October 9, 2013 / 9:32 AM / in 4 years

UPDATE 2-South Africa's Cell C accuses mobile rivals of unfair pricing

* Cell C calls MTN, Vodacom pricing “discriminatory”

* MTN dismisses complaint as “spurious” (Adds MTN, Vodacom reaction)

By Tiisetso Motsoeneng

JOHANNESBURG, Oct 9 (Reuters) - South Africa’s third-largest mobile operator Cell C on Wednesday lodged an antitrust complaint against MTN Group and Vodacom, charging its bigger rivals with “discriminatory pricing”.

The was the latest attack by Cell C’s Chief Executive Alan Knott-Craig, himself a former Vodacom CEO, on the dominance of his bigger rivals.

Days earlier, South Africa’s telecoms regulator said it planned to cut the fees that mobile operators charge each other to use their network, a move expected to benefit Cell C.

Privately held Cell C said it had complained to South Africa’s competition watchdog over the prices MTN and Vodacom charge their own customers for calling users of other networks.

MTN and Vodacom offer discounts when customers call subscribers on the same network, but charge a premium for calls to other networks, Knott-Craig said in a statement.

“This amounts to discriminatory pricing and is without a doubt anti-competitive when adopted by dominant operators,” he said.

“Cell C is apparently arguing for an increase in the price that Vodacom customers pay to call other Vodacom customers,” said Richard Boorman, a spokesman for Vodacom, a unit of Britain’s Vodafone Plc

“It’s hard to argue that increasing prices would be a benefit to consumers,” he said.

MTN dismissed the complaint as “spurious” and said there was no anti-competitive conduct as alleged by Cell C.

“We see this as another desperate attempt to cry for further subsidies for a failing business,” said Zunaid Bulbulia, the chief executive of MTN’s South African unit.

It was not immediately clear what action the Pretoria-based Competition Commission would take.

Cell C cited a case in France where the regulator fined the two biggest mobile groups a total of 183 million euros ($248.82 million) for pricing plans that favoured calls within the same network.

South Africa’s competition authorities have a history of handing down stiff penalties for anti-competitive practices.

In June, they fined several construction companies 1.46 billion rand ($147 million) for bid rigging on projects worth an estimated 47 billion rand, including stadiums and other support structures for the 2010 soccer World. ($1=9.9410 South African rand) ($1=0.7355 euros) (Editing by David Dolan and David Cowell)

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