MTN owes Cell C R 200-million
According to Hedberg the dispute over interconnect rates, which has been dragging on for around 3 years, is associated with the location of Cell C’s Community Service Telephone (CST).
MTN claims that Cell C has not restricted the roll out of CSTs to poor and rural areas but Cell C maintain that ICASA approved of their plans.
Hedberg said that he suspects that MTN’s unhappiness with the current arrangement stems from the fact that they did not fully capitalize on the opportunities which the CSTs brought. Both Cell C and Vodacom aggressively rolled out CSTs and it has proven to be a profitable investment.
While ICASA has approved Cell C’s rollout plans, the regulator conceded in court that it had not ‘applied its mind’ when approving these plans. This admission in the High Court lead to a ruling that Cell C’s CST roll out is in question but no judgment was made about the third mobile operator.
The result is that MTN are now refusing to pay any interconnect fees to Cell C until the dispute is resolved. This includes the areas in question and those which are not in question as well as all commercial interconnect fees that are not part of the dispute.
When Cell C realized that MTN was not paying their bills they followed suit and halted their interconnect payments.
Hedberg said that Cell C has approached the Competition Commission to declare that MTN is abusing its Significant Market Power, and pointed out that there was no attempt from ICASA to assist in resolving the dispute.
MTN said earlier this year that it is still in talks with Cell C, but that it is looking at taking legal action in this dispute to reclaim ‘millions in unpaid interconnection fees’.
According to iWeek, MTN's head of regulatory affairs, Nkateko Nyoka, says as a result of Cell C’s Community Service Telephone rollout in areas other than ‘rural and poor’ MTN was forced to subsidise Cell C's commercial operations.
“Cell C charged CST rates to its customers in areas where it should be charging commercial rates, short-changing MTN on the interconnect rates,” Nyoka was quoted as saying.
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