Thumbs up at Icasa’s move to lower the cost of making phone calls

2010-04-17 09:38

BUSINESS and consumers have reacted positively to the news that the Independent Communications Authority of SA’s (Icasa) has proposed strategies to lower the cost of ­making calls.

On Friday afternoon Icasa ­released the draft regulations of call termination rates which recommended cellphone operators ­Vodacom, MTN and Cell C lower their interconnection fees to 65c a minute while the fixed-line operators were expected to drop their rates to 15c.

Members of the public will be ­given until June 2 to submit their proposals.

Interconnection rates are the fees mobile and fixed-line operators charge each other’s customers when they make calls to other networks.

Cellphone operators currently charge 89c while fixed-line operators charge 15c a minute.

The draft regulations expect the mobile network operators to further lower their rates to 40c in July 2012 and fixed-line operators will have to charge 10c.

The mobile interconnection ­industry is currently worth R11 billion a year while the fixed-line earns R2 billion a year.

National Consumer Forum chairperson Thami Bolani said the ­organisation supported the ­reduction of the interconnection rates.

“We hope that the reduction of ­interconnection fees will translate into the reduction of cellphone ­tariffs as they have been quite ­expensive,” said Bolani.

He cautioned that people should not get excited over the draft regulations as mobile network operators could not be trusted to lower the tariffs.

However, Africa Analysis cellphone analyst Dobek Pater differed with Bolani, saying the network ­operators will definitely pass the discounts on to their consumers.

Using Telkom as an example, ­Pater said the fixed-line operator has been charging consumers 35c less than it charged last year.

“This is positive news for consumers as the cellphone tariff will also be expected to come down.

“The consumers will now find it attractive to phone people on the networks of other cellphone operators,” he said.

“But the network operators should not expect to make more money as the consumers might spend the money they will save on other things,” he said.

Peggy Drodskie, the executive ­adviser to the chief executive of the SA Chamber of Commerce and ­Industry, said the costs of making calls were higher than in other countries and made the overheads of businesses very expensive.

“It is good for business that cellphone tariffs will be going down while other tariffs like property rates and electricity will be going up,” she said.


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