Czech government regulatory authority Czech Telecommunication
Office (CTO), decided that Paegas Internet Call, a recently launched Internet telephony service, is unlawful and has banned its service to customers.
The service was unveiled in October, and is run by Czech GSM operator Radiomobil. It is designed to offer discount international phone calls to mobile phone users. For instance, a call from the Czech Republic to the U.S. costs about 60 % of the standard price provided by Czech Telecom.
Czech Telecom filed a complaint against Radiomobil, citing that under Czech law it has a complete monopoly of long-distance telephone service until January 1, 2001. Radiomobil was found to be in violation of that monopoly agreement by the Czech Telecommunication Office.
Radiomobil can appeal the ruling of CTO, and is allowed to continue providing its controversial service until final decision is made. Some insiders predict the appeal process may last until Czech Telecom’s monopoly contract runs out.