Mobile operators to cut MTRs to 10c
South Africa's mobile operators are expected to cut their mobile termination rates (MTRs) even further as the Independent Communications Authority of South Africa (Icasa) prepares to implement a new glide path.
Speaking at a last-minute media briefing to discuss the latest rates, in Sandton, on Friday, the regulator said it planned to cut MTRs to 10c by March 2016.
The draft Call Termination Regulations, which were developed after the conclusion of Icasa’s previous three-year MTR glide path and a review of that glide path's outcomes, outlined the revised termination rates, as well as potential levels of asymmetry being made available to smaller players.
The three-year plan would see mobile operators with market shares in excess of 20%, such as MTN and Vodacom, dropping their termination rates, currently at 40c, to 20c by March 2014 and to 15c by March 2015, culminating in an MTR of 10c by March 2016.
Operators with less than 20% market share. such as Cell C and Telkom's mobile arm, 8ta, would be able to charge dominant players an asymmetric rate of 44c until March 2014, when they would be required to reduce their fees to 39c.
The five-year asymmetric glide path stipulates further decreases to 33c in March 2015, 26c in March 2016, 20c in March 2017 and 14c in March 2018, before aligning to the final MTR of 10c.
This comes after an assessment revealed that the previous MTR cuts had not produced the intended increase in competition. Icasa's review earlier this year had found that the market remained ineffective with "extremely high levels of concentration".
The regulator's 2010 Wholesale Voice Call Termination Regulations had systemically shrunk over the years, decreasing 68% to the current 40c a minute, from an initial termination rate of R1.25 a minute in 2009.
Icasa expected to gazette the draft regulations shortly, after which mobile operators would have 14 days to comment.
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