Icasa narrows focus in drive to bring down data costs
SA will soon know which markets the watchdog will focus on in its attempt to rein in the cost of communicating
SA will know in June which markets will be the focus of watchdog Icasa’s bid to bring down the cost of communicating.
The Independent Communications Authority of SA (Icasa) says the findings document that will list which markets it will focus on, will be published in June.
Icasa is pulling out all the stops to reduce the cost of communicating, saying it is only through legislative means that it can ensure reasonable pricing and market structure in the sector.
Despite various interventions in recent years, the cost of communicating remains high.
In April, Icasa published its final End-User and Subscriber Service Charter Regulations. One of the measures contained in the regulations is that network operators must allow subscribers to roll over their unused data.
In terms of the regulations, all licensees will be required to send usage depletion notifications to consumers when their usage is at 50%, 80% and 100% depletion levels.
The regulator said this would enable consumers to monitor their usage and control spending on communication services.
Operators will no longer be allowed to charge consumers out-of-bundle rates for data without the consumers’ specific prior consent.
This, according to Icasa, will ensure consumers are not defaulted to out-of-bundle data charges, which are significantly higher than in-bundle charges.
Icasa said the recent publication of the End-User and Subscriber Service Charter Regulations was the start of a three-pronged process to address the costs of communicating, particularly for data services.
"When the first draft of the regulations was published in August 2017, Icasa made it explicitly clear to all stakeholders that these regulations do not deal with the regulation of data prices.
"These are primarily consumer protection regulations aimed at promoting transparency and prohibiting unfair business rules in the provision of communication services," the regulator said.
Pragmatically, there were two key processes that had to unfold before prices could come down, Icasa said.
"The first of these processes is already under way. It is a process in terms of which Icasa will identify the relevant ‘priority’ markets that are prone to uncompetitive behaviour.
"The discussion document on priority markets was published on February 16 2018 and the consultation process is at an advanced stage.
"This process will be concluded by June 2018 with the publication of a findings document that will list the markets that Icasa will focus on to address the high cost of communication."
The second is a market review (or reviews) in the specific markets identified in terms of the findings document. This review is expected to start in the second half of the financial year.
"Without pre-empting the process, it goes without saying that the market/s to be prioritised for review will be those deemed critical in the broadband/data services value chain.
"Through this process, Icasa will assess the competitiveness of the market, determine whether there is any operator with significant market power (ie, whether there is any operator that is dominant in the market) and impose appropriate pro-competitive remedies on such operators (which may include price controls)."
Jeremy Lang, regional general manager at Business Partners Limited, said it was imperative to reduce the cost of data in SA to contribute to minimising the cost of running small and medium enterprises (SMEs), and to improve their ability to grow.
Lang said internet connectivity had become an indispensable business tool for most entrepreneurs and business owners.
"However, the high cost of data in the country is severely impacting the profitability and productivity of many SMEs and startup businesses and can be a notable prohibitor when it comes to accelerating SME growth."