'MTN, Vodacom want unregulated market'
Icasa said both companies deliberately created a hostile environment for smaller players.
JOHANNESBURG - The Independent Communications Authority of South Africa (Icasa) on Wednesday dismissed accusations by Vodacom and MTN that new Mobile Termination Rates (MTR) are irrational and miscalculated.
The regulator is making submissions to the South Gauteng High Court in Johannesburg.
MTN and Vodacom approached the courts in a bid to stop Icasa from implementing the new rates.
Termination rates are the fees companies charge each other to connect calls between networks.
Icasa claims the two companies simply want an unregulated market.
The regulator further argued the MTR reductions will level the playing field and allow for fair competition in the market.
Icasa's legal representative David Unterhalter told the court the two mobile giants have enjoyed handsome financial gain over the years from unregulated MTRs.
He gave a brief history of how MTN and Vodacom made huge profits in the past by dominating the industry.
Unterhalter said the companies increased MTRs in 2001, just as Cell C joined the market.
They therefore deliberately created a hostile environment for the smaller players.
Under the regulations, bigger companies like MTN and Vodacom get 20c per minute for termination rates while smaller firms will receive 44c per minute.
Both MTN and Vodacom argue Cell C stands to gain the most from new fees.