Neotel versus Telkom

Fixed and mobile termination rates were reduced on 1 March 2011, in line with the Independent Communications Authority of South Africa (ICASA) glide path announced last year.

Vodacom and MTN’s peak mobile termination rates were reduced from 89c per minute to 73c per minute, while off-peak mobile termination rates were also reduced, from the previous 77c per minute to 65c per minute.

Fixed line termination rates were also reduced on 1 March, with the new peak and off peak rates dependant on whether or not the calls terminate within the caller’s area code.

Neotel were quick to pass on these savings to their subscribers, and said in a press statement that it has “kept its promise, and has passed on cost savings to its customers, by reducing the price of calls to most mobile phones.”

Neotel calls to MTN and Vodacom phones will now cost 95c (plus VAT) during peak hours, and 85c (plus VAT) during off-peak hours. Calls to Cell C and 8ta cost R1.20 (plus VAT) during peak hours, and 96c (plus VAT) during off-peak hours.

Telkom was also expected to cut their retail prices after the lower mobile termination rates, but to date the company has been mum on the issue and has kept its prices unchanged.

Pricing Comparison

The following table provides an overview of how Telkom and Neotel stack up when it comes to call rates.

Neotel versus Telkom << Comments and views