Johannesburg, 21 Oct 2009
The means to cut interconnect rates to cost has been at the regulator's fingertips for the last five years.
Local alternative operator, ECN, which has been at the forefront of the interconnect debate, says there are already regulations in place that requires interconnect to be at a cost sliding scale.
In a surprise find, ECN CEO John Holdsworth says the company commissioned a legal review of the Chart of Accounts and Cost Allocation Manual (COA/CAM) regulations, which has been gathering dust since its inception.
The review found the regulations require the mobile operators to file revenue and cost information for interconnection charges with the Independent Communications Authority of SA (ICASA), so that the regulator can ensure the charges are cost-based and based on the operations of an efficient operator.
If the regulations hold, last week's public hearings on termination rates, held by the Parliamentary Portfolio Committee on Communications, would have been completely unnecessary. During the hearings, MTN and Vodacom agreed to meet in private with the committee to expound what the actual cost of interconnect is, saying 60c is below cutting even.
The regulations bring new light to the interconnect debate, since Holdsworth says it appears the operators have been acting unlawfully.
If these regulations do regulate interconnect, then ICASA already knows the cost of termination.
According to ECN's legal review of the COA/CAM set of regulations, the operators would have had to submit annual reports expounding the cost of interconnect, since they should have been on a cost sliding scale for the fees.
ICASA councillor Robert Nkuna's statement during the hearings indicating that cost for the operators would be no more than 40c, implies ICASA already has access to those details.
Holdsworth has written to the Department of Communications lambasting the operators' claims that a 60c interconnect fee is below cost and pointing out the relevant clauses in the regulations that would have kept costs down.
“There has never been a need for political intervention. We believe there has been complete regulatory failure,” says Holdsworth.
ECN says ICASA has failed in its duty, despite having access to the regulations, and Holdsworth adds that the consumer has had to pay for the cost of interconnect since.
“We believe that ICASA's apparent dereliction of its duties and the seeming disregard for the regulations on the part of the mobile operators has deprived consumers of affordable telephony and has raised barriers to much needed competition.”
Holdsworth says he is determined to take the fight to bring down interconnect to its end.
Share