Last week, the Communications Authority of Kenya (CA) announced that it had revised call termination rates downwards from KES 0.99 to KES 0.12 per minute.
The new rates, according to the CA, will go live on January 1, 2022.
When that happens, Kenyans will pay less money when making calls.
However, the development has been disputed by leading operator Safaricom, which says that the reduction was not arrived at procedurally. To this end, Safaricom wants the changes declared invalid.
Safaricom’s case has since been presented to the Communications and Multimedia Appeals Tribunal.
Part of the carrier’s argument is that the CA failed to follow its own procedures when revising the termination rates. For instance, Safaricom says that the CA ignored public participation input when adjusting the rates.
Safaricom’s complaint, which has been presented as urgent seeks to see the case heard before the new rates kick in over the weekend.
The case is important to Safaricom because it secures substantial revenue from termination fees. For example, it receives about KES 300 million per month from Airtel Kenya under the existing rates. That amount can go lower should the new rates be adopted.
Termination rates are adjusted from time to time by the operator. For context, when you call someone who is on a different network, that operator charges your telco for connecting and ‘terminating’ the call.
Put differently, termination rates are basically wholesale tariffs levied by the telco of a user receiving a phone call to the operator of the caller’s network.
As part of the cost of a call between customers of different carriers, termination rates are part of your phone bill and are paid by consumers.
“The revised interconnection rate is projected to have a positive outcome for both the consumers and operators. At the retail level, consumers will now enjoy access to a variety of affordable services across networks, and at a wholesale level, operators will have more price flexibility when developing innovative and affordable products,” said CA when announcing the new rates.
