calculator website www.skaiciuok.lt. Source: RRT

            Those who simply wish to compare service tariffs can use the fast price comparison; while those who would like to get more detailed information about plans offered by service providers or prices, should use basic, advanced and detailed comparison.  The accuracy of the results will vary on the basis of the type of comparison is chosen.  The calculation algorithm of the advanced comparison makes it possible to more accurately evaluate and compare payment plans which allow using voice and data transmission services of certain volume for a fixed (minimum) service fee.  The result will be most accurate if the detailed comparison is chosen. It allows users to calculate their expenses after they enter a detailed service bill into the system.  The bill must have .xls or .txt format.

Table 1. Features of the four options of the electronic communications service price comparison system. Source: RRT

            The results of the price calculator are of an informative nature and depend on the accuracy of the information that is entered by the user.  The results are presented in the order of preference.  First, the lowest tariffs offered by the operators and service providers in a certain group of tariffs are presented.  Then the results are arranged in ascending order.  The calculations do not include data of payment plans which are available only to legal entities. Also, they do not cover additional privileges that are offered by service providers (e.g., free calls in ones own network or circle of friends, bonuses for answered calls, rewards for loyal customers etc.).  The information is found in a result calculation table, next to the name of the specific payment plan, i. e. reference made to the web site of service providers, where more detailed information can be found.

Figure 4. An example of the table which shows the results provided by price calculator on the website www.skaiciuok.lt. Source: RRT

The website of the price calculator also provides news and information about various issues related to electronic communications service prices.  A FAQ section offers answers to the most frequently asked questions; users are also encouraged to pose their own questions and receive answers.  The calculator is available both in the Lithuanian and in English languages.  During the first month of operation, the calculator was visited by more than 18,000 people.  Approximately 1,500 people visit the price calculator website www.skaiciuok.lt per month.
Seeking to raise awareness of electronic communications service users and encourage competition amongst service providers of Lithuania, in the nearest future RRT is going to improve the price calculator and add Internet service price comparison so that the calculator was relevant, informative and simple to use and would help users not to get lost amongst the variety of the offered payment plans and find the most satisfactory one.


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eBaltics
18.12.2017


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