Neotel Cuts Call Prices

Telecommunications provider Neotel has reduced its call prices to cellular phones, which it said on Friday was thanks to Independent Communications Authority of South Africa’s (Icasa’s) ruling to lower interconnection rates.

Neotel noted that as a result of Icasa regulations published last year, there were now upper limits to the termination rates that network operators may charge each other for calls.

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“Neotel has kept its promise, and has passed on cost savings to its customers, by reducing the price of calls to most mobile phones,” said the company.

From March 1, calls from a Neotel line to MTN and Vodacom phones would cost 95c (plus value-added tax, or Vat) during peak hours, and 85c (plus Vat) during off-peak hours. Calls to Cell C and 8ta would cost R1,20 (plus Vat) during peak hours, and 96c (plus Vat) during off-peak hours.

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Neotel said that it offered substantial savings to businesses and consumers for calls to landlines or mobile phones. “At standard rates, it is still cheaper to call a Telkom line from a Neotel phone than from a Telkom phone, and all calls between Neotel subscribers countrywide are free after hours. And now, Neotel is able to offer the best ever prices for calls to mobile phones as well,” said the company.

Lower interconnection rates was one of the solutions that was often punted as vital to lowering the cost of telecoms in South Africa.

Increased capacity through more undersea fibre-optic cables was also said to have decreased the cost of broadband in the country, and Neotel chief technology officer Dr Angus Hay recently noted that the wholesale price of broadband in South Africa has dropped by 80% in recent years.

Neotel was also collaborating with other telecoms operators on the construction of a national fibre-optic backbone, which would enable the capacity from the coastal landings of the undersea cables, to be brought inland, where it was sorely needed.

While international capacity is no longer a bottleneck in the system, national access has been highlighted as the next major bottleneck to be addressed. Private players in the telecoms market were lobbying for the ‘unbundling of the local loop’.

This would give competitors access to Telkom’s significant copper network in South Africa, which has some five-million connections.

According to the Electronic Communications Act, the local loop is considered an “essential facility”, however, in many markets, incumbent operators like Telkom have used their control of this infrastructure to charge high prices for access.

A deadline of November 2011, has been set for unbundling the local loop in South Africa.

Icasa has said that local loop unbundling is a still a priority, regardless of the fact that technologies are evolving and some question whether operators would even want to access the copper network, when fibre-optic cables are the preferred technology.

 

Source : http://www.engineeringnews.co.za/article/neotel-cuts-call-prices-to-mobile-phones-2011-02-25/rep_id:4136

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