- The Congress of South African Trade Unions (COSATU) has called for a total investigations of all pricing structures in the telecommunications services in order to avoid the migration of costs to other charges by service providers.
"While we are of the view that while the objectives of this process are correctly defined in relation to addressing the “exorbitant and excessive” rates as well as “historical collusion”, we do not believe these would be adequately served by limiting the investigation to interconnection rates, as opposed to extending it further to other aspects of the pricing structure of ALL forms of telecommunication services," COSATU said in a statement presented to the Parliament Portfolio Committee on Communication today.
The statement also warned that unless a wholesome all pricing investigation is carried out, the country and consumers run the risk of mobile phone networks replacing loss of interconnection revenue by increasing other charges.
"This would entail focusing on both mobile and fixed telephony as well as internet services," said the trade union adding that particular attention should be given to the lack of parity regarding call charges applied between contract and pre-paid customers, both during peak and off peak times.
The union further mentioned the disproportionately expensive call rates applicable to fixed local access as compared to the relatively inexpensive call rates for fixed long distance domestic calls and international calls. "Again this pricing approach is designed to disadvantage lower-income customers who will more commonly make local rather than long distance calls," COSATU said amongst others.
"In our previous submission on the pricing structure of telecommunication services, we have emphasised both “universal access” and “affordability”. Universal access is often misconstrued as being limited to the roll out of infrastructure and the effective potential geographic coverage of a particular service. However, as with other basic services such as water and electricity, once access is cut off on the basis of unaffordability, then universal access becomes a concept that is possible in theory only, the union said in the statement.
It continued that the cell phone network industry has been afforded sufficient time to address problematic pricing structures on their own initiative but have failed, saying no allowance should be made for them to further delay the process.
"We believe that the Committee should act decisively to correct the current problems in the pricing structure and arrangements applicable to telecommunications. However, we again would like to reiterate our call for further investigation of other pricing irregularities as expanded above with the emphasis being on addressing affordability and universal access," said COSATU.
Meanwhile, the MTN Group and Vodacom have both made the commitment to look into the issue of what has been said to be the excessive and exorbitant costs of mobile termination rates (MTR) in the industry, which is the fee one network charges another for receiving calls on its network.
The parliamentary committee was yet to hear, at least from the MTN, the issue of costs, but in a closed session, while the Vodacom Group had declined.
Service providers have also asked for the reduction in costs to be implemented gradually to avoid any fanicial shocks to the industry.
South Africa is said to be one of the most expensive in mobile and interconnectivity as well as internet costs in the region, though boasting to host two of the continent's biggest mobile players.
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