Big toll-free number fight in South Africa

MTN recently told MyBroadband it was investigating an incident where a subscriber was billed for making a call to a toll-free number.

MTN said there is no instance where a client should be billed for make a toll-free call.

This is thanks to number plan regulations ICASA published in 2016.

When the regulations were released, it caused a fight amongst telecoms providers, with smaller operators warning that mobile networks were killing the toll-free market.

Switch Telecom told MyBroadband at the time that Cell C, MTN, and Vodacom were dragging their feet on the matter.

For a call to be toll-free, the receiving party pays the originating network for the cost of the call. Switch Telecom said mobile operators were charging high tariffs to reverse-bill toll-free calls, however.

The regulations called for the operators to negotiate origination rates with one another and file interconnect agreements with ICASA, but Switch Telecom said the big players didn’t do that – they just set their price.

Telkom also stopped routing calls from its cellular customers to toll-free numbers operated by other companies.

Switch Telecom lodged a dispute against Cell C, MTN, and Vodacom with ICASA, while Vodacom lodged a dispute against Telkom.

Toll-free fight

Since then, the mobile operators have all zero-rated toll-free numbers and Telkom has started routing calls from its mobile subscribers to all toll-free numbers.

Telkom said it has been doing this for some time, and emphasised that this applies to any toll-free number in the country – but excludes Sharecall number ranges like 0860 and 0861.

While toll-free calls are free on mobile networks, and Telkom is routing all calls, Cell C said there are disputes that were lodged with ICASA regarding toll-free services which have yet to be resolved.

Vodacom said its dispute with Telkom is on its toll-free origination rate of R1.00 (per minute), and that it is awaiting feedback from ICASA on the way forward.

Cell C said it also notified the industry about its reverse-billing rate of R1.32.

Telkom and MTN, on the other hand, said they have negotiated toll-free agreements with operators – which is what Switch Telecom said was required from the regulations.

MTN conceded it has not concluded agreements with all operators, saying that an agreed-upon origination fee has not been finalised.

Regarding its reverse-billing tariff, MTN said its origination fee has not changed since the introduction of toll-free services.

Telkom declined to provide its origination fee.

“This rate is confidential and negotiated individually between each wholesale partner,” said Telkom.

Pricing

A major point of contention is that mobile operators are asking significantly more to connect toll-free calls than they are allowed to charge for normal calls.

ICASA regulates the wholesale termination rate of calls to networks.

Vodacom and MTN are allowed to charge other operators R0.13 for connecting calls to their networks, while Cell C and Telkom may charge R0.19.

However, the mobile networks would argue their toll-free origination fee can’t be compared to a wholesale rate. It must instead be compared to their retail rates.

As they are unable to bill what the customer would have paid to call the toll-free number, they choose an average per-minute calling rate across the various packages they offer and set that as their origination fee.

The table below summarises the origination fees for toll-free calls (excluding VAT), wholesale tariffs (excluding VAT), and the lowest retail ad-hoc call rates the mobile networks offer.

It should be noted that contracts, bundles, and specials can offer lower retail calling prices than those listed below.

Network Toll-free Origination Fee Wholesale Termination Rate Lowest Prepaid Call Rate
Vodacom R1.00 R0.13 R0.79
MTN R1.00 R0.13 R0.99
Cell C R1.32 R0.19 R0.66
Telkom Mobile Confidential R0.19 R0.29

Now read: Vodacom, MTN, and Cell C are killing toll-free numbers in South Africa

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Big toll-free number fight in South Africa