Telkom has responded to the publication of the Competition Commission’s final report on its Data Service Market Inquiry, stating that it agrees with the statement that MTN and Vodacom dominate the South African market.
The company described South Africa’s cellular market as a “duopoly” – referring to the large market shares of Vodacom and MTN – where there was no effective competition.
“Telkom is pleased that the data market enquiry has affirmed the view that the South African market is a duopoly with no effective competition,” Telkom told MyBroadband.
The Competition Commission said that MTN and Vodacom must drop their prices, noting that “there is scope for price reductions in the region of 30% to 50%”.
“Price is the effect of a market structure,” Telkom said.
“The Competition Commission must interrogate the structure of the market and review all the components that give effect to current data prices,” the company added.
Telkom also said it was pleased to see that the Competition Commission has committed to giving attention to the process of licensing spectrum.
“We have seen the consolidation of spectrum recently. This influences market structure,” Telkom said.
“Spectrum sharing agreements need to be reviewed to ensure they support market competition.”
In addition to the points mentioned above, the Commission also argued that mobile operators should provide all prepaid users with “a lifeline package of daily free data”.
This is to “ensure all citizens have data access on a continual basis, regardless of income levels”.
MyBroadband also asked Cell C for its feedback on the Competition Commission’s report.
The network said it was still reviewing the findings of the Commission and would provide detailed feedback once it had completed its review.
“An industry that promotes sustainable investment, effective competition and affordable services to consumers is a win for all,” Cell C said.
“Cell C recognises that lower data costs are a catalyst for economic growth and therefore welcome steps taken to bring down the cost of data.”
“Against this background, we are reviewing the findings of the Competition Commission in the Data Market Inquiry and will provide more detailed comment once we have completed our review,” the company said.