Cellphone giants agree to lower termnation fees
October 23, 2009
South Africa's largest mobile phone operator Vodacom and its rival MTN said on Friday they had reached an agreement to cut interconnection rates.
South African mobile phone operators charge 1.25 rand ($0.168) per minute at peak times for their interconnection fee, a charge to enable calls to be transmitted from each other's networks.
Vodacom said on Friday its agreement with MTN proposed a blended interconnection rate of 78 cents, which declines to 61 cents on a glide path.
"Unfortunately Vodacom has been unable to reach agreement with (smaller rival) Cell C who has insisted on an asymmetric approach," the company said in a statement.
Vodacom interconnection revenue, which included income from South Africa's third largest mobile phone operator Cell C for national roaming services, rose by 8.6 percent to 8.63 billion rand ($1.16 billion) for the year to end-March.
MTN, South Africa's second largest mobile operator and Africa's biggest, raised its interconnect revenue to 6.9 billion rand in the year to December compared to 6.3 billion in 2007.
Reporting by Gugulakhe Lourie
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