The Communications Users Group of SA (CUASA) believes the latest cellular tariff increases are a deliberate attempt by the industry to discourage the use of least-cost routing (LCR).
According to CUASA, LCR providers currently bypass Telkom`s network by essentially plugging a cellphone directly into a company PABX.
The PABX then utilises this cellphone line when users wish to phone other cellular numbers - a practice that currently saves business consumers millions each year. However, with the new proposed tariffs, this practice could end up costing businesses more.
"It seems the cellular operators have recently discovered they have either been losing money - or not making enough - on calls they carry to the other two cellular operators," says CUASA spokesman Ray Webber.
"Aside from the usual inflationary increases, they have built in the renegotiated interconnect percentages, which in some cases translates to a 63% increase for the end-user."
He says that while these tariff increases can be seen as part of the reality of increased competition, CUASA`s members are irked by the way this was thrust on them without any prior notification or warning.
"MTN and Vodacom in particular have been punting LCR to their customers for years, but now with the increased rates they`ve effectively pulled the rug out from under the users," he says.
"The operators are in essence forcing LCR users away from making off-net calls (those to the other networks) by dramatically increasing the cost of these calls, so now businesses will either have to cough up the exorbitant increases or install all three networks to their LCR system, thereby routing each specific cellular call through the relevant operator`s network."
He says the problem with this is that companies may have to cancel some of their existing contracts with an operator - possibly incurring cancellation penalties, not to mention the added administration of reconciling different accounts, and the complexities of upgrading the PABX system to differentiate between the three cellular networks.
"The new tariffs make Telkom`s rates that much more competitive, so the cellular providers are playing into the monopoly's hands and I can`t help being a little suspicious that pressure is being brought to bear on them from some quarter.
"Remember, Telkom is currently pursuing a court case to declare LCR systems illegal, and the less cost-effective this option becomes for businesses, the higher the benefit to Telkom," says Webber.
Malcolm Turnbull, national sales manager for specialised services at Nashua Mobile, says the important thing with LCR is that a full client needs analysis should be conducted before anyone chooses to use it.
"What people need to realise is that in the beginning, LCR used to be a bit like clubbing seals, but it has now become a very specialised service," says Turnbull.
"As long as the consumers look at the LCR service in its entirety and understand how it operates, they will see that it is most definitely not a dead market - there is certainly still a place for LCR."
According to Webber, CUASA is appealing to the Independent Communications Authority of SA to approach the cellular providers to reverse these increases or at least amend them.
"We believe that there should be no additional cost, or at least very little, when making a call from one cellular provider to another," he says.
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