Court delivers partial victory for the Right to Communicate, but exposes Icasa's weaknesses

Yesterday's Court ruling on MTN and Vodacom's bid to stop Icasa's new Mobile Termination Rates (MTRs)[1] is a only a partial victory for the right to communicate, and exposes serious weaknesses in the regulator, the Independent Communications Authority of South Africa (Icasa). These weaknesses threaten the right to communicate in the longer term, as they allow a practically unregulated communications environment to continue .

While the Right2Know is acutely aware that MTN and Vodacom's litigation is opportunistic, in that it exploited serious weaknesses in Icasa's regulations, the South Gauteng High Court recognised that the reduced termination rates are necessary for the public good. Ordinary South Africans are paying some of the highest rates the world as our cell phone companies make profit margins well above global norms.

The court acknowledged the unjustifiably high airtime charges and recognised the need for Icasa to regulate to bring down the cost of communication. The reduced MTR rates will come into effect today (1 April 2014), but only for a six-month period.

The Court found that Icasa's specific proposed new rates were invalid because they had not followed the proper process. The court has ordered that the new rates must be reviewed and replaced within the next six months. In other words, the court has recognised the problem but ruled that Icasa's solution needed to be arrived at more carefully.

Two things have become clear. The first is MTN and Vodacom's willingness to exploit Icasa's obvious weaknesses to protect their stranglehold on the mobile-communication market and continue profiteering at the expense of the public's right to communicate. The two behemoths of the telecom sector are clearly determined to keep communication costs too high for most South Africans and frustrate the economic development that would flow from more affordable telecommunications. 

It is also clear that Icasa needs to get its act together to ensure that this temporary victory is not overturned. The court's ruling that Icasa's regulations were invalid and must be replaced are a warning to the regulator that haphazard efforts will do more to harm than help when it comes to protecting the public's right to affordable and quality communications.

In fact Icasa's poor efforts at regulation have forced Judge Mayat to substitute herself for the regulator - recognising that the remedy was in the public interest but Icasa's efforts were too weak to withstand challenge on the grounds of just administrative action. Icasa's work is all the harder in the face of corporate secrecy in the telecommunications sector. MTN and Vodacom have refused to provide their underlying cost structures even to the court. Icasa must now provide the accounting regulations that are necessary to force the network operators to provide their underlying costs

We call on Icasa not to back down in the fight to regulate the cost of communication. High MTRs are only one of the ways that the big telecoms maintain unreasonable profit margins. 

We call on the mobile opperators to ensure that reduced MTRs lead to reductions in the cost of airtime for the public. Furthermore, we call on the ICT Policy Review, currently being undertaken by the Department of Communications, to ensure that proposals are made to strengthen Icasa, as it does not appear up to task of holding the communications behemoths to account. 

The Right2Know Campaign, through its Vula 'ma Connexion programme to bring down communication costs, will keep fighting for South Africa's right to communicate by opposing future attempts at excessive profit-taking by mobile operators. We remain committed to mobilising for a more democratic communications landscape.

Footnote:

[1] What are Mobile Termination Rates? MTRs are the fees that mobile operators pay their competitors to carry across their networks. Icasa's new rates will see smaller operators (Cell C and Telkom Mobile) pay a lower termination rate of 20c/min; networks with a larger market-share (MTN & Vodacom) will pay a termination rate of 44c/min. The aim of reducing Mobile Termination Rates is to cut the cost of communication and introduce greater fairness and competition in the sector.

Download the full judgement here, courtesy of TechCentral.

Statement issued by R2K national spokesperson, Murray Hunter and R2K telecoms convenor, John Haffer, April 1 2014

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