In accordance with regulatory requirements, Swisscom has been offering cost-oriented interconnection charges calculated using the LRIC method since the year 2000. Depending on the individual service being offered, the new calculation for the year 2002 will lead to an average price reduction of 6 per cent. The prices contain the relevant interconnection charges only, but no profit margin. The method used by Swisscom is based on international experience and empirical data.
The changeover by Swisscom from three rates to two is in line with the international price structure trend and combines the former off-peak and night-time rates to form a new off-peak rate. The resulting average price reduction for alternative providers will vary depending on individual traffic distribution and for all providers will average out at around 6 per cent.
Interconnection prices differ according to service and usage. Based on effective traffic distribution (standard rate 36%, off-peak rate 64%) and an average call duration of four minutes, the average price for regional termination in the year 2002 will be 1.43 cents per minute.