Vodacom holds the line as fury mounts
VODACOM is not backing down from its plan to hike tariffs on its voice and data contracts — even though the National Consumer Commission has launched a probe into the case.
The row has escalated since Vodacom told subscribers last week that it would raise tariffs from May 1. Irate customers asked on social media sites how it was that Vodacom could sign twoyear contracts, then unilaterally change the terms and hike its prices.
The commission will also look into Cell C, which made a similar announcement, after receiving three complaints.
Trevor Hattingh, the commission spokesman, said this week that depending on what the authority found, it could broaden the scope of its inquiry to other mobile operators as well as fixedline service providers.
It will focus on checking that unilateral price increases are in line with what customers signed up for when they took out the contracts.
“We are aware that many other consumers are affected by the actions of the mobile network service providers concerned,” Hattingh said.
In one instance, the price of a broadband package will increase by as much as 10%, affecting consumers on fixed-term contracts.
Although
Hattingh DEFIANT: Vodacom says its data contract rates will go up on May 1 as planned would not comment on the details of the inquiry, it is believed that section 48 of the Consumer Protection Act, which prohibits a supplier from entering into an agreement with a consumer on terms that are unfair, unjust or unreasonable, may have been breached.
But Vodacom argued that its contract terms provided for the “right to vary our charges from time to time” and this was compliant with the act.
“As things currently stand, the plan is still to implement the increases as of May 1,” Vodacom spokesman Richard Boorman said on Thursday.
Cell C, which advised customers last December that it would increase contract and prepaid tariffs from February, also maintained its contracts complied with the act.
At this stage the operators had done no wrong, said the Independent Communications Authority of SA (Icasa), which directly regulates the telecoms sector.
Icasa and the National Consumer Commission have been at loggerheads previously over which agency regulates cellular network operators, but they are now trying to iron out their differences.
Icasa spokesman Paseka Maleka said: “The licensees are free to set their retail tariffs within the constraints of the competitive environment.”
Icasa decided to first regulate the price of wholesale bottleneck services, such as call termination rates, which it lowered last year.
These fees are what operators charge to carry calls on each other’s networks.
This lowering of the fees — in favour of a more competitive environment for smaller operators and price competition to benefit consumers — has hit revenue for large operators Vodacom and MTN.