Parliament pressures Icasa over rate cuts
October 28, 2009
 By Ann Crotty
The Parliamentary portfolio committee on communications has asked the Independent Communications Authority of SA (Icasa) for its authority to fire all of its councillors should it miss its own March 2010 deadline for finalising the process of regulating mobile interconnection rates.
Icasa, which appeared before the parliamentary committee for the second time in as many months, said it was important that the process required in terms of chapter 10 of the Electronic Communications Act (ECA) was followed.
"In attempting to fast-track a remedy we must be sure that we do not fall foul" of the Promotion of Administrative Justice Act, said acting Icasa chairman Robert Nkuna.
Nkuna confirmed that Icasa had abandoned its efforts to use "moral suasion" to get the operators to reduce rates.
"We agreed to moral suasion after the cellphone operators had indicated to us that they were prepared to effect some reduction in interconnect rates, but on Friday it was apparent that discussions between the operators had broken down; we were not prepared to facilitate ongoing discussions between only the two majors MTN and Vodacom as that was collusion," said Nkuna, adding that future engagements with the operators would be on the basis outlined by the committee and the Department of Communications.
Johnny de Lange, an ANC member of the committee, accused the operators of obfuscation and attempting "to mess" with Icasa and Parliament. He repeated demands that they disclose interconnection costs and that these be used to set interconnection rates.
Icasa drew attention to the increase in interconnection rates between 1999 and 2001, when the rate was hiked from 20c a minute to R1.20. The increase was set by MTN and Vodacom. When asked why Icasa allowed this increase, Nkuna said Icasa had no authority over price setting.
Icasa must complete all of the processes set down in chapter 10 of the ECA before it has any power over pricing.
Industry analysts have said that MTN and Vodacom hiked the interconnect price ahead of Cell C's entry into the market to weaken Cell C, as it immediately had high operating costs.
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