Vodacom urges ICASA to lower termination rates

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As previously indicated, Vodacom is supportive of lower mobile termination rates.

Our key request to ICASA has been to consider the adverse impact of lower termination rates on our customers, our partners and our suppliers. To this end, we had proposed a reasonable reduction glidepath.

Our recommendation has not been accepted and we will be reviewing the potential impact both internally and externally.

We will be in a better position to comment on the steps we will need to take to adjust our business model once that review has been completed.

Vodacom had also made representations to ICASA about the proposed asymmetry structure, which is now more aggressive to the detriment of Vodacom’s customers and business. We feel that the level of asymmetry is unjustified and that there is no clear basis for the differential. This asymmetry is clearly a subsidy for the smaller operators.

We believe that the outcome today has been reached without following due process. A cost-based study, which is a prerequisite before reaching this type of decision, has not been conducted and shared with us. We will be considering our options in relation to this.

“I wish I could say this is a victory for the consumer, but it is far from it. This is a subsidy which in effect means that Vodacom will be charged more to call Cell C and Telkom Mobile than the latter will be charged to call Vodacom. This prejudices Vodacom’s customers, and rewards those who have not invested in their networks at the expense of those who have,” said Shameel Joosub, Vodacom CEO.

“We will consider our options in order to do our best to protect our customers and ensure that South Africa continues to get the network investment that it needs and deserves.”

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