Press release: ISPA Statement on the Dispute Regarding the ICASA Call Termination Regulations 2014

Published on: 2014-03-18

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The Internet Service Providers’ Association of SA (ISPA) supports ICASA’s intention to vigorously pursue the objective of more competitive markets without fear of the reactions of those whose interests will inevitably be compromised. The Association does, however, note that there are different views on how to achieve greater competition.

With regards to the urgent interdicts sought by MTN and Vodacom, should they be granted the implementation of the new glide path will be delayed at a politically inconvenient time and it will undoubtedly delay the creation of a more competitive landscape. The delay could be substantial, a result which is not in the interests of the South Africa consumer or economy.

Given these considerations ISPA urges the parties to the current dispute to take extraordinary measures to reach a negotiated solution outside of the court process.

“Whatever the outcome, the matter before the courts is important because it is likely to redraw the rules of engagement between the regulator and the regulated and between the policy-maker and industry. This shake-up will be long overdue,” said Dominic Cull, ISPA regulatory advisor.

The publication of the Call Termination Regulations 2014 revealed that ICASA is seeking to introduce a new glide path for the phased lowering of wholesale voice call termination rates as well as far more aggressively asymmetrical pricing in mobile termination rates.

ISPA’s members have an interest in and support fair and transparent regulatory processes and the rights of affected parties to seek the review of this action where they hold a good faith view that the required standards have not been met. While much has been written about the broader context and altruistic motivations for the court applications, this is at heart about Rands and cents, and both MTN and Vodacom are acting in a rational manner for profit-seeking entities which are taking into account narrow shareholder interests.

At the same time the fact that the Minister of Communications and the Portfolio Committee on Communications have been vocally supportive of ICASA’s intervention reflects the strong political and socio-economic considerations at play. Call termination rates are at the core of the “cost to communicate programme” and is one area of telecommunications regulation which is understood by politicians.

“ICASA’s intervention is more directly linked to the continued existence of what it regards as a mobile services duopoly and ICASA’s position that introducing greater competition will lead to lower prices. This follows from ICASA’s assessment of market and revenue share between the mobile networks, its conclusion that there is market failure and its view that the 2010 glide path and asymmetry have not remedied the market failure sufficiently,” concluded Cull.

Further Information

For further information, please contact the ISPA secretariat on the Contact ISPA page.