Cellphone network operators MTN and Vodacom took their fight against the introduction of new call termination rates to the High Court in Johannesburg on Tuesday.<\/p>\n
The Independent Communications Authority of SA (Icasa) has conceded there are problems with its proposed model for mobile termination rates.<\/p>\n
These are the rates that operators have to pay one another for calls to other networks.<\/p>\n
Icasa wants to implement a set of regulations that will see these rates dropped to 10 cents per minute in 2016.<\/p>\n
For 2014, however, MTN and Vodacom will have to pay 44c a minute to smaller operators, while the smaller companies will have to pay only 20c.<\/p>\n
MTN and Vodacom want the 2014 regulations scrapped. Alternatively, they want interim relief to prevent the introduction of the new rates until they have been reviewed.<\/p>\n
Wim Trengove, SC, for MTN, argued it was unfair to make the rates asymmetrical beyond newcomers to the mobile market.<\/p>\n
If the proposed regulations were implemented from April 1, the smaller operators would effectively be receiving a subsidy.<\/p>\n
“MTN and Vodacom customers will have to pay a higher rate to subsidise Cell C, Telkom Mobile, and their customers,” Trengove argued.<\/p>\n
There were also questions about how Icasa had arrived at the proposed rates, which it claimed would stimulate competition in the mobile market.<\/p>\n
Trengove said MTN could lose R450 million in revenue if the new rates were implemented before a review of the rates regulations, which could last around six months.<\/p>\n
Alfred Cocknell, SC, also for MTN, argued there were issues of procedural fairness in Icasa’s dealing with the regulations.<\/p>\n
He said MTN had sought to make submissions on the draft regulations, but was not given the relevant information to make meaningful submissions.<\/p>\n
MTN asked for the costing study and regional or global benchmarking studies that informed the regulations.<\/p>\n
“Icasa refused to give these.”<\/p>\n
Icasa refused to reveal the method it used to arrive at the new rates, which Cocknell referred to as a “black box”.<\/p>\n
“My client could not make a meaningful submission without that black box.”<\/p>\n
Cocknell said there could be significant changes to the structure of the market if the court did not grant the application.<\/p>\n
Icasa delay saves MTN R286 million<\/strong><\/a><\/p>\n MTR cuts would cost us R1 billion: MTN<\/strong><\/a><\/p>\n