CAPE TOWN: Vodacom has suffered a R2bn hit in service revenues in South Africa largely owing to major cuts in local mobile termination rates (MTRs). MTRs are the rates telecommunication operators charge each other for terminating calls on their networks.
The Independent Communications Authority of South Africa (Icasa) has adjusted these rates to ensure that smaller operators such as Cell C and Telkom Mobile earn more from MTR than bigger players Vodacom and MTN [JSE:MTN]. Vodacom, which is South Africa’s biggest mobile network, reported on Monday in its annual results for the period ending March 31 2015 that its SA service revenues fell 2.7% to R47.032bn.
Vodacom largely attributes this fall to a 50% cut in MTRs in April 2014. The company explained that excluding the MTR impact, its service revenue grew 1.5% and returned to growth in its fourth quarter.
