Low Vodacom effective call rates questioned

Effective pricing is nothing more than lipstick on a pig + it's so easy to manipulate.

Stop this crap ICASA it's time to level the playing field -- take away the stranglehold.
 
chopsky said:
Screw you Icasa. THERE IS NO SUCH THING AS PREDATORY PRICING.
We ALL benefit from lower prices. The company is taking a risk by offering prices below cost!

ECONOMICS 101. Fools.
Click to expand...

No, it's not like that... It's quite obvious Vodacom makes giant profits off their calls, but they keep squealing that they will lose money on lower interconnects, yet offers pricing that proves it won't. This is ICASA calling Vodacom's bluff on their BS. They say as much here:

It can further indicate, the regulator said, that the real cost of termination is far lower than the current termination rates.
Click to expand...

I think this is just ICASA firing a salvo in their dispute about lowering interconnects, get your popcorn and let them fight it out.
 
elvis_presley said:
No, it's not like that... It's quite obvious Vodacom makes giant profits off their calls, but they keep squealing that they will lose money on lower interconnects, yet offers pricing that proves it won't. This is ICASA calling Vodacom's bluff on their BS. They say as much here:



I think this is just ICASA firing a salvo in their dispute about lowering interconnects, get your popcorn and let them fight it out.
Click to expand...

i fully agree this shows ICASA has point on lowering the MTR.
 
I never thought I'd see someone ask if Vodacom's prices were too low.
 
Clearly there is misunderstanding here on the subject.

Let me clear this up for everyones benefit.

VodaCom having the largest customer base are able to offer on net calls for as little as 6c per minute.
However the same customer who makes an off net call will be paying about R1-50 per minute.
This prevents customers leaving them for (TM) 75c per minute or (CC) 99c per minute to any network.
This is predatory pricing because customers then force their friends and family to be on Vodacom because of the Promotion benefit. This is a major problem because Vodacom is effectively saying to their customers DONOT make cross network calls.
If they do then VodaCom will punish them with high call rates.

ICASA is on the right track guys. Rather than pull them down unnecessarily suggest how things can be done better to regulate MTN & VodaCom.
 
Bull****, when I was with Vodacom they charged me R1.50+ just for having the pleasure of my calling cutting out after a few seconds.
 
DXL said:
Clearly there is misunderstanding here on the subject.

Let me clear this up for everyones benefit.

VodaCom having the largest customer base are able to offer on net calls for as little as 6c per minute.
However the same customer who makes an off net call will be paying about R1-50 per minute.
This prevents customers leaving them for (TM) 75c per minute or (CC) 99c per minute to any network.
This is predatory pricing because customers then force their friends and family to be on Vodacom because of the Promotion benefit. This is a major problem because Vodacom is effectively saying to their customers DONOT make cross network calls.
If they do then VodaCom will punish them with high call rates.

ICASA is on the right track guys. Rather than pull them down unnecessarily suggest how things can be done better to regulate MTN & VodaCom.
Click to expand...
Most of us get this, but however thanks for the clarity.

The large variation between on / off net calls (incl. effective pricing) is alone proof enough that ICASA needs to speed this through to its ultimate conclusion i.e.legal determination of the crap surrounding the duopoly.

Nothing is gained by principally playing this through the media; clearly VC & MTN are unfazed by all of this -- ICASA: time to stop barking and develop a bite!
 
Last edited:
Nobody in the country fell for the "effective" rates, except for ICASA!!
 
chopsky said:
Screw you Icasa. THERE IS NO SUCH THING AS PREDATORY PRICING.
We ALL benefit from lower prices. The company is taking a risk by offering prices below cost!

ECONOMICS 101. Fools.
Click to expand...

I think you need to read the article again. ;)
 
ICASA: regulating the price of bits for your benefit

If Vodacom is pricing too close to the interconnect rate and that bothers so much, then drop the interconnect rate. Make the interconnect rate a function of their pricing, rather than supposing that you will control pricing by controlling the interconnect rate. Why is the interconnect rate high? Because of regulation. Reduce the rate and leave everything else to the competition board.

Interconnect: this reminds me - does Telkom still not peer at jinx? If interconnect is such a big deal, why have ISP's been forced to pay for Telkom lines to Telkom IP networks?
 
Last edited:
Yeah power hour R5 for 60 min is the big cuprit here too. I also seen some vodacom customers allowed to buy the R2.99 for 60min vc to vc calls and that makes this situation even worse. Cheap on net calls but expensive off net calls.

If vodacom drop the anytime per second tarrif to R1 per minute from R1.20 then vodacom will get new customers. They have the best on net callrates and promotions of all the networks except Telkom Mobile sim sonke. They have a nice on net promotion for calls but no subscribers to use it on.
 
The goal, Icasa said, is that consumers will know what the cost of a call will be before they make it, helping them to make informed choices.
Click to expand...

I would love to see Icasa push this. I have no idea what rate I'm paying or what promotions I qualify for when I make a call.
 
'Effective' rates are calculated by taking the total voice revenue / total number of minutes and is thus a true reflection of the real average price per minute.

More interesting (and what most missed above) is the concept of 'predatory pricing'.

If an operator with a smaller network sells below cost or have a substantially different on-net than off-net tariffs, this is deemed to be competitive and is applauded. (The very same network claiming this should not be done is actively doing both itself, BTW.)

But if a major market share holder does the same, it is illegal and is called 'predatory pricing'.
 
@jannievanzyl, give it up already re "effective rates". The facf is that today nobody has a clear idea of what cost they will be charge for a call at any point in time; I certainly find no value in being confused about cost.

The current approach only benefits the networks, as it serves as an effective way to lock in your confused customers, for example: who should a customer trust when reviewing costs?

With such a complex cost model, customers tend to be confused to the point of avoidance; they skip a natural periodic reevaluation re its far too complex / confusing; throw on top of this the mixed marketing messages (like effective rates) and you as a network provider have successfully stifled customer choice and ensured lock-in.
 
Last edited:
chopsky said:
Screw you Icasa. THERE IS NO SUCH THING AS PREDATORY PRICING.
We ALL benefit from lower prices. The company is taking a risk by offering prices below cost!

ECONOMICS 101. Fools.
Click to expand...

Looks like you haven't your class.

Companies use predatory pricing to push out smaller competitors, then raise prices later.
 
Chevron said:
Looks like you haven't your class.

Companies use predatory pricing to push out smaller competitors, then raise prices later.
Click to expand...

Exactly what the duopoly did with MTRs when CellC's entrance was announced. With all this clarity around collusion, predatory pricing, ... it's difficult to understand why the duopoly hasn't felt the wrath of either the competition commission and/or ICASA.

This crap simply has to stop, but please ICASA not before enforcing huge financial penalties against the duopoly for past and current transgressions.
 
Last edited:
You must log in or register to reply here.
Back
Top
Sign up to the MyBroadband newsletter
X