ICASA, the independent body responsible for regulating the communications sector in South Africa, announced this morning that it will publish a final version of the draft regulations it originally proposed in October last year.
It confirmed that the proposed measures for asymmetry would go into effect on the 1st of March, this year. Asymmetric rates simply mean that some providers will pay less than others, when it comes to connecting calls. In this case, the regulations were created to stimulate growth and help smaller operators.
The full regulations call for dropping call termination fees over a period of three years for regular rates, and four years for asymmetric rates.
ICASA’s regulations call for termination rates, as of 1st March this year, to drop to 20c per minute for calls to networks that have more than a 20% market share. Meanwhile, the asymmetric rate will be 44c per minute for calls to networks that have less than a 20% market share.
In the real world, where both Telkom Mobile and Cell C have less than 20% of the mobile market share, each, it means that a Vodacom user will be charged 44c per minute when calling Telkom Mobile or Cell C customers. Conversely, a Cell C subscriber will only be charged 20c per minute when calling somebody on Vodacom or MTN’s network. Think of these as toll fees: if you’re Vodacom or MTN, visiting Cell C or Telkom Mobile is expensive. And if you’re one of the smaller guys, visiting Yebo and Ayoba is a lot cheaper.
This translates to lower fees for smaller operators, when connecting calls, and they can thus be more aggressive with their pricing.
ICASA’s full regulations call for a reduction in rates, over time. March 2015 will see the rates drop to 15c and 42c; March 2016 sees another drop, to 10c and 40c. There’s a stipulation for 2017, too. If any provider has less than a 10% market share in 2017, they’ll have a termination rate of 20c per minute.
There are also revised call termination rates for fixed lines. These are the fees that mobile operators will have to pay to Telkom for calls that terminate on its network. Those also feature asymmetry.
Fixed-line termination rates are as follows:
2014: 12c for local calls, 16c for long-distance calls
2015: 12c for local calls, 12c for long-distance calls
2016: 10c for local calls, 10c for long-distance calls
2014: 13c for local calls, 21c for long-distance calls
2015: 13c for local calls, 13c for long-distance calls
2016: 13c for local calls, 13c for long-distance calls