Feeling swamped with hundreds of cellphone packages, free phones and other enticing gifts to choose from? If South Africa’s communications regulator gets its way, consumers will soon have another choice: the duration of their contract.
But that’s not all; the Independent Communications Authority of South Africa (Icasa) will also be forcing operators to make their cellphone packages completely transparent, so consumers know how much that ‘free phone†is actually costing them.
Cellphone operators were locked in a scrum this week at Icasa’s public hearings on regulations governing the hidden costs and subsidies of cellphone handsets, which were published in June last year. A number of operators were trying to prevent the imposition of suggested new regulations.
The hearings are the final step in a process that began almost two years ago. Once they have concluded, Icasa will be able to finalise the regulations so they can be promulgated.
The draft regulations also require operators to explain fully to their customers the consequences of a contract breach and prohibit them from any form of Sim-locking or handset locking.
Mobile operators and service providers alike argue that one-month and 12-month contracts, as well as ‘bring your own phone†deals, have been on offer for a while and that uptake for these contracts is slow, with most consumers preferring to get a new handset with their deal.
Nashua Mobile’s financial director, John Ellis, told the hearings the company had experienced limited uptake on anything other than the 24-month contracts, while Vodacom’s managing director, Shameel Joosub, argued that the market should dictate contract lengths.
Icasa chairperson Paris Mashile, who chaired the hearings, was visibly frustrated with the cellphone operators’ claims that there was no need for regulation. He said the companies operated as a cartel and bemoaned the fact that there seemed to be very little competition between operators in South Africa.
However, Virgin Mobile’s CEO Peter Boyd, called on Icasa to force operators to be more transparent in their dealings with customers.