Should mobile operators MTN and Vodacom’s legal challenge against the Independent Communications Authority of South Africa (Icasa) succeed in halting the imminent mobile termination rate (MTR) cuts, it could hamper attempts to further cut the cost of communication in South Africa.

Cell C chief legal officer Graham Mackinnon said on Thursday that, should the new glide path fail to go ahead, it was unlikely that South Africa’s third-largest operator could pursue further price cuts as the group might not be able to absorb the cost of the current MTRs.

“We will always be a consumer champion,” he averred; however, if the duopoly succeeded, it would be “difficult” to lower the call costs further.

Nearly a month before the March 1 implementation of the new rates, MTN served an urgent application to have the gazetted termination rate execution suspended as the group moved to review and set aside the new glide path. Vodacom emerged this month as a second challenger after filing its own suit against Icasa this week.

In response, Icasa postponed the implementation of the three-year glide path by one month.

The final termination rates, which largely favoured the smaller players, such as Cell C and Telkom Mobile, would see the rates charged to operators to carry calls between their networks halved to 20c this year, before declining to 15c in March 2015 and 10c by March 2016.

The asymmetry would be set at 44c, before declining to 42c in 2015, 40c in 2016 and 20c in 2017.

The two larger mobile operators, particularly MTN, attracted criticism for their aggressive opposition to the rate cuts, which were favoured by several industry players, including smaller rivals Telkom and Cell C.

The Right2Know Campaign on Thursday called on MTN and Vodacom to drop their court cases against Icasa “immediately”.

“This progressive pricing structure is an important step towards providing cheaper and better telecommunications to all South Africans, but the MTN-Vodacom duopoly seems determined to continue its profiteering at the expense of the public’s right to communicate,” it said in a statement.

The group indicated that the previous glide path had stimulated the industry, with greater competition, lower prices and greater access to telecommunications across South Africa occurring over the past three years.

Cell C would continue to seek ways of lowering the call prices for consumers, Cell C executive head of marketing Doug Mattheus said, citing the operator’s drastic rate cuts before the final MTR cuts from the 2010 glide path were implemented – a move which boosted the group’s subscriber rates.

“We have been a net gainer over the past year … with [Cell C now having about] 14-million [subscribers] on base,” he noted.

Cell C moved to focus on "customer service and experience" after a year of what was termed an "aggressive price war", which saw mobile call price per minute drop to 99c, with per second billing.

“Last year, we positioned [the company] as a price leader, but it is not just about price, retention is important and the company will now [intensify its] focus on network service and experience,” Mattheus added.

‘A NEW ERA DAWNS’
As Cell C migrated and consolidated its operations into one large ‘campus’, the operator planned to officially launch, on March 15, a year-long opening for a new walk-in customer centre – with monthly activities and entertainment planned.

The moving of its operations, which started in November, to a new 46 000 m² head office campus at developer Atterbury’s Waterfall Business Estate, in Woodmead, Johannesburg, was under way and expected to be completed mid-year.

The new campus housed, besides others, the customer walk-in centre, shops, offices, an information technology centre and a 92% automated 12 200 m² warehouse, as well as central and regional operations and a network operations centre.

The walk-in centre, which opened its doors in January as a ‘soft’ launch, catered for, besides others, accounts queries and payments, new and current contract management, technical assistance, 24-hour repairs and the sale of handsets and prepaid packs.

CAMPAIGN
Cell C had also moved to introduce a new multiplatform campaign, starting on Sunday, which mostly leveraged the company’s stance as a “challenger” brand, focusing on the fight to lower the cost of communication, despite opposition, and reinforcing its position as “being on the side of the consumer”.

Mattheus explained that the campaign would incorporate several celebrity ambassadors, including Generations actress Sophie Ndaba, several former Miss South Africa’s and current frontrunners to the 2014 title, for which Cell C was the headline sponsor.

The group, which also sponsored KwaZulu-Natal rugby team the Sharks, planned to launch several new products, including ‘Infinity’ and ‘Hi5’.

Under the new Infinity products, prepaid customers gained access to the new promotional airtime voucher, Infinity Prepaid, which, at R999, enabled infinite calls to any local network at any time of the day, with no opt-in required.

“Over and above the infinite calls, customers will also have 1 000 SMSes and 1 GB of data bundled. The voucher is valid for 30 days from activation,” he noted.

For R1799, postpaid customers will have access to a handset and Cell C’s Infinity Select, which offered unlimited calls to any South African network, anytime, with unlimited SMSes and 3 GB/m of data over 24 months.

What Mattheus believed would set Cell C apart was the offer of  yearly handset upgrades and the replacement, within 24 hours, of damaged handsets.

“Customers that already own a handset and are just looking for the contract benefits will be able to buy Infinity Select as a SIM-only postpaid offer for R999 on a 24-month contract. This offer provides unlimited calls to any local network, unlimited SMSes and 3 GB of data,” he said.

Meanwhile, for R150/m, Hi5 customers obtained 150 'anytime, any network' minutes, 150 SMSes and 150 MB of data, as well as the ability to register five numbers on the Cell C network that will receive a rate – for the life of the contract – of 75c a minute on per second billing – 25% lower than the standard 99c call rate.

The customer would be allowed to change or swap out one registered number a month.

“Hi5 will also be launched with a handset deal, which comes standard with a Samsung Galaxy S3 mini and the inclusive Hi5 monthly benefits at an unbelievable subscription of R199 on a 24-month contract.”

Mattheus stood firm that Cell C would continue to take an “innovative approach” to lowering prices, even while the industry awaited the outcome on termination rate regulations.