SOUTH AFRICA TELECOMS 'AMONG WORLD'S MOST COSTLY', SAYS NEW SURVEY

Telecoms

Charges for both fixed-line and cellphone calls in SA continue to hamper efforts by South African companies to compete in the world's shows.

The survey, conducted by a US-based telecommunications and energy cost control consulting group NUS Consulting, says telecommunications charges in SA remain high despite competition in the cellphone sector and notwithstanding Telkom's reduced charges for national and local calls last year.

"According to our latest annual survey of 14 of the world's most important telecommunica tions markets, our tariffs for national long-distance calls and cellphones are still the highest of the major world economies with which we do business," said Stephan Dolk of NUS Consulting in SA.

According to the survey, a three-minute national call (a call made over a distance of 320km) using a fixed-line phone costs $0,34 in SA while a similar call costs $0,08 in Sweden, the lowest call rate among the 14 countries surveyed. Similarly, a three- minute national call on a cell phone costs $0,74 in SA while a similar call costs $0,16 in the US.

Dolk said SA's fixed-line charges for local and international calls were the second-highest after those charged by operators in Belgium and the US respectively. He said fixed-line operator Telkom should be applauded for reducing its prices despite the ongoing continuing lack of competition.

"However, the decreases simply do not match up to the widespread price reductions made by telecommunications operators in many other countries, where charges for many call categories have dropped sharply as a result of competition," said Dolk.

Telkom said its prices were competitive. Company spokeswoman Lulu Letlape said call charges were used to subsidise the cost of the access network. "This is a deliberate strategy to ensure that the barrier to entry is kept as low as possible. We are of the opinion, therefore, that in terms of the basket of products, another operator would find it difficult to be cheaper."

Telkom had also said previously that its international tariffs were not determined unilaterally but were a product of agreements between it and other operators on whose network it connects for international traffic.

The NUS said Telkom had "alienated" its customers through its high telephone and internet prices and that the second national operator could capitalise on this "general feeling of anger and frustration" to cannibalise some of Telkom's market share.

Telkom said last year that it could lose 10%-15% of its market share to the second operator, which The second operator is expected to be launched in June.

The US, which has the lowest cellphone tariffs among the countries surveyed, is the most expensive country in as far as international fixed-line rates are concerned.

The study shows a three-minute international call from New York to London costs $0,78 while a similar call from London to New York costs $0,13.

Also surveyed were Spain, Germany, Canada, France, Denmark, Italy, The Netherlands, Australia and Finland.

Business Day