Rates for local calls will increase from 0.09 litas to 0.12 litas ($0.0225 to $0.3) per minute during peak hours. The company has introduced new off-peak and night rates, at 0.08 litas and 0.04 litas per minute, respectively, to replace the existing general off-peak tariff of 0.05 litas, Lietuvos Telekomas' representatives told journalists.
The cost of intercity calls (within Lithuania) will remain unchanged at 0.37 litas per minute during peak hours. The current 0.19 litas off-peak rate will be replaced by two tariffs in early 2001 - 0.25 litas during off-peak hours and 0.12 litas at night.
The line rental fee for personal users will remain unchanged at 17 litas per month, whereas the monthly charge for business users will be lowered by 16 percent, from 36 litas to 30 litas.
The rates have been changed in accordance with a pricing formula set out in the telecommunications license which allows Lietuvos Telekomas to increase call rates by 10 percent plus the annual inflation rate.
Also, Lietuvos Telekomas is set to scrap a free hour of local calls per month, now offered to subscribers, which save about 90 million litas, Vytautas Plunksnis of the financial brokerage firm Jusu Tarpininkas said.
"Telekomas aims to get ready to face competition, and therefore we have to complete the process of tariff balancing ahead of the total liberalization of the market," said Tapio Paarma, Lietuvos Telekomas' general director. The company's state-guaranteed fixed-line telephone monopoly ends Dec. 31, 2002.
The new rates also mean that subscribers will pay more for Internet access if they continue using voice lines, especially during peak hours.
The good news is that rates for overseas calls to some 60 countries will drop, in some cases by up to 52 percent.
Telekomas also announced on Dec. 1 that it closed a deal with Swedish telecom giant Ericsson to install an advanced digital phone exchange in Kaunas, Lithuania's second largest city. This will mean an increase of 25,000 subscribers in the city. The level of digitization of phone lines in urban areas has increased from 17 percent in 1998 to almost 60 percent at present. It is expected to reach 100 percent in 2001.
Lithuania presently has about 1.275 million fixed-line telephone subscribers, according to the communications department at the Ministry of Transport.