MTN vs Icasa: others comment

MTN filed court papers on 12 February 2014, requesting a review of the Call Termination Regulations 2014. MTN also sought an urgent interdict to suspend the implementation of the regulations.

In response, the Independent Communications Authority of South Africa (Icasa) said on Friday, 14 February 2014, that it has decided to delay its recently announced call termination rate cuts by two months.

It is understood that this delay was necessary to give Icasa more time to prepare for the legal battle against MTN.

Most reports focussed on the battle between MTN and Icasa, but the regulator is merely one of the 31 respondents listed in MTN’s legal papers.

Some of the respondents include large operators, such as Vodacom, Cell C, Telkom, Neotel, and Internet Solutions.

Although most of the respondents were hesitant to comment on the case, some of them shared their views.

Vodacom

Vodacom said that it supports Icasa in the goal of reducing the cost to communicate, adding that they have repeatedly said that they are supportive of lower mobile termination rates.

However, Vodacom is not happy with the process which Icasa followed. “We have concerns about the method used to arrive at the rates published in the Call Termination Regulations, 2014,” said Vodacom.

“It appears that MTN has similar concerns, but we’re obviously not in a position to comment on the merits of their approach.”

Vodacom said that they do not have specific plans regarding MTN’s legal action that they can share at this stage.

MWEB

MWEB ISP CEO Derek Hershaw said that they are not going to oppose MTN’s application.

“I don’t want to make any further comments at this stage because we are involved in the matter,” said Hershaw.

Switch Telecom

Switch Telecom CEO Gregory Massel said that they support the reduction of wholesale call termination rates as this will drive decreases in consumer retail rates.

“We are, however, not convinced that asymmetric termination rates will serve the public interest. This is because at least two European market studies suggest otherwise. Therefore, the EU trend has been to discontinue asymmetry,” said Massel.

“Furthermore, Switch Telecom is concerned that the extreme level of asymmetry which Icasa is trying to enforce is out of line with international precedent. We believe it will inhibit the reduction of consumer tariffs.”

Massel said that there are various other means of promoting competition. This includes fast-tracking the introduction of non-geographic number portability, and regulating national roaming.

“These remedies are much less controversial and more sustainable than the approach Icasa is presently pursuing,” said Massel.

Internet Solutions (Dimension Data)

Internet Solutions (IS) said that it completely supports the Call Termination Regulation 2014.

“We are fully supportive of the rate cuts. The cost to communicate in SA remains prohibitively high and we support the regulator’s intervention but with emphasis that the net needs to be cast wider to not only include voice but data as well,” IS said.

IS said that MTN’s legal action is regrettable as it is their belief that it serves to delay the inevitable.

“There is no doubt that the SA telecoms market requires pro-competitive regulatory intervention from ICASA from voice, data and infrastructure perspectives in order to create effective competition and to level the playing field,” said IS.

“These rate cuts are intended to accelerate that intervention from a voice perspective.”

IS said that at this stage it is looking into the process and reactions from Icasa, and will continue to support actions and regulatory efforts that promote inclusion and a more competitive market which ultimately benefits South African citizens and the country as a whole.

Bitco

Bitco said that it supports Icasa’s call termination regulations. However, they questioned the structure of the new MTRs and the manner in which it has been introduced.

“It appears that not enough consultation and consideration was made as to the full impact on the mobile networks and any indirect effect on consumers,” Bitco said.

Bitco added that MTN are exercising their rights and that they understand that these regulations would have a grossly negative impact on MTN’s turnover.

“I am concerned why it was left to the last minute as this will ultimately effect the consumer and the cost to communicate in South Africa,” said Garth van Sittert, Bitco managing director.

“We expect that lower MTRs will be implemented, possibly, under a new, less aggressive structure at a later date. As soon as the MTRs are reduced we will reduce the call charges to all our customers,” said Sittert.

Cell C

Cell C acting CEO Jose Dos Santos said that they definitely support Icasa’s call termination regulations.

“This regulation is in the interest of the consumer, the telecommunications industry and the broader South African economy,” said Dos Santos.

“Icasa promulgated the regulation after taking into account the submissions of all interested parties and having weighed up the impact of the regulations on the operators, telecommunications industry and society at large, with the objective of reducing the cost to communicate, and this is in line with government policy.”

He said that MTN’s application to set aside the regulation is nothing more than an attempt to stifle competition in the industry and entrench the existing duopoly, on the basis that they are just being supportive of “due process”.

Dos Santos said that Cell C is consulting its legal team and will oppose MTN’s application in the strongest terms.

More on Icasa’s termination rates 2014

Did Icasa roll over?

Telkom’s big score

MTN’s R286 million gift from Icasa

Termination rate cuts postponed

Did Icasa mess up?

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