19 November 2012

Liberia: Lonestar Licenses Suspended

A V-SAT installation

Beginning 12 am on Dec. 3, LoneStar subscribers are expected to brace for the first ever inconvenience of being unable to make phone calls for three days, according to a blockage imposed by Liberia Telecommunications Authority (LTA), the regulatory body of cell phone companies in the country.

LTA suspended two operating licenses of LoneStar/MTN for its "unilateral implementation" of an authorized change the GSM Company reportedly carried out in the status of its interconnection with Comium/Liberia, another licensed GSM Company in the country, from May 2012 to 21 May, 2012.

Announcing the decision to journalists last Friday, LTA Board of Commissioners accused LoneStar of failing to untimely compliance with its directives.

The directives included the company's failure to restore fully by 5:00 PM, Monday, 21 May 2012, the interconnection between LoneStar and Comium Liberia, as it existed prior to LoneStar MTN's 18 May 2012 unilateral implementation of the unauthorized change; as well as LoneStar's recalcitrance, considering LoneStar Cell/MTN's previous unauthorized shutting of its interconnection link with another operator in 2012."

The decision came after several stakeholders' consultations between the LTA's Board and the LoneStar Cell/MTN Management.

"For purposes of this decision, suspension means that LoneStar Cell/MTN customers will be able to receive calls, but will not be able to make calls for the duration of the suspension period," LTA chairperson Agelique Weeks said.

To minimize the impact of the LTA's decision on customers in those areas in which only LoneStar Cell/MTN provides service, Ms Weeks explained: "said areas will be exempted from the suspension order such that those customers will be allowed to receive and make calls."

"However," she pointed out, "LoneStar Cell/MTN shall pay 25% of the revenues generated from such operations to the Government of Liberia (GOL)."

But LoneStar says: "The suspension as prescribed by the LTA presents many challenges even beyond technical. The impact financially and otherwise is much greater than we can fathom as it is tantamount to closing the business, shut the network, and in two weeks reopen to pick up the pieces."

LoneStar also said the loss of revenue on outgoing calls locally and internationally should not be underestimated. This will have such effect on the ultimate bottom line that it might affect the number of jobs in our employ, let alone the taxes due to the GoL. This loss could be in millions.

"The impact that this will have on our distributors and airtime agents will be huge as they are not able to sell airtime during that period. And, the ripple effect when they are not able to service their debts with the banks or with each other could create chaos for us. We have more than 300 sub - distributors that might want to bring stock back and to be refunded. This is disaster in our hands" LoneStar management lamented.

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