4.1. Reference interconnection offer (RIO)

In 2012, ICP-ANACOM continued to work on the definition of a simplified costing model for the billing, collection and non-collection risk services, number portability activation service and pre-selection activation service. Therefore no changes were made to the RIO.

4.1.1. Call origination and termination prices

The prices of the Reference Interconnection Offer (RIO), applying to call origination and termination on the fixed network, remained unchanged in 2012, since it was decided not to amend prices until after conducting analysis of the wholesale market for call origination and termination on fixed networks. Accordingly, in 2012 an analysis was continued up with regard to the definition of the relevant markets, identification of SMP operators and imposition, amendment or withdrawal of ex ante regulatory obligations, including the obligation to control prices; in the case of the terminations market, this analysis must take into account the EC Recommendation on termination prices¹.

As illustrated in the following graphs, where termination and origination prices are compared in several countries at various levels for incumbent operators as on 31 December 2012, prices in Portugal remained very close the EU average when considering the Member States of the EU15.

Graph 3. European comparisons - fixed interconnection prices (call origination and termination)

Prices in Portugal remained very close the EU average when considering the Member States of the EU15.

Source: ICP-ANACOM calculations based on information from Cullen International.

As can be seen, the maximum prices in force in 2012 for single tandem and double tandem compare favourably with the EU average (simple EU average and EU average excluding extremes) for different periods. If local traffic is considered, as in previous years, the maximum prices in force in 2012 were above the EU average - see the table below, which summarizes the deviations between prices in Portugal and average prices in the EU15.

**Table 2. Comparison of interconnection prices prevailing in 2012 with prices practised in the EU15 (price per minute for a three-minute call - values in eurocents excluding VAT)**
	Origination
	Local		Single tandem		Double tandem
	Peak	Off-peak	Peak	Off-peak	Peak	Off-peak
Prices in RIO 2012	0.54	0.35	0.67	0.42	0.78	0.49
EU average (ex PT)	0.46	0.31	0.83	0.62	0.96	0.58
Deviation RIO 2012 from average	16.4%	12.6%	-19.1%	-31.9%	-18.6%	-15.9%

Source: ICP-ANACOM calculations based on information from Cullen International.

**Continuation. Table 2. Comparison of interconnection prices prevailing in 2012 with prices practised in the EU15 (price per minute for a three-minute call - values in eurocents excluding VAT)**
	Termination
	Local		Single tandem		Double tandem
	Peak	Off-peak	Peak	Off-peak	Peak	Off-peak
Prices in RIO 2012	0.54	0.35	0.67	0.42	0.78	0.49
EU average (ex PT)	0.43	0.30	0.83	0.60	1.06	0.64
Deviation RIO 2012 from average	26.8%	18.0%	-18.9%	-30.6%	-26.5%	-23.1%

Source: ICP-ANACOM calculations based on information from Cullen International.

4.1.2. Pricing of the service of billing, collection and non-collection risk, the pre-selection activation service and the number portability activation service

In 2012, maximum prices of the pre-selection activation service, the number portability activation service and the service of billing, collection and non-collection risk were maintained. Furthermore, the consultancy project being conducted on these services was continued, seeking the development of a simplified costing model for each service. This project stems from many situations, including: i) the occurrence of significant variations in costs and/or quantities, resulting in both cases, in significant unit cost variations, ii) the importance of providing the market with predictability and iii) the methodology of analysis applied in reviews of the RIO, as used for a considerable time. The project therefore aims to rectify the flaws which have been identified through the development of simplified models to determine the maximum prices for the service of billing, collection and non-collection risk, the pre-selection activation service and the number portability activation service.

Notes

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¹ In relation to the wholesale market for call termination, in 2013, approval was given to the draft decision determining a decrease in individual fixed network termination rates to 0.1091 eurocents per minute (with effect from October 2013). This price was set based on a comparison with the values determined by national regulatory authorities which have notified the EC as to termination rates obtained based on ''pure'' LRIC costing models, i.e., in accordance with the EC Recommendation of 7 May 2009 on the Regulatory Treatment of Fixed and Mobile Termination Rates in the EU (2009/396/EC).