Cell costs up amid Icasa probeJul 22 2005 02:56:41:240PMPrint story onEmail Story

Cell costs up amid Icasa probe

Cell costs up amid Icasa probe
Jul 22 2005 02:56:41:240PM


Johannesburg - While the statutory Independent Communications Authority of South Africa (Icasa) is poised to introduce a framework that would yield lower mobile tariffs, Cell C this month hiked tariffs, with MTN and Vodacom likely to follow suit on August 1, it emerged this week.

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Cell costs up amid Icasa probe

Cell costs up amid Icasa probe

Jul 22 2005 02:56:41:240PM

Johannesburg - While the statutory Independent Communications Authority of South Africa (Icasa) is poised to introduce a framework that would yield lower mobile tariffs, Cell C this month hiked tariffs, with MTN and Vodacom likely to follow suit on August 1, it emerged this week..............

Cell C spokesperson Jonathan Newman said the Saudi Arabia-held firm hiked charges for its high-spending contract users - estimated at 500 000 or 20% of Cell C's total subscriber base.

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Is this a move to try and mask the difference between prepaid and contract users, or is this the competition that is required, rather than regulation, as was mentioned by Maanda Manyatshe, the head of MTN's core South African business in this other article

"The moment the government and regulators start setting prices this country is in trouble," Maanda Manyatshe, the head of MTN's core South African business, said this week.

If the government wanted to force down prices it should issue a fourth licence to operate a cellular network, Manyatshe said at the launch of MTN's first service centre in Soweto. "I believe in cutting prices through competition, not regulation."

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http://www.busrep.co.za/index.php?fArticleId=2633228&fSectionId=552&fSetId=304

If thats competition Maanda, I will take regulation any day of the week.
Idiots, your time will come.

If these sudden contract price hikes don't show ICASA that these operators are full of mischief, nothing else will.

Just as ICASA is about to evaluate the difference between contracts and prepaid, these operators NOW try and adjust the price differences in an attempt to fool us!!! Why didn't they decrease the prepaid rates instead, resulting in a closer match between contract and prepaid rates???!!! I hope ICASA doesn't fall for these underhand tricks!!!

kaspaas, perhaps this is a move by the cell operators to pre-empt Icasa'a upcoming attack on their prices?

Increase prices in August, then when Icasa says decrease prices by X%, we will decrease prices and be left with similar tariffs as we had before August ...

Just a thought.

I'm gonna be sending in a public submission, and will be looking for people to attach their name to my submission (more people = more weight). Watch out on MyAdsl if you may be interested in giving the cell operators a hard time about their tariffs.

What would be the benefits of a contract if pre-paid rates costs the same as contracts? (Im on prepaid but in business point of view)

Please can a mod merge this thread with the one in the Consumerism and Deregulation section? Same article has been posted twice. Thanks

Hello Debbie2.

We will do so.
I just don’t have privileges in that topic, Consumerism and Deregulation.
Best in future just to click, "report bad post". As unless a Mod actually reads your post, the thread may never be merged or moved and the correct mod will be notified immediately by email.
You can appreciate that we cannot read every thread on MyADSL. Although we do try. Hehe. (...BTTB rubbing eyes at 3am in morning).

As things stand at the moment, the contract rates cost less. Which means that although you pay a fixed monthly charge for being on contract, making calls is actually much cheaper than being on prepaid. That's one of the drawcards that these operators use to lure people into being on contract.

The problem with this, if I'm correct, is that contract users normally also get "free" cellphones in these contracts. In addition, they get such things as "free minutes" and several other benefits that prepaid users don't get. These benefits that contract users have at the moment far outstrip (according to recent complaints) the benefits that prepaid users have (It would seem the monthly contract charges can't possibly cover all these extra benefits). This excludes their cheaper call rates. The questions is then: why is there such a huge difference between contract and prepaid rates??? Aren't contract users already getting enough benefits??? How sure are we that MTN, Vodacom and Cell-c are not charging these high prepaid rates in order to subsidise these contract users? Which would then mean poorer people are actually paying higher rates in order to subsidise people who can afford to be on contract.

I don't think ICASA will want to force these operators to make these rates equal. HOWEVER, the difference between the two shouldn't be SO vast that it starts to seem as if prepaid users are getting the short end of the stick.

If BOTH prepaid and contract users received EXCATLY the same benefits and contract rates were moderately cheaper than prepaid (because of the fixed monthly contract charges), I don't think there would be such an outcry about the difference between the two rates. The only thing that would bother people in this scenario would be the high cellphone rates these operators charge, whether you're on prepaid or contract. But that's another battle.

My view on this matter might be flawed and my above text might seem a bit confusing (I need more work on my essay skills I guess!!!) but that's how the current prepaid/contract saga seems to me. Correct me if I'm wrong!!!

I'm quite happy receiving a "free" cell phone on contract and I don't have a problem with the cell networks offering preferential rates to those people who will be "loyal" to the network for 2 years, this is just business. You don't see ICASA slamming Telkom for offering a free ADSL router to people who sign up for 2 years.

As for poor people, well the pressure should first be on Telkom to provide them with the lines that were promised instead of disconnecting them! While a cell phone may be viewed as a necessity to most of us it is still a luxury item in most countries and I don't believe the cell networks should be slammed for not picking up Telkom's slack.

Having said this I do believe that ALL cell providers need to engage in real competition and bring their prices down for both contract and prepaid users. All providers (including Telkom) need to lower their interconnection rates.

Perdition said:

I'm quite happy receiving a "free" cell phone on contract and I don't have a problem with the cell networks offering preferential rates to those people who will be "loyal" to the network for 2 years, this is just business. You don't see ICASA slamming Telkom for offering a free ADSL router to people who sign up for 2 years.

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I agree that contract users are getting better rates and a "free" cellphone because of their "loyalty", I don't have a problem with that. After all, that is indeed what differentiates prepaid from contract users. I guess what worries me is the extent to which contract users "benefit" from the fixed monthly charge they pay, when compared to prepaid users. Sure, contract users should have more benefits. However, I think ICASA is trying to see if the prepaid rates (when compared with those of contracts) are justifiable in light of ALL the above factors.

We can actually view this whole debate from another angle...
You might find that ICASA believes that the contract rates in this country are, more or less, the rates that ALL cellphone users should AT MOST pay. Meaning, if you're on prepaid, you should actually be paying the rates that contract users are paying NOW.
In response to that, the cellphone operators may then feel free to offer even lower rates to contract users. As long as that doesn't in any way mean that prepaid rates should be increased in order to subsidise these "loyal" users.

Fair points, I'm all for the lowering of rates even if only the prepaid users benefit. I just don't want ICASA taking it so far that I lose the benefits of having a contract i.e. cell providers stop offering "free" phones.

There's no such thing as a free phone. Trust me, you're paying for it. Wouldn't it be better to see exactly who is paying for what where, rather than having everything deliberately muddled behind a complexity of cross-subsidisations? Many people really are tricked into believing they are getting free phones.

That's why I said "free" phone. I know fully well I'm paying for it over 24 months but all things considered I'm paying less over 24 months than what I would if I bought it separately and then had to pay for airtime on top of that.

Well, let's hope ICASA will find a solution that will result in both contract and prepaid users being satisfied. After all, there's no point in ICASA now focussing too much only on the prepaid users, leaving a lot of unsatisfied contract users behind.

Sneeky said:

Is this a move to try and mask the difference between prepaid and contract users, or is this the competition that is required, rather than regulation, as was mentioned by Maanda Manyatshe, the head of MTN's core South African business in this other article

http://www.busrep.co.za/index.php?fArticleId=2633228&fSectionId=552&fSetId=304

If thats competition Maanda, I will take regulation any day of the week.
Idiots, your time will come.

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Already posted this article in this thread
http://mybroadband.co.za/vb/showthread.php?t=23983

Sneeky - thanks for bumping the issue up again

merged...