In South Africa, the Internet Service Providers Association (ISPA) has raised concerns about the proposed drastic reduction in fixed-line call termination rates by the Independent Communications Authority of South Africa (ICASA).
The wholesale rates, which operators charge for calls carried between their networks, have been steadily declining over the past decade as ICASA has worked to reduce the cost of communication in the country. However, ISPA has now warned that the regulator may have gone too far in proposing that fixed call termination rates be reduced to just 1c/minute by next year.
ISPA has also questioned why ICASA has not moved to align fixed and mobile call termination rates. According to Ispa chairman Sasha Booth-Beharilal, the argument for parity between the mobile and fixed rates 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,” he added.
Telecommunications giant Telkom has also expressed dismay at the proposed new rates, calling them “drastic”. The company has called for parity between fixed and mobile termination rates, stating that “the authority’s decision not to align the fixed termination rate with the mobile termination rate” has caused concern.
It remains to be seen whether ICASA will heed the concerns raised by ISPA and Telkom. However, the proposed reduction in fixed-line call termination rates has raised eyebrows among industry insiders. As South Africa grapples with the effects of the Covid-19 pandemic, it remains to be seen how the proposed rate cuts will impact the country’s telecommunications sector in the long run.
