Western Cape Business News

Send  Share  RSS  Twitter  07 Sep 2009

COMMUNICATION: Reduced Telecoms Cost Welcomed


Recent Western Cape Business News

THE Cape Chamber of Commerce has welcomed the commitment of Communications Minister, Mr Siphiwe Nyanda, to reduce telecommunications costs in South Africa.

Our phone and broadband tariffs are among the highest in the world and business is impatient to see some real action to lower these costs and make us more competitive in this age of globalisation,” said Mr Jeremy Wiley, President of the Chamber.

He believed the Minister was right to target the high interconnection fees charged when phone calls made on one network were connected to a second network. “At present the charge is R1.25c a minute during business hours despite the fact that experts estimated that 25 cents a minute would be a fair charge and one that would be in line with tariffs in other countries.”

Mr Wiley said a saving of one rand a minute on every call that crossed cell phone and landline networks would produce a huge saving for business and make a big difference to monthly telephone accounts.

As an example he pointed out that 80 percent of the cost of a phone call from a landline to a cell phone went to the cell phone company in the form of interconnection charges. Stripping away the excess charges would also result in more competition between networks and encourage greater use of cell phones to improve communication and make business more efficient.

The Chamber had been campaigning for years for lower telecommunications costs but the high interconnection fees were one of the main reasons why business and consumers had not benefitted from competition between three cell phone and two landline networks. “The Interconnection fees have been used to keep prices high and to create an entry barrier for new players. It is high time that the Government stepped in to level the playing fields and bring relief to business and consumers,” Mr Wiley said.


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