Mobile operators should accept new MTRs – Carrim

South African minister of communications Yunus Carrim has said the country’s mobile operators should accept the Independent Communications Authority of South Africa’s (ICASA) decision to impose asymmetrical mobile termination rates (MTRs).

ICASA has announced termination rates will be cut to ZAR0.20 from ZAR0.40 as of March 1, 2014.

Carrim urged the operators to accept the new rates, even if some of them, such as Vodacom and MTN, may have lost out. Operators with more than 20 per cent market share will have higher rates imposed upon them.

“What some of them may lose in immediate profits will be exceeded by what they will gain in the medium and long term,” he said.

“We welcome ICASA’s decisions and believe they serve the country’s interests. We would like to see these new rates contribute to consumers and business paying less to communicate and benefitting economic growth and job creation over time. The high costs to communicate have deterred global and domestic investment in this country.”

HumanIPO reported today Vodacom had spoken out against the asymmetrical nature of the decision, stating it was not a victory for consumers.

“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, chief executive officer (CEO) of Vodacom.

Both Cell C and Telkom Mobile, however, have welcomed the lowered termination rates.

Carrim said: “These rates provide for greater competition which we expect to lead to reductions in the cost to communicate.”

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