Parliament Committee Calls For A Drop In Interconnection Rates By Telecom Operators

South Africans will soon know if they will be charged an interconnection fee when making a call from one network to another. According to media reports, The Portfolio Committee on Communications is to hold public hearings in October 2009 to have mobile operators bring down their “excessive and exorbitant” interconnection rates.

South Africans are currently paying R1.25 per minute during peak times for their interconnection fee, a charge to enable calls to be transmitted from one network to the other. The committee met with the Independent Communications Authority of South Africa (ICASA), the Competition Commission and the Department of Communications on 15 September 2009 to discuss the interconnection rates.

During the meeting the committee agreed that it was necessary to call for public submissions on 13 and 14 October 2009. It will propose that mobile and telecom operators drop the interconnection rates with effect from 1 November 2009 to 60 cents per minute during peak times. It further wants interconnection rates to be reduced by 15 cents annually on 1 November for each successive year until 2012 and that this should results in reductions in the actual retail prices of telecommunications.

In a statement, the committee said it based its proposals on the belief that interconnection rates in South Africa were exorbitant and excessive, resulting in extremely high telecommunication prices. It also believed that this was the consequence of apparent historical collusion between dominant mobile operators in the country. This, it said had “placed profits and greed above people”. Further to this, the committee felt that ICASA was not effectively regulating the situation and called on the Minister of Communications, Siphiwe Nyanda, to finalize the performance management system of ICASA Councilors as embodied in the ICASA Act.

“The high costs of mobile and fixed line telecommunications have impacted adversely on the South African economy and negatively on citizens, particularly the poor and marginalized. There is unanimity in the industry, government, other relevant stakeholders and the regulatory authority that the present situation is socially indefensible and economically unjustifiable,” said the committee.

It requested the department to report back to the committee on the matter by the 30th  November 2009, and for ICASA to act professionally, effectively and boldly to regulate interconnection rates in South Africa as a matter of urgency. The committee said it was willing to introduce a Committee Bill to amend the Electronic Communications Act (No 36 of 2005) in the next session of Parliament to enable ICASA to act swiftly in the matter.

Vodacom confirmed on 16 September 2009 it was “ready to reduce the mobile termination rates as long as the cost of terminating another party's call plus a fair profit is demonstrated”.

Reagan Malumo
Programme Officer: Media Freedom Monitoring and Research
Media Institute of Southern Africa (MISA) Regional Secretariat
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Private Bag 13386
Windhoek
Namibia
Phone: +264 61 232 975
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E mail: reagan@misa.org

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