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"The ACDP congratulates the Minister on successfully facilitating this agreement to reduce mobile termination rates. The present cell phone industry leaders appeared unlikely to reduce interconnect rates unless there was significant regulatory or political pressure...we are impressed!

The Minister told the National Assembly that "High mobile termination rates are impeding any possibility of new entrants into the market.

The current mobile termination rates are as follows; peak: R1.25 and off-peak: R0.77. Therefore the blended rate is R1.03. The agreed reduced termination rate has been reduced to R0.77 cents. The overall total cost reduction on peak rates is 36 cents".
The Department of Communications study to benchmark South African communication costs against our "peer countries" comparing us to Brazil, Chile, Korea, India and Malaysia, found that our country has exceptionally high telecommunications prices relative to our peer group countries and that we have the "least competitive market".
Interconnect fees, for example, were designed to help the mobile operators build their networks when they launched, and these are not necessary now. <#_ftn1> Industry commentators say the evidence is overwhelming that there was little justification for pushing the interconnect fee up in the first place and estimate that a fee of 10c to 25c would be more than adequate to cover their interconnect costs now.

We look forward to your on-going success in the interests of the people of South Africa and future development".