The National Consumer Commission (NCC) has launched a full-scale investigation into mobile networks\u2019 price increases for contract subscribers.<\/p>\n
Major networks Vodacom and MTN announced increases to cellular contract tariffs earlier this year, while Cell C also announced contract price hikes in December 2014.<\/p>\n
Subsequently, the NCC said it has received 32 complaints from consumers who felt that networks were acting unfairly when increasing prices in the middle of contract periods.<\/p>\n
The NCC then launched an inquiry to study each complaint and requested information about general mobile network practices from the Independent Communications Authority of South Africa.<\/p>\n
\u201cThe NCC has, after receiving all requested information and after assessing all complaints in respect of the provisions of the Consumer Protection Act and its regulations, concluded that a reasonable basis exists to institute a full-scale investigation,\u201d NCC spokesperson Trevor Hattingh told Fin24.<\/p>\n
The probe is expected to be completed in 12 months and will specifically study the \u201ccompliance of contract terms and conditions of cellphone service providers\u201d, Hattingh said.<\/p>\n
\u201cAs such we will audit the terms and conditions of mobile network service providers in relation to the provisions of the Consumer Protection Act and its regulations,\u201d Hattingh told Fin24.<\/p>\n
He said that in 2012 the NCC conducted an audit on all cellphone networks, which resulted in them bringing their terms and conditions to a 99% compliance rate.<\/p>\n
Rising costs<\/strong><\/p>\n South Africa\u2019s two biggest network providers have alluded to rising costs as grounds for contract price hikes.<\/p>\n MTN pinned its price increases on rising mobile termination rates, increased network investments, transport costs, handset price increases, falling exchange rates and higher taxes.<\/p>\n In March, Vodacom told Fin24 that its increased network upgrade spend meant that its investment per subscriber has grown from R218 per customer in 2013-2014 to R269 per customer in 2014-2015.<\/p>\n Falling mobile termination rates also resulted in Vodacom being hurt by a R2bn service revenue knock for the financial year ended March 2015.<\/p>\n Fin24<\/a><\/p>\n Telkom Mobile nears break-even point<\/a><\/strong><\/p>\n Best and worst mobile networks in South Africa<\/a><\/strong><\/p>\nMore on mobile in SA<\/h3>\n