Meeting on high cellphone rates continues

Wednesday, October 14, 2009

Pretoria - The meeting between cellphone giants and Parliament's Portfolio Committee on Communications will continue today.

They are discussing the state's proposal to cut mobile operator's interconnection costs before Christmas.

Interconnection rates are what cell phone companies pay each other for switching between networks.

Members of Parliament, who believe the rates to be exorbitant, hope that if the rates are dropped from 1.25 cents a minute to about 60 cents per minute, the savings would be passed onto consumers.

About 22 oral submissions are expected to be made over the two-day meeting.

Meanwhile, Communications Minister Siphiwe Nyanda has issued a directive to the Independent Communications Authority of South Africa (Icasa) to prescribe regulations for establishing a framework for interconnection services.

Icasa has 30 days in which to act.

The notice, published in the Government Gazette yesterday afternoon, calls for the regulatory authority to take into consideration the benchmark study undertaken in 2007.

The directive also calls upon Icasa to lower the interconnection rates in particular the mobile termination rate to a cost-base rate.

The notice found that the South African telecommunication costs were high in comparison to Brazil, Chile, Korea, India and Malaysia. It also found that the key contributor to South Africa's mobile call tariffs was excessive interconnection rates and mobile call termination rates.

Members of the public are also invited to send written submissions to the Communications Department.