'ICASA must account for Vodacom'

By Candice Jones, ITWeb online telecoms editor

Johannesburg, 04 Jun 2009

The Congress of South African Trade Unions (Cosatu) has lambasted the Independent Communications Authority of SA (ICASA) for not acting sooner to stop the sale of Vodacom.

Speaking at a press conference this afternoon, Cosatu secretary-general Zwelinzima Vavi explained that ICASA's actions, through the process of the sale of Vodacom to Vodafone, will need to be “debated” to determine whether the regulator had “failed in its duties”.

Vavi said if ICASA is found to have failed, then it does not deserve to continue being the country's communications regulator.

The congress has an outstanding legal application against ICASA's decision to allow Telkom to release Vodacom into the hands of Vodafone, which now owns 65% of the South African mobile business.

ICASA joined Cosatu in a last-minute bid to prevent Vodacom from listing, just a few days before the company hit the bourse. “What we want to know now is whether ICASA will have scheduled public hearings in the middle of June and what they hoped to get from it,” noted Vavi.

However, the congress's leadership is not convinced ICASA will have any effect on the situation. “I can't imagine they will have the guts to reverse the sale,” he added. Cosatu said it will meet with ICASA's leadership to gain clarity on these issues.

“We want our members to have their due rights; rights to collective bargaining power,” said Vavi.

Missed opportunities

Meanwhile, Vodacom CEO Pieter Uys has arranged a meeting with Cosatu to discuss the issues that have been raised over the last few weeks. Cosatu will be joined in the meeting by the Communication Workers Union.

Cosatu has also decided not to go ahead with its threat of a boycott of Vodacom services, saying: “Legal constraints signed by consumers, including unions, make this a difficult campaign to sustain.”

The congress still feels it had a valid case in its attempts to prevent the listing of Vodacom. “However, we missed that opportunity. We are concerned that the only drive for Vodafone will be profits. Will they have the drive to still roll-out efficient telecoms instead of just profiteering?”

Cosatu said it will try to get more clarity on the deal when it meets with Vodacom. “We want to understand, in greater detail, what the impact of the 65%-35% split will be,” explained Vavi.

He said there is already an impact of the sale, evident through the service offered by Telkom. “As far as we can tell, Telkom is more of a disaster daily. Not rolling out in rural areas. As you know, most of Telkom's profits came from the 50%-50% ownership.”

Cosatu said it would have been better if Telkom had maintained its ownership because the sale will only keep telecoms prices high. “Prices are still far too high in the country.”

Vavi said government could have used the Vodacom profits to roll-out more efficient telecoms services in SA, if it still had a hand in the company. After the listing, government owns 13.8% of Vodacom and has agreed to hold its shareholding for a year.