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MTN SA CEO – ‘new call termination rates a departure from 2010 regulations’

February 6, 2014 • Mobile and Telecoms, Southern Africa

 

Zunaid Bulbulia, Chief Executive Officer of MTN South Africa (Image source: file)

Zunaid Bulbulia, Chief Executive Officer of MTN South Africa (Image source: file)

In response to new Call Termination rates that were announced by the Independent Communications Authority of South Africa (ICASA) on 29 January, mobile operator MTN South Africa has issued a response stating that the new rates “represent a substantial departure from the 2010 Call Termination Regulations…”

Last week, the Authority announced new Call Termination Rates or the fees one network charges another for calls received or terminated on its network. Following notification from ICASA, the incumbent mobile cellular operators are expected to reduce their Mobile Termination Rate (MTR) from 40c to 20c as of 1 March 2014. The MTR’s for small mobile operators will remain at 44c.

The government echoed the sentiment of some service providers in reaction to the announcement and said it welcomed ICASA’s decision and believed it serves the country’s interest.

In the statement the Company’s CEO, Zunaid Bulbulia said MTN South Africa said that the Company had previously stated its willingness to co-operate with the Authority to work towards reducing the cost of communication.

Bulbulia added:  “The regulation setting out the pertinent detail and the explanatory memorandum containing ICASA’s reasons have unfortunately not yet been published. As a result it is difficult for MTN at this time to meaningfully comment on the full context of the issue. We trust that those documents will be published as soon as possible so that MTN could analyse the content in detail. Once those documents have been disclosed MTN will be in a position to respond with the next steps,

Suffice to say that the Call Termination rates announced by ICASA represents a substantial departure from the 2010 Call Termination Regulations which set an important regulatory precedent in relation to matters such as cost-orientation of the rate-setting, a managed glide path, and declining asymmetries. Additionally, MTN does not support the proposed mobile asymmetrical rates (i.e. competitive cross-subsidies) and believe these to be unsubstantiated. MTN will also have to scrutinise and consider a number of other due process concerns once the regulation is published.

In this regard, MTN is considering all its options,” he said.

Chris Tredger – Online Editor

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