Cellphone users to benefit from move by Icasa

2009-10-17 10:07

CONSUMERS are likely to be “free” rather than “dom” and will really

“Ringa Waya Waya” should the Independent Communication Authority of South Africa

(Icasa) suceed in controlling interconnection fees amongst cellphone and

fixed-line operators.

Communication Minister Siphiwe Nyanda has already issued a

directive that Icasa should lower the interconnection rates before the end of

the month.

An interconnection fee is a charge that cellphone companies impose

on consumers for connecting to rival networks.

They also do not want to reveal how much it costs them to carry

calls on each others networks.

Companies charge callers a flat rate of R1.25 per call per minute

on calls to rival networks.

Cellphone operators refused to divulge the actual cost of a call

before interconnection fees are added.

But City Press found that should Icasa get its way, consumers will

save at least 50% on calls.

Currently a three minutes call from Cell C to Vodacom during peak

hours costs R9,07.

If interconnection rates are cut to 60 cents, as Icasa is

proposing, about R4,32 of the R9,07 will go back to the customer.

Vodacom head of communications Nicolene Visser said they are in

favour of a gradual reduction in interconnection costs.

MTN’s general manager for regulatory affairs, Graham de Vries, said

they were not opposed to Icasa’s proposal but it should be introduced gradually

as cost reductions would affect the firm’s entire business model.

Cell C spokesperson Vinny Santu said they supported the cut and

wanted Icasa to implement the directive immediately.

“Cell C would like the (reduced) interconnection rates to come into

effect as soon as is practically possible and remain so for three years after

which rates will be determined on a cost basis,” she said.

Paris Mashile, chairperson of Icasa said they hoped to move quickly

with the implementation of the directive.

He said the presentations to Parliament by cellphone companies did

not do them any favours because they admitted to subsidising each other.

“The minute you subsidise one another you are admitting to

anti-competitive measures. But we are still asking them to come on board and cut

the interconnection fees,” said Mashile.

Ishmael Vadi, chairperson of the portfolio committe on

communications said committee members would meet on Tuesday to finalise what

their next step would be.


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