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Icasa may make U-turn on call rates

Cape Town - South Africa's telecoms regulator said on Monday it may reconsider planned cuts for 2015 and 2016 in the amount mobile operators charge each other to use their networks.
 
"In this case, we may review 2015 and 2016 mainly in trying to avert a very lengthy legal challenge. We will be re-consulting for those years," said Paseka Maleka, a spokesperson for the Independent Communications Authority of South Africa (Icasa).

In February Icasa said that Mobile Termination Rates (MTRs) would be cut to 20c from 40c from March 1.

It also proposed a further reduction to 15c by 2015 before settling at 10c by March 2016.

Icasa subsequently changed the starting date to April 1, mainly due to the court challenge by mobile operators who fear revenues streams will be curtailed.

Mobile operators MTN and Vodacom have asked a Johannesburg court to halt plans by Icasa to halve the fees operators charge competitors to carry calls on their networks.

The cuts would have benefited Telkom Mobile and Cell C, and the issue has seen virulent discussions in the industry.

"I'm disappointed - what I can say is that we're respondents to their initial affidavit and we will do what it takes and we will respond," Cell C acting CEO Jose Dos Santos told sister publication News24 about the impending lawsuit.

The operator has launched a marketing campaign aimed at MTN, but radio ads were deemed unfair and the Advertising Standards Authority ordered Cell C to withdraw them.

Vodacom [JSE:VOD] estimated revenue loss at R1bn in the next financial year, while its larger rival MTN Group [JSE:MTN] is expected to fare better given its diverse geographic base and customer profile.

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