Connecting Africa is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 3099067.

4G/5G

Telkom Slams ICASA's Termination Rate Ruling

Article Image
PRESS RELEASE -- Telkom today issued a counter-proposal to telecoms regulator, the Independent Communication Authority of South Africa (ICASA), following the publication of a new proposal which would see Telkom continue to effectively subsidise the larger mobile network operators.

Despite being one of the smaller operators, Telkom is a disruptive operator in the voice market which offers lower prices and better value. However, ICASA continues to require what amounts to a subsidy for large mobile operators through regulation. The latest such requirement is the proposals around call termination rates. These are the rates paid by operators to each other when a consumer makes a call to someone who is on a different network and which form part of the overall call cost.

“ICASA’s decision to reduce fixed termination rates at a faster pace than the reduction in mobile termination rates would entrench the duopoly of the largest mobile operators and reduce competition. It is also out of kilter with convergence in technology,” said Telkom Group CEO Sipho Maseko.

ICASA has proposed that fixed termination rates (FTRs) should fall by 70% compared with a reduction of only 31% in base mobile termination rates (MTRs). The small reduction in MTRs represents a missed opportunity to reduce the cost to communicate for the large majority of South African telecoms users and disproportionately targets Telkom, said Maseko.

ICASA should review termination rate setting to align with the South African market reality and the global convergence in technology which no longer distinguishes between fixed and mobile. South Africa should be working towards symmetry between fixed and mobile termination rates in a manner than enables fair competition and reduces the cost to communicate, according to Telkom.

Telkom’s counter-proposal is that ICASA continue to maintain higher levels of asymmetry as it continues a review of the cost modelling and other regulatory streams such as the determination of South Africa’s priority markets. The proposed FTRs require cost reductions that are not feasible within a three-year time frame without significant job losses and do not recognise that the telecoms landscape has changed to such an extent that there is one converged voice market, rather than separate fixed and mobile markets.

The lasting impact of these decisions could well be working against ICASA’s objectives to promote competition and continue to reduce the cost to communicate for South African telecoms users, Maseko concluded.

ENDS

Innovation hub

Video

Interview: Qualcomm execs on mentorship for African startups

Qualcomm Technology VP for Engineering, Sudeepto Roy, and Elizabeth Migwalla, VP for Government Affairs, join Connecting Africa for a video interview about Qualcomm's Make in Africa Mentorship Program.

Story

Hot startup of the month: Pan-African fintech KamaPay

This month's hot startup is pan-African fintech KamaPay, which helps individuals and businesses make cross-border payments on the continent.

More Innovation hub

Latest video

More videos

Sponsored video

More videos

Industry announcements

More Industry announcements

Flash poll

All polls

Africa Tech Perspectives

Story

Deep dive into East Africa's tech startup ecosystem

New survey reveals a lack of access to investors, reliance on international VCs and global recession trends as the biggest barriers for East African tech startups to access funds.

Story

Challenges and opportunities for women's tech careers

A new survey reveals that COVID-19, the cost-of-living crisis, skills shortages and a lack of mentorship have negatively affected women's career development over the past two years.

Story

Survey: Opportunities for Women in Tech

Take our new survey for women across Asia, Europe and Africa looking at the biggest challenges and opportunities for women-led enterprises and trends in tech careers for women.

More AfricaCom perspectives

Upcoming events

London Tech Week
June 13-16, 2023
Queen Elizabeth II Centre, Broad Sanctuary, London SW1P 3EE
Cybertech Africa 2023
August 1-2, 2023
Kigali Convention Center, Kigali, Rwanda
Africa Tech Festival, Home of AfricaCom and AfricaTech
November 13-16, 2023
CTICC, Cape Town
More Upcoming events

Guest Perspectives

Story

Omdia View: February 2023

By Omdia Analysts

In February 2023 key events in the Middle East and Africa included a major Internet project for Africa's underserved by Liquid Intelligent Technologies and Microsoft as well as a 5G launch in Tanzania – that and more in this month's Omdia View.

Story

Omdia View: July 2022

By Omdia Analysts

Kenya and Zambia move towards 5G with new spectrum allocations while Tunisie Telecom plans to shut down its 3G network - that and more in this month's Omdia View.

More Guest Perspectives

Partner perspectives

All Partner Perspectives

Like us on Facebook

Newsletter Sign Up


Sign Up