Carrim has hands tied but scolds Vodacom

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Vodacom is launching a court bid to fight the mobile call termination rates set by Icasa. Photo: Simphiwe Mbokazi

Johannesburg - The Minister of Communications, Yunus Carrim, has weighed in against cellular operators after Vodacom filed papers against the Independent Communications Authority of SA (Icasa) in the South Gauteng High Court this week over call termination rates.

Vodacom, South Africa’s largest cellphone network operator, sought an interim order to review the process which Icasa followed to arrive at significantly lower new call termination rates, which are rates that operators charge to receive calls on each other’s networks.

Carrim, who emphasised that he could not interfere unless it was legally tenable and Icasa had requested his assistance, said the state recognised Vodacom and MTN’s right to approach the court and their right to realise an appropriate rate of return for further investment.

“But they must also recognise the need of the economy as a whole whose growth is not reaching targets that were set out. One of [the reasons] being the cost to communicate. We think it’s unnecessary for Vodacom to have gone to court.”

Carrim said Icasa, an independent body established by an act of statute, ultimately had the final say. It could decide on more stringent connection rates or asymmetry.

“We are very clear we think the private sector is crucial [but] there’s far too high a level of monopoly in this sector and other sectors,” he added.

Carrim returned yesterday from the 2014 GMSA Mobile World Congress in Spain where a key consideration was the need to lower the cost to communicate. “Even the [international] mobile operators are having a strong social conscience about having these inequalities reduced… I’m just pleading that they [South African operators] become more attuned to what the World Mobile Congress is saying.”

The Right to Know Campaign yesterday called on MTN and Vodacom to drop their lawsuits and “stop profiteering”.

Vodacom spokesman Richard Boorman said discussions over the past few weeks were fruitless, leading to the court action.

Vodacom chief executive Shameel Joosub said the operators did support Carrim but that Icasa had failed to conduct a detailed cost study as required by regulatory best practice. Icasa also proposed an unprecedented level of asymmetry. “This means that by 2016, Vodacom will have to pay four times more to connect a call to the smaller networks than they will have to pay to connect to Vodacom.”

Last week Icasa postponed the implementation of the call termination rates by one month to April 1, to attend to the MTN lawsuit, which is also seeking a review and to set aside the rates.

Icasa spokesman Paseka Maleka said the regulator had not yet received court papers from Vodacom. - Business Report


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