GST yesterday became the first competitor to file its proposed rates with the state Public Utilities Commission, and the company cited several areas where its offerings would better Hawaiian Tel's.
GST is proposing basic service at rates identical to what Hawaiian Tel now charges. But Hawaiian Tel's rates are scheduled to increase about 8 percent on an interim basis Sept. 1 and even more at a later date if the utility gets a proposed increase approved.
Not only will GST's rates be at least 8 percent cheaper, but the company's basic service will include touch-tone dialing - a feature for which Hawaiian Tel charges $1.65 a month, said Rob Volker, GST vice president and general manager in Hawaii.
Hawaiian Tel spokesman Calvin Tadaki said the company didn't think it was appropriate to comment on GST's filing until the PUC makes a decision. But he said Hawaiian Tel welcomes competition as long as the rules are fair to all companies.
If GST gets commission approval, it initially will be able to offer local service only in areas of Oahu, Maui, Kauai, the Big Island and Molokai where it currently provides private-line services to office buildings.
Volker wants to offer that local service by early October.
Once issues are resolved about what Hawaiian Tel will charge competitors to lease space on its network, so they can resell service to customers, GST intends to offer full-fledged local service throughout the state, using facilities of both companies, Volker said. He is hoping that will happen by November, though other industry officials believe resolving the resell issues will take longer.
Eventually GST plans to offer local service primarily on its own network, he said.
AT&T, Sprint and Oceanic Communications also plan to get into the local market but they have yet to file proposed rates.
AT&T spokesman George Irion, however, said GST's filing is a good indicator of what's in store for phone customers.
"This shows how competition is going to bring benefits to the consumer," Irion said. "I think the direction (GST) is going down is very innovative and the kind of thing AT&T is pursuing."
Other carriers haven't announced rates partly because key issues remain unresolved in negotiations with GTE.
In that respect, GST is taking somewhat of gamble in announcing its rates now, not knowing what Hawaiian Tel will charge for certain services.
As part of yesterday's filing, GST proposed interisland rates that would be better than most of what's available currently.
The company wants to charge 10 cents per minute, good any time, any day, to any island, Volker said.
Hawaiian Tel and AT&T charge varying rates for day, evening and night calls, with the latter period having the cheapest charges: 14 cents for the first minute, 9 cents each additional minute.
Sprint charges two flat rates - 9 cents and 21 cents per minute - depending on the time and day.
"Customers really want a simple rate structure," Volker said. And for local service, "people are interested in having a choice."