Political push for lower mobile termination rates likely
As the third and final drop in the mobile termination rate (MTR) neared, the Internet Service Providers Association (Ispa) said it believed that there would be a political push for further price reductions.
The current MTR – stipulated by the Independent Communi-cations Authority of South Africa (Icasa) – was expected to be reduced to 40c a minute on March 1.
MTRs are the fees mobile phone companies charge other carriers to terminate calls on their networks.
Initially R1.25 a minute in 2009/10, the rates fell to 56c last year, from 73c and 89c in 2011 and 2010 respectively, after Icasa published the three-year guideline in October 2010.
off-peak MTR was currently 52c a minute.
Icasa sought to balance the need to ensure fair consumer prices, promote competition and ensure a favourable investment environ- ment.
As the benefits of the lower MTRs reached the consumer, it was likely that there could be a call for further reductions, Ispa regulatory adviser Dominic Cull said, recalling a recent Parliament- ary Committee meeting response to a November cost-to-communicate report.
Politicians were fully aware of what the implications of lower rates were for the end-user and were likely to promote further cuts.
However, Cull commented that Cell C was calling for a review of interconnection agreements, which could only be undertaken by Icasa, to ensure fairness, as it fought to hold the current asymmetry allocation.
Asymmetry was going to be the “headline battle” of the year, as Vodacom and MTN fought against Cell C’s push for smaller operators to retain the 15% asymmetry rates.
Asymmetry allocations allowed smaller operators with less than 25% market share, such as Cell C and 8ta, to charge a maximum MTR of 10% above the set rate from March 1.
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