The CTU sector regulator yesterday at last announced the new maximum fixed-to-mobile and mobile-to-mobile interconnection price, at CZK 3.66 per minute. This outcome is favorable for Cesky Telecom, in our view (though CT had sought CZK 3 per minute), and bad news for RadioMobil and Eurotel (who were seeking some CZK 5 per minute and who yesterday criticized the decision). The reduction will allow Cesky Telecom to maintain its July reduction in fixed-to-mobile prices for end-user customers, which is in turn important for Telecom’s stemming of the cannibalization of fixed-line traffic by mobile networks. The impact on consolidated Cesky Telecom performance will be diluted by the fact that Eurotel (51% owned by CT) is on the other side of the dispute, but the net impact will still be positive. However, the news did not help Cesky Telecom yesterday, partially because a similar reduction was expected.
(Ondrej Datka)