Will connection fee regulation lower prices?

A reduction in wholesale fees would not cause an equal reduction in retail fees, warns Graham de Vries, MTN?s GM for legal and regulatory affairs. The prepaid cellphone business is reliant on incoming calls, and if operators make less on connection fees, they may raise pre-paid tariffs.
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It's called: sustaining profits at all costs! :mad:
 
Telkom regulatory affairs executive Gabriele Celli says forcing an operator to merely cover the cost of interconnection will not let it recoup the billions of rands invested in building its network.
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Along the same lines as you are 'recouping' the cost of the SAT-3 cable, rofl.
 
Recouping Costs

As I see this, the 'dominant' operators are complaining they won't be able to recover the costs of their network infrastructure. How on earth did they plan to continue 'recovering' costs indefinitely for infrastructure that is already in place and supposedly operational? Perhaps their plan is to recover as much as possible and to use the profits to expand their existing infrasture (from both own and other operator's customers)?

How many times should existing cables that have already been paid for be expected to 'recover' costs? Or is the pricing model based upon a scale including a percentage of new users contributing to the 'recovery'??

Maybe I can use a similar model - I'll buy myself a new car and start a car pool to work. In order to 'recover' my costs, I'll charge a higher fee (fuel + wear and tear + car repayment) and run this same fee (plus increases due to inflation) for an extra couple of years after the actual car is fully paid for so that I can add extras like a new radio and speaker system, new mag wheels etc.) so that in the end, it doesn't cost me anything :p

That's my laymen's view of what's going on. Perhaps someone could clarify any misconceptions?
 
Recouping costs is an excuse... I know that a vodacom tower installation and quipment is completely paid for after the first month of use. 30days for a return on investment! thats a no-brainer.
 
LifelongGamer said:
Maybe I can use a similar model - I'll buy myself a new car and start a car pool to work. In order to 'recover' my costs, I'll charge a higher fee (fuel + wear and tear + car repayment) and run this same fee (plus increases due to inflation) for an extra couple of years after the actual car is fully paid for so that I can add extras like a new radio and speaker system, new mag wheels etc.) so that in the end, it doesn't cost me anything :p
You left out the bit where you buy 2 new cars and then proceed to 'recover costs' for them, where you buy 2 new cars and then proceed to 'recover costs' for them, where you buy 2 new cars and then proceed to 'recover costs' for them, .... :D
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Inter-connection fee must be reduced and regulated, There is no doubt reduction of inter-connection fee will bring competition to the market and lower price to consumer .

People casting doubt about this , have ulterior motives..

ICASA need our support on this one .
 
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What has prompted the proposal is a 635% spiralling of these fees over a decade. The operators are probably recovering more than they should be, says Icasa councillor Tracy Cohen.
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How does a few towers and switches equal a network? Let's get another cell operator - even more interconnection fees - no wonder "competition" is no competition at all.
 
ICASA is not going to be able to please everyone - it's main target should be the consumers though - the whole reason for the organization's existence.
Just implement the changes - the moaning from operators is to be expected. Deal with that later.

Regulating the interconnection fees (like other forumites are saying) will allow for a competitive environment!
 
Any new developement on the inter-connection fee battle ?

This is the single most important step to combat excessive voice tariffs.

Telkom over-pays Inter-connection fee therefor has to over-charge consumer to recover their costs.



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gooku said:
Telkom over-pays Inter-connection fee therefor has to over-charge consumer to recover their costs.
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Just a pity they add a BIG markup to this as well... must be, otherwise their profits wouldn't be so extremely high! :(
 
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