ICASA wants more consumer freedom

The Independent Communications Authority of SA (ICASA) has released draft regulations that will allow consumers to choose which service provider they will use for every call they make.

The authority is calling for written submissions for its carrier pre-selection draft regulations. “The purpose of the regulations is to promote competition by giving end-users the ability to choose which telecommunications carrier they prefer when making calls,” says ICASA.

The proposition could be good news for consumers, if telecommunications providers don't hold the process back. Essentially, the regulations will allow a customer of, for example, Telkom to select Neotel to carry a particular call, should Neotel's rates be better for that call to a specified destination.

ICASA spokesman Sekgoela Sekgoela says these are only draft regulations and there will be many technicalities to iron out. However, he is confident the telecoms providers will submit their written and oral input.

The regulator has called for written submissions to be handed in by 9 January, and expects the oral hearings to take place on 21 and 22 January.

Globally, there are two forms of pre-carrier select: the first allowing consumers to select the carrier before the call, and the other allowing consumers to select a carrier during the call. The regulations proposed by ICASA will follow the first form, with a code that needs to be dialled before the consumer dials a phone number.

ICASA's draft regulations stipulate that all individual-electronic communications network services licensees will have to adhere to these regulations. This includes all the mobile operators, Telkom, Neotel and all the licensed value-added network service providers, like Vox Telecom and Altech Autopage Cellular.

However, Sekgoela says the regulations globally usually only govern the land-line operators.

“We need this regulation. It is one of the building blocks of competition,” says Irnest Kaplan, MD of Kaplan Equity Analysts.

He says that, while there are currently only two fixed-line players in the market, in a year or two there will be more. The carrier pre-select regulations will give those players an opportunity to market cheaper call rates and gain users.

“It will allow players to market specific routes at cheaper rates and it allows consumers to choose which provider will carry calls over the routes they want,” he adds.

However, Richard Hurst, programme manager of communications from IDC Africa, points out that the same system played out in the UK with unhappy results for the smaller telecoms players.

“Some of the smaller players, with limited infrastructure and user traffic, will not survive. The larger players can lower the prices beyond what the smaller telecoms businesses can generally afford.”

Globally, regulations governing carrier pre-select have been accompanied by local loop unbundling (LLU), a highly contested and long awaited issue in the local telecoms market.

Sekgoela explains that ICASA has been conducting committee meetings on LLU and hearings to discuss the process will start as early as January.

However, Kaplan says unbundling the local loop may not be required for the local version of these regulations. “The incumbents can just create a commercial agreement around the local loop, or last mile on the network. These agreements could stipulate how other telecoms businesses use the infrastructure and local networks of a particular player.”

He does see the value in unbundling the local loop. “Consumers being allowed to make a call using Telkom credits over Neotel's network infrastructure can seem unfair, since Neotel will be paying to maintain and repair that infrastructure.” Shared infrastructure, or unbundled local loop, will alleviate that sense of unfairness, he adds.

However, both Hurst and Kaplan agree that Telkom could slow the entire process of unbundling, as well as the carrier pre-select regulations, pointing out that the same delaying tactic has been used by global telecoms monopolies.

“It is all moving in the general right direction; it just may take longer than expected,” concludes Kaplan.

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