Round 1, fight: ICASA vs. MTN vs. Vodacom vs. Cell C

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The saga surrounding the court battle between ICASA, MTN, Vodacom and Cell C took an interesting twist last night with the answering affidavit from ICASA stating its intention to reconsider the proposed cuts to mobile call termination rates (MTRs). The new MTRs, which are the costs that networks pay for calls from their own subscribers to ones on the other networks, are set to come into effect from the 1st of April 2014 with additional cuts taking place in 2015 and 2016.

According to its affidavit, ICASA wants to go ahead with the current planned cuts for this year but has “taken a decision to repeal the 2014 regulations insofar as they purport to regulate call termination rates beyond 31 March 2015”, in other words, the regulator wants to revise the proposed rate cuts for 2015 and 2016 but still have the 2014 rates go ahead as planned.

The fracas over the new MTRs is because they offer a level of asymmetry to help the smaller networks, Cell C and Telkom Mobile, by forcing MTN and Vodacom to pay a higher rate to the smaller guys than they would have to pay in return. The rates will see the smaller guys paying 20c/minute to the big boys with the reverse transaction costing the incumbents 44c/minute. Today’s hearing is over an urgent application by both MTN and Vodacom to have the new rates set aside and to force ICASA to go back to the drawing board to create a new set of rates.

ICASA says that the 2014 rates must go ahead on 1 April otherwise MTRs will be “effectively unregulated for the period of many months or years that the interim interdict endures” which is why the regulator has proposed changing the rates for 2015/2016 where it says “Much of the alleged irreparable harm relied on by MTN and Vodacom” takes place.

MTN and Cell C have made the most noise in public space over MTRs with the full-page advert and reply that we wrote about last week as well as Cell C’s fearless leader, Alan Knott-Craig, writing about the ‘make or break’ nature of this court case for the future of the mobile industry in South Africa.

Whatever the outcome of today’s high court verdict is, someone is bound to be unhappy and there will most definitely be appeals on the decision for months, perhaps even years, to come.

[Source: Tech Central]



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