ISPA queries reduction in fixed call termination fees


Internet Service Providers of South Africa (ISPA), Sasha Booth-Beharilal

JOHANNESBURG, (CAJ News) – THE Internet Service Providers of South Africa (ISPA) has questioned the recently announced reductions in fixed call termination rates.

ISPA described the reductions as “aggressive.”

It furthermore called for implementation of the planned convergence of mobile and fixed call termination rates towards eventual parity.

Call termination rates are fees charged by telecoms networks to ensure calls originally placed by a subscriber on one network can reach or terminate a subscriber on another network.

ISPA noted these costs are worthy of interrogation as they are almost always passed on to the end telecoms consumer.

The Independent Communications Authority of South Africa (ICASA) has decided not to align South Africa’s fixed termination rate with the mobile termination rate.

ICASA believes this move goes against ICASA’s own findings that acknowledge the convergence between fixed and mobile, driven largely by the COVID-19 pandemic.

The regulator said in a recent notice that it wants mobile termination rates slashed from 9c/minute excluding VAT (13c for smaller operators) to 7c (9c) on July 1 2024 and 4c (4c) on July 1 2025.

The proposed cuts to fixed-line termination rates are seen as more aggressive. From 6c/minute now, ICASA wants these reduced to 4c from July 1 2024 and to 1c from July 1 2025.

Telkom, South Africa’s fixed line operator, has already expressed dismay at ICASA’s decision to cut fixed call termination rates and mobile termination rates asymmetrically.

Sasha Booth-Beharilal, ISPA chair, said, “The argument for parity has little to do with interconnection revenue, but rests on the fact that the distinction between fixed and mobile calls is blurring.”

“The result is that the average cost of terminating a fixed call is now the same, if not more expensive, than terminating a mobile call,” Booth-Beharilal added.

The first call termination review took place around 2010, resulting in ICASA imposing glide paths for the reduction of termination paths. Under ICASA regulation, call termination rates have been substantially reduced since 2014.

– CAJ News

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