Icasa probe set to lower cell tariffs

2013-06-08 00:00

BY early next year, South Africans could be paying less for cellphone calls and Internet data.

The Independent Communications Authority of SA (Icasa) announced yesterday that it would investigate the high cost of communications and probe whether there need to be new regulations to force costs down.

South African cellphone calls are among the most expensive in the world.

Out of 140 countries investigated, in only 23 are costs higher than here, according to Icasa research. South Africa tariffs are the fourth highest out of 34 African countries.

Arthur Goldstuck, the managing director of World Wide Worx, welcomed Icasa’s announcement.

“Many of the tariffs we pay are unjustifiable.

“Even for SMSes we are paying far too much. There is no basis for the high charges, because the true cost of an SMS is so little,” he said.

Communications Minister Dina Pule told Parliament last month urgent action was needed on the high costs of communication.

Pieter Grootes, Icasa’s managing director of markets and competition, said there is a general feeling among South Africans that call costs are too high.

“Our aim is not to set fixed cellphone tariffs, because we don’t want to interfere with competition in the market. What we want to do is to make sure the competition is genuine and that everyone rendering these services can do so under the same conditions, and this will bring about tariff reductions.”

Grootes said call-rate reductions could happen as early as March 1 and that Internet tariffs would follow.

Icasa licence holders, including cellphone networks, Telkom and the providers of telecommunications infrastructure, must report to Icasa from next week on precisely how they set their tariffs.

If a monopoly on infrastructure or any other part of the communications network is the cause of high prices, regulations would be instituted to drive prices down.

Not all networks are inclined to provide the requested details. At Icasa’s announcement, a representative of Telkom said this was sensitive information, which could lead to losses if leaked to competitors.

Grootes said all information would be treated in confidence and would not end up in the wrong hands.

Cell C CEO Alan Knott-Craig welcomed Icasa’s plans and said regulation is vital, especially for smaller networks like Cell C.

Vodacom and MTN said they support the process and will give their full co-operation on the understanding that Icasa would handle sensitive information appropriately.

Telkom had not responded to a request for comment by the time of going to press.

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