cellphone face-off

CONCERNED: Icasa chairperson Paris Mashile. Pic. Trevor Samson. 16/02/2010. © Sunday Times.
CONCERNED: Icasa chairperson Paris Mashile. Pic. Trevor Samson. 16/02/2010. © Sunday Times.

THE Independent Communications Authority of SA hinted yesterday that it could take on cellphone operators on "astronomical" pay-as-your-go rates.

THE Independent Communications Authority of SA hinted yesterday that it could take on cellphone operators on "astronomical" pay-as-your-go rates.

The regulator's chairperson, Paris Mashile, told Parliament's portfolio committee on communications that there was an urgent need for competition in the pay-as-you-go market, which was used mainly by the poor.

The prices paid by the poorest of the poor were astronomical, he said.

Mashile was briefing the committee after Icasa's approval of a cut in the rate charged by the three main cellphone operators to connect calls between networks.

Vodacom, MTN and Cell C last month filed an agreement with Icasa proposing a cut in the peak interconnection rate from R1,25 to 89c on March 1.

Icasa rejected the plan because it would have forced it to agree to a fixed gradual reduction over three years.

The operators later submitted revised agree-ments without the "glide path".

With the approval of those proposals, the peak rate will fall on March 1, as initially planned.

Cellphone operators have complained that the rate cuts might lead to job cuts. Mashile said if the cell companies operated efficiently there would be no need "to cry foul that Icasa is responsible for the destruction of jobs".

"Jobs must be sustained but not at the expense of poor consumers."

But MPs said the rate cuts were only benefitting the rich.

"Those who are running business out of cellphones are going to pocket more," ANC MP Eric Kholwane said.

"The cost of communication to the poor remains the same. There is no reduction."

Mashile thanked Communications Minister Siphiwe Nyanda for "having led the horse to the water, and we forced it to drink".

A letter from Andrew Barendse, group executive of Telkom, to the committee chairperson Ismail Vadi said the company would give a 100percent pass through of the reduction in mobile termination rates to its retail customers, "although not legally obliged".

Icasa is due to release draft regulations on wholesale call terminations next month. It will hold public hearings in May and publish final regulations by June. - Sapa and I-Net Bridge

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