South Africa's telecoms regulator, ICASA has concluded their study into handset subsidies in the country, and decided not to ban subsidies on the sales of handsets with contracts. The enquiry was motivated by consumer interest mainly in respect to the effective implementation of mobile number portability and the 24 month contracts that customers sign with service providers. Amongst others, concerns were that Mobile Operators and Service Providers offer handset subsidies to contract customers under the pretext of a "free" phone.
Currently there are no real choices to consumers with regard to price and contract periods less than 24 months for contract subscribers.
The handset subsidy ties a consumer to a period of 24 months, at month 21 a consumer has to give 3 months notice for cancellation of the contract. Alternatively consumers are allowed to upgrade the handset for a further period of 24 months within 18 months of concluding the contract.
Public comment was soliticited on the enquiry through a Discussion Document twelve submissions were received in response to the discussion document by the closing date 5 July 2005. Public hearings were held in August 2005.
Amongst the recommendations from the regulator, one stands out. The regulator is calling for more choice for contract periods, so the era of the 2 year contract may soon end."
Posted to the site on 27th February 2006
Posted to: www.cellular-news.com/story/16287.php