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Panama will continue blocking VOIP
13 November 2002 – According to a Reuters report, Panama is standing by its October 25 decision to block Internet-based calling in order to protect the telecommunications exclusivity granted to Cable & Wireless, which lasts until 2003.
The decision forced Panama's nine Internet service providers to block access to programs that route calls to data networks. Alex Arroyo, president of the Public Services Regulator, said the order will be maintained once Panama deregulates its telecommunications sector next year.
"Phone companies that wish to operate in Panama must pay taxes and respect our concessionary rules," Arroyo told Reuters in an interview.
Service providers who disregard the blockage order could be fined as much as US$ 1 million, Arroyo said. By using VOIP, Internet-based providers avoid paying a $1 toll tax on each call. Arroyo said one provider, Net2Phone, has carried over 1 million minutes of long-distance calls this year.
"This is a clear example of tax evasion," Arroyo said.
Bell South, Tricom, Broadband Wireless and Galaxy Communication are among 16 companies expected to offer telecommunications services in Panama next year.
Cable & Wireless said it was losing money because of Internet telephony, but did not say if it had lobbied the regulator to implement the blockage. Cable & Wireless charges as much as $1.90 per minute for calls to the UK from Panama. Net2Phone charges only $0.05 a minute.
Panama's ruling is similar to others being considered by governments in South Africa and Yugoslavia. India and China have even imprisoned Internet phone providers in the past.
Internet-based calling accounted for 6% of total voice traffic in 2001 and will make up about 10% this year, according to research firm TeleGeography Inc.
"It's ultimately a futile attempt to stop the inevitable," said Richard Shockey, director of strategic technologies for Sterling, Virginia-based NeuStar Inc. when asked about Panama’s decision.
Net2Phone said it does not intend to appeal the decision, but might apply for a license to operate in Panama's deregulated market next year. |
