Cell C proposes 75c and 65c interconnect rates

[Creag]

MTR cuts:

In favour - CellC, Telkom, Neotel, everyone else

Against - Vodacom, MTN. no-one else!!

I see a trend developing here ...

 

[redheadfan]

Well the instruction from the Communications minister is to move to a cost based Interconnect. On a cost based approach the smaller operators will justifiably have a higher cost per call. The bigger players benefit from scale of economy which means that it costs them less per call.

At the end of the day the Interconnect in and out from should be nearly balanced:
Small operator makes 500 calls to bigger operator at 20c per call = R100
Small operator receives 200 calls at 50c per call = R100

So there is potentially room for an even bigger split in the cost based approach in favour of new entrants.

Of course since Cell C doesn't have their own towers/Network the cost difference will be a lot smaller in their case.