Vodacom Tanzania takes TCRA to the Fair Competition Tribunal over interconnection rates

Telecoms

Vodacom Tanzania has taken the regulator to the Fair Competition Tribunal over its introduction of a new interconnection framework in January 2008. The framework would have lowered the level of income from interconnection enjoyed by its four mobile operators.

Consumers will now have to continue an anxious wait to see the cost-saving benefits of a new regime, since key operators face profitability declines with the new rates.

This is the second time TCRA has tried to decrease interconnection rates.

The communications regulator suggested a decrease of interconnection rates to a maximum of 7.6 US cents per minute from the current rate of more than 8 cents per minute. The new rates are set at 7.65 cents for two years, from January 2008 to December 2009, and then coming down to 7.32 cents for two years, and a further fall to 7.16 cents beginning January 2012.

Despite a large and very expensive consultant’s report from Analysys (UK) Limited (which also did the Kenyan interconnection study), Vodacom Tanzania is maintaining that the TCRA alteration of interconnection charges was reached without sufficient evidence of its justification and that the operators were not themselves allowed to be heard during the inquiry.

A determination panel in December found that the larger mobile operators like Vodacom and Celtel service providers were against the new price regime, whilst smaller companies like Benson Informatics, MIC (T) Ltd, Sixtelecoms Ltd, Zantel and TTCL were in favour of the proposed rates.

Prof. John Nkoma, the TCRA director general said that the move targets making mobile telephone services more easily accessible to many people, particularly those living in rural areas. "The decrease in interconnection rates will automatically benefit the people, not only in urban centres, but also those who live in rural areas, who will get access to mobile telephone services more easily," he said.

The Citizen