The Independent Communications Authority of South Africa (ICASA) will not investigate Vodacom’s Free4Sho price plan amidst suggestions that it is anti-competitive.
The regulator will instead hold a briefing process to inform all stakeholders as to appropriate pricing behaviour.
“The Authority has no intention of probing Vodacom’s recently introduced calling plan,” ICASA spokesperson Paseka Maleka confirmed to HumanIPO.
“Instead, the Authority intends to brief all stakeholders on its plans regarding the cost to communicate in South Africa in due course.”
After it announced today it will be conducting an urgent market review to determine whether mobile termination rates (MTRs) should be further lowered following the cut to take place on March 1 in order to improve competitiveness in the market, reports had emerged that ICASA would in particular be targeting Vodacom’s most recent pricing plan.
ICASA’s comments today had been interpreted by some to indicate larger operators would be probed due to allegations of marginalising small operators, by cutting prices to lower than the true cost of calls.
“High termination rates prevent small and new entrants from being able to effectively compete and allow larger players to offer on-net voice prices that are lower than off-net voice prices a smaller player may charge its customers. This may represent margin squeeze and predatory pricing,” ICASA said.
“The Authority is concerned that the pricing of an on-net voice call may be below the termination rate, an indication that operators are pricing on-net calls at below the true cost of a call, or that the current termination rates are still considerably too high.”
