Cellular27.02.2013

Mobile termination rates should be 15c to 25c: ICASA

By Staff Writer

The Independent Communications Authority of South Africa (ICASA) said that the glide path for termination rates will continue as provided for in the Call Termination Regulations; and that the mobile termination rate will drop to R0.40 on 01 March 2013 as planned.

When publishing the Wholesale Voice Call Termination Regulations in 2010, the regulator set out the three-year glide path.

“Since the introduction of the three-year glide path is contained in the regulations, any changes to such a regulatory matter would require a public process that will afford all relevant stakeholders an opportunity to make their comments,” ICASA said in a press statement.

“Further, any changes would need to be informed by a comprehensive study or market review.”

“We have noted the concerns raised by various parties and will be initiating a review of the call termination market and look into the matter of price transparency on an urgent basis,” the regulator added.

Glide path for termination to a mobile location
Date	Peak	Off-peak
01 March 2011	R0.73	R0.65
01 March 2012	R0.56	R0.52
01 March 2013	R0.40	R0.40

ICASA said that it acknowledges that some reductions in the retail price have taken place, however it is concerned that there has been an insufficient increase in competition over the past few years.

“Our goal is to promote effective competition and are of the view that the cause or barrier to a lack of effective competition is the high termination rate. High termination rates are a barrier to reduced off-net call prices and therefore prevent effective retail price competition,” said ICASA.

ICASA said it sees no reason why mobile termination rates should not be in the region of R0.15 to R0.25, based on benchmarks set by South Africa’s peers in Africa and the rest of the world.

“It is also conceivable that termination rates should tend towards zero over time. The upcoming market review will address the above issues.”