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Cran Reduces Mobile And Fixed Termination Rates

Staff Writer

The Communications Regulatory Authority of Namibia (CRAN) on Friday announced that it will be reducing termination rates for Namibia from 1 October 2022.

Termination rates are interconnection payments/charges made between operators to compensate one another for traffic exchanged between their networks.

“The reduced mobile termination rates will be N$ 0.05c/minute (reduced from N$ 0.10c/min), fixed termination rate N$ 0.05c/minute (reduced from N$ 0.10c/minute) and SMS remains at N$ 0.01c per SMS,” said Emilia Nghikembua, Cran’s chief executive officer.

Last year, Cran conducted a study to determine the impact of lowering termination rates on the industry.

Nghikembua said the decision is important as one of the largest cost components for operators providing voice services is that of interconnection, and this reduction shall therefore enable more competition in the sector.

She explained that Namibia has approximately 2.9 million subscribers, of which 90 per cent are Mobile Telecommunications Limited (MTC) subscribers and the other 10 per cent is made up jointly of subscribers from Telecom Namibia, Paratus Telecommunications (Pty) Ltd, and MTN Business Namibia (Pty).

“This means that the MTC network carries most of the outgoing traffic calls and SMS volumes. This results in “other operators” paying more to MTC for calls made to the MTC network, in comparison to calls made from MTC to other networks,” she said.

In this vein, she said reducing the termination rate will assist other operators to reduce their operational costs and compete more effectively.

“For now, consumers will not directly benefit from this reduction in terms of paying less for voice calls but may indirectly benefit from increased competition in the industry which will increase the variety of services and products.”

In addition Cran is investigating other possibilities to reduce voice call rates, to give consumers relief over the medium term and a decision will be communicated in due course.

“Cran’s focus is to reform the regulatory landscape to yield tangible results for consumers in the form of affordable prices and increased product and service choice, while ensuring a competitive landscape for our licensees to thrive. The reduction in termination rates, is therefore one of several interventions that we will be implementing to realise this commitment,” Nghikembua conluded.

Staff Writer

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