NCA poised to set price ceiling for telecommunication services

NCA poised to set price ceiling for telecommunication services

The Ministry of Communication has directed the National Communications Authority (NCA) to set a price ceiling on all telecommunications services to promote competition and address growing disparities in market and revenue shares in the sector.

The floor pricing of services, which includes voice calls, data, short messaging service (SMS), Mobile Money, among others, was to ensure a level-playing field for all network operators within the telecommunications industry.

A statement signed and issued by the Minister of Communications, Ursula Owusu-Ekuful in Accra yesterday, said, the move forms part of other specific measures to be implemented by the NCA to promote proper and healthy competition among telecommunications players, secure a much better pricing policy for the consumers and facilitate a sound regulatory regime.

Among the measures are asymmetrical interconnect rate in favour of the disadvantaged operators, review and approve all pricing by MTN network, which is considered the Significant Market Power (SMP), as required by law and require of the company not to have differential prices for on-net and off-net transactions.

Additionally, the NCA was to ensure various operator vendors were not subject to exclusionary pricing or behaviour, ensure that SMP’s access to information does not disadvantage any value added service of non-SMP operators and require operators to present implementation plans on National Roaming Services within the next 30 days for execution on or before the next 90 days.

Among other benefits, the implementation of the policy, would maximise consumers’ welfare, stimulate the activities of third party vendors such as Value Added Service providers and give them a choice to work with non-SMP operators and prevent the dominant operator from using predatory pricing to eliminate competition.

The statement noted that it would also create a catalyst for passive infrastructure sharing within the industry especially for national roaming services and increase service choice for consumers within areas where SMP is present and would not be permitted to charge a high price to call, SMS, or transfer money to other services, while keeping its own prices low. 

The statement noted that the policy directive was due to growing market imbalance and creation of a near monopoly in the country’s telecom sector adding that the imbalance potentially exposes the country to the dictates of the dominant operator and negatively impacts on competition and choice for the consumer as well as investments within the sector.

Referring to statistics which indicate that MTN has almost 75 per cent of telecommunications market share, the statement said although it showed growth within the telecommunications and financial sectors, it also shows an uncompetitive and unprofitable environment for less dominant players in those industries.

It said the measures were in line with the NCA’s functions and duties outlined in the National Communications Authority Act 769 of 2008, Section 3e, which requires the Authority to ensure fair competition amongst licencees, operators of communications networks and service providers of public communications

It said the government acknowledges the investments MTN has made in their operations over the years however, its growing dominance has impacted negatively on competition and consumer choice, necessitating corrective action.

The statement called on all network operators to collaborate with the NCA to ensure the measures were implemented successfully.


Google+ Linkedin

Leave a Reply

Your email address will not be published. Required fields are marked *