ICASA 'lets operators off the hook'

Paul Vecchiatto
By Paul Vecchiatto, ITWeb Cape Town correspondent
Cape Town, 25 Nov 2010

Members of Parliament lashed the Independent Communications Authority of SA (ICASA) yesterday.

This followed the MPs' realisation that the interconnection regulations did not lead to a direct lowering of mobile retail costs. They then demanded more hearings.

The regulator was reporting to the Parliamentary Portfolio Committee on Communications on the regulations that were promulgated in the Government Gazette on 29 October.

This report was supposed to be the end result of the public hearings held by this committee last year into the high costs of mobile fees driven by the charges the operators levied to terminate calls on each others' networks.

However, the news was not what the MPs wanted to hear. They attacked ICASA for taking too long to bring down the interconnection rate, and the fact there has been little or no difference in the retail charges since then.

“What am I supposed to tell my constituency when they ask me when do the rates come down?” asked one ANC member.

Democratic Alliance deputy shadow communications minster Niekie van den Berg stated: “ICASA is toothless. This lets the operators off the hook. ICASA is afraid of the industry it is supposed to regulate.”

Committee chairperson Eric Kholwane said: “The public say ICASA is the little boy of the industry.”

In terms of the regulations, the industry has until 2013 to gradually reduce their call termination rates to 40c from the current 89c level. The regulations allow for the operators to reduce their interconnection fees to 73c and an off-peak rate of 65c from 1 March 2011 to 28 February 2012.

The fees will then fall to 56c and 52c for on- and off-peak charges respectively, and from 1 March 2013 they will fall to a standard charge of 40c.

These rates would not necessarily apply to the smaller operators such as Cell C, but would have to be followed by the dominant operators Vodacom and MTN.

The ICASA delegation, including chairman Stephen Mncube and councillor Thabo Makhakhe, attempted to justify the regulations using technical explanations. This included why it was more difficult for mobile operators to hand off calls to each than it was for fixed-line operators to do so.

However, the politicians demanded further explanations of the regulations in plain language.

“Please no more of this Greek, put all of this in 'Nguni-English',” said Faith Muthambi (ANC).

Makhakhe said ICASA had resisted pressure from the network operators. He pointed out that the dates that were selected coincided with the various companies' financial year-ends so that budgets could be adjusted accordingly.

Mncube pointed out that ICASA could not just issue regulations that would disrupt the market.

“MTN has already had to retrench 2 000 staff; we must manage this implementation,” Mncube said.

Kholwane ended the meeting by saying that although the committee had expected this report to have been a simple one, it would need at least a full day during next year's parliamentary session.

Related story:
Interconnect battle laid to rest?