Vodacom and MTN play interconnect trump card
Cell C has shot itself in the foot by not agreeing to Friday's proposal
Cell C has shot itself in the foot by not agreeing to Friday's proposal
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With respect to Hilton I do not see how the drop in MTR between VC and MTN will provide any scope for them to reduce retail rates. He is however silent on the impact expected with regards VC & Telkom and MTN & Telkom re MTR as these agreements would in theory also have to be renegotiated.You can bet that MTN and Vodacom will announce decreases in their retail tariffs before the end of the year, because thanks to a 19% reduction in interconnect charges, they have scope to do so.
It's clear why Cell C wants this system, and an immediate implementation. It is a net payer as Cell C subscribers make more calls to other networks, than the amount of calls made to Cell C from Vodacom and MTN users. Right now, as the smallest operator in the market, it would benefit most from asymmetric interconnect because it will make it possible for it to cut call charges more than the other operators are able to. http://mybroadband.co.za/news/Business/10193.html
and if i told you that cell c is a net receiver of interconnect fees ...
Based on some of Hilton's other incorrect perceptions I tend to place more value on dominic's comment. It is of course possible that both are correct if one assumes dominic's comment to be due to the Telkom asymmetrical effect and Hilton to be ignoring the Telkom effect. However I suspect in any event that the net cashflows are negligible in relation to the total turnover of the operators.
The problem now for Cell C is that, by not agreeing to the proposals from the two companies that account for the majority of the market, it is even more disadvantaged than before.
You can bet that MTN and Vodacom will announce decreases in their retail tariffs before the end of the year, because thanks to a 19% reduction in interconnect charges, they have scope to do so.
Consumers shouldn't expect a 20% reduction in call prices, but even a 10% drop in certain tariffs will deflect a lot of political pressure and will help government accept the plan from the two dominant operators.
The current blended rate is around 96c per minute. MTN and Vodacom say there will be an immediate 19% reduction in that number, with further reductions year-on-year for the following three years.
Cell C won't be able to offer consumers those reductions in tariffs, as they'll be stuck paying the current interconnect rate which was agreed on a bilateral basis with both Vodacom and MTN when it entered the market.
In this high stakes poker game, Cell C realistically has no other option but to fold and accept the new rules.
(and yet another interconnect fee article...)
the more aware people become of how MTN and Vodacom have been screwing the public, the better, or would you not agree?
(and yet another interconnect fee article...)
so MTN and VODA are acctually in charge,they set regulations and everybody else MUST follow or else...!why do we have ICASA?Cell you either swim or sink,voda and mtn are in charge
In this high stakes poker game, Cell C realistically has no other option but to fold and accept the new rules.
Well either way they've dropped the rates, Cell C's being unreasonable by expecting an asymmetrical rate.
If that's not collusion and abuse of market power, then I don't know what is. It makes me sick to my stomach, really. Vodacom and MTN are doing everything in their power to protect their revenue stream and it's about time the Competition Commission takes them apart for it.
It should have been an assymetrical rate when Cell C entered. Cell C is actually trying to right a historical wrong and I understand their argument.
I hope its declined. Time for icasa to man up
Oh yay!We are now all happy and will conveniently forget everything.
Nope, they need to simply make every south African aware of the collusion and corruption of vodacon/mtn, which led to this issue.