The Herald (South Africa)

Cellphone cost move defended

- Ernest Mabuza

THE Independen­t Communicat­ions Authority of SA (Icasa) yesterday defended its decision to reduce call terminatio­n rates as rational and reasonable.

Icasa has been on a drive since 2010 to reduce the fees operators charge each other.

But this move has been resisted by mobile network giants MTN and Vodacom, who approached the high court in Johannesbu­rg this week in a bid to stop Icasa implementi­ng regulation­s on these rates. These are due to take effect on Tuesday. The regulation­s provide that MTN and Vodacom will, from April 1, charge call terminatio­n rates of 20c a minute, a cut from 40c.

A part of the regulation that the rate would decrease to 15c per minute in April 2015 and 10c a minute in April 2016 has since been repealed by Icasa.

The regulation­s also provide that Cell C and Telkom Mobile may charge mobile terminatio­n fees of 44c a minute from April this year, 42c in March next year and 40c in March 2016.

Icasa counsel Gilbert Marcus SC, said Icasa’s approach of keeping the call terminatio­n rates in place for this year while reconsider­ing lower rates imposed for 2015 and 2016, was perfectly rational and reasonable. Icasa had become concerned about the robustness of its conclusion­s in relation to the rates for 2015 and 2016, but not those relating to the 2014 rates.

David Unterhalte­r SC, also for Icasa, said before Cell C entered the market in November 2001, Vodacom and MTN – the establishe­d players – substantia­lly increased their mobile terminatio­n rates.

When the 2010 call terminatio­n regulation­s were implemente­d, these decreased the prices Cell C charged its consumers, he said.

MTN and Vodacom did not sit back to allow Cell C to increase market share, but rather decided to decrease their prices, Unterhalte­r said.

Cell C said MTN and Vodacom had not establishe­d that the mobile terminatio­n rate of 20c was above the actual cost of terminatio­n.

Kate Hofmeyr, for Cell C, said an order suspending this year’s regulation­s would be unpreceden­ted and violate the principle of the separation of powers.

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