Despite a number of ongoing changes and initiatives around competition and the cost to communicate, South Africans feel they are being ripped off, while mobile operators bask in the profits gleaned from citizens exercising their right to communicate.
This is according to the Right2Know (R2K) Campaign, which this weekend handed memorandums to SA's four mobile operators, demanding they stop their "promotional gimmicks" and put all their customers - prepaid and contract - on their lowest call rate by the end of the month.
Noting that SA's mobile operators had spent much of the year embroiled in a fight with the Independent Communications Authority of SA (ICASA) over mobile termination rates (MTR), R2K says the country's mobile operators appear to be more concerned with revenues than South Africans' right to communicate.
On Saturday, after parallel protest action in Cape Town, Johannesburg and Durban, R2K handed letters to Vodacom, MTN, Cell C and Telkom Mobile, demanding they take action to "ameliorate" the cost of communication in SA.
The group says there is no reason for the cost of communication to stay so high, when the telecoms industry remains so profitable. R2K notes SA ranks 128 out of 144 countries in prepaid mobile rates - the largest chunk of the cellphone market. However, of recent times, SA's operators have been battling stagnant revenue and profit lines have come under pressure.
Mitigating costs
It has been about 16 months since ICASA launched its Cost to Communicate programme, which set out to address long-standing concerns around SA's high communications costs by finally addressing issues that had seen snags and delays, like digital migration, termination rates and local loop unbundling (LLU).
A year on, the regulator had failed to meet the 2014 deadlines it had set itself for LLU and digital terrestrial TV - but analysts at the time said the landscape had begun to shift, thanks to a price war and increased awareness around the need for lower prices.
Today, says ICT expert Adrian Schofield, ICASA has acted on the issue of termination rates, because of the threat of legal action hanging over its head, but progress in other areas has been limited. "The regulator didn't do a bad job with the MTR issue, and operators tried to show they are responding, with promotional price cuts. But not all consumers can take advantage of these and prepaid users to an extent end up being subsidised by those on contract that cannot reduce their costs - which are sometimes much higher than the going promotional rate."
LLU, says Schofield, has been delayed so many times, it is essentially a "dead duck" now. "The delay in making anything happen has been overcome by the changes in technology and no one is interested in how the last mile is connected now, because there are options that don't rely on Telkom's bits of copper."
BMI-TechKnowledge director Brian Neilson says MTRs are still on a downward glide patch and data prices are "still falling rapidly". The latter, he says, is driven more strongly by ongoing competition and enabled by trends such as growth in peering at NAPAfrica than due to government or regulatory intervention.
Senior research analyst at Ovum, Thecla Mbongue, says the cost of communications has declined since ICASA launched its programme, due to a price war. "For voice calls, the common pattern is to increase 'free' on-net talk time, but over the past six months, we've also seen cross-network call charges dropping on some prepaid packages on all networks - 79c cents per minute in early 2014 and dropping to 60c for instance in June 2014."
Responding to the demands R2K put in front of the operators, Richard Boorman, spokesperson for SA's largest mobile operator Vodacom, said lowering prices without investing in capacity was a recipe for congestion and frustration for consumers.
"The only way to bring prices down sustainably is to invest in additional capacity. We're investing R9 billion in our network in SA this year, despite our average effective voice price per minute declining 25% and our average effective price per MB of data dropping 30%."
R2K says it expects the operators to respond to its memorandums to them by 1 November. Cell C seems to have plans to meet with R2K over its correspondence, according to R2K.
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