Telkom vs Neotel vs ICASA: 2012 termination rates

While the cost of terminating calls on mobile networks was reduced in March, price cuts from Telkom and Neotel don’t appear to have kept pace.

South Africa’s regulator, the Independent Communications Authority of South Africa (ICASA), has instituted a 3-year “glide path” for voice interconnect rate reductions which comes into effect on 1 March every year until 2013.

This year’s price cuts saw the peak regulated rate decrease from 73c to 56c, while the off-peak rate went from 65c to 52c. Next year the process comes to an end when the peak and off-peak regulated rates both become 40c.

ICASA’s regulations also make provision for a so-called “asymmetric allowance” which lets smaller players such as Cell C and 8ta charge other operators more for terminating calls on their networks. This year that allowance was lowered from 20% to 15%, and will decrease to 10% next year.

When this year’s new termination rates came into effect Neotel was first to respond with price cuts, announcing its new rates on 1 March 2012. Reductions ranged from 4% to 23%.

Telkom’s new rates were recently announced and will apply from 1 August 2012.

The table below compares the reductions offered by both Neotel and Telkom against the reduction in termination rates mandated by ICASA.

Telkom and Neotel to mobile per-minute pricing compared
Operator and destination Old New Adjustment
Mobile termination rate R0.73 R0.56 -23%
Neotel to Cell C/8ta/Virgin R1.368 R1.05 -23%
Neotel to Vodacom/MTN R1.083 R1.05 -3%
Telkom to mobile R1.40 R1.35 -3.6%
Mobile termination rate R0.65 R0.52 -20%
Neotel to Cell C/8ta/Virgin R1.0944 R0.93 -15%
Neotel to Vodacom/MTN R0.969 R0.93 -4%
Telkom to mobile R1.122 R1.08 -3.7%

Telkom’s new prices (2012): full details

You may pay more with lower interconnect rates

Mobile termination rates: How does SA compare?

Voice rates: who cut prices and who didn’t?

Neotel versus Telkom (2011)

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Telkom vs Neotel vs ICASA: 2012 termination rates