3.1 Amendment to regulation 1
3.1.1 Submission Received
| 3.1.1.1 | Liquid Telecom queried the reasons for the deletion of definitions "Service activation" and "Service Activation Time" and stated that it believes that the definitions provide guidance for stakeholders in complying with regulation 9(5) of the second draft EUSSC Regulations. |
| 3.1.1.2 | Liquid Telecom indicated that references to "post-paid plans" and "hybrid plans" were not defined and may therefore be subject to interpretation.8 |
| 3.1.1.3 | Vodacom stated that there were additional items that required definitions such as "out-of-bundle", "allocated data", "session" and "disconnection". |
| 3.1.1.4 | WAPA suggested that the Authority include the definitions for "prepaid" and "post-paid" so licensees can be clear on which subscribers fit into which category. |
| 3.1.1.5 | Cell C did not agree with the definition of "data bundle" and suggested that the definition refers to "bytes" and "connectivity for purposes of the internet." |
| 3.1.2 | The Authority’s Decision |
| 3.1.2.1 | The Authority is of the view that the definitions for "Service activation" and "Service Activation Time" should not be included in the Regulations as these terms were not used in the body of the Regulations. |
| 3.1.2.2 | The Authority included a definition for "post-paid plan" as suggested by WAPA as well as a definition for "hybrid plan" as suggested by Liquid Telecom. |
| 3.1.2.3 | The definition of "prepaid" was not included in the Regulations as it was not used in the body of the final Regulations. |
| 3.2 | Amendment to regulation 5 |
3.2.1 Submission Received
MWEB stated that it believed that fair usage policies should only be included in promotional material insofar as the policy of the promotion differs from the usual policy.
| 3.2.2 | The Authority’s Decision |
The Authority is of the view that the inclusion of fair usage policies in respect of promotions will empower end-users to make informed decisions, and as such are to be included at all times.
3.3 Amendment to regulation 8
| 3.3.1 | Submissions Received |
| 3.3.1.1 | ISPA recommended that regulation 8 be amended due to the deletion of sub-regulation 7(a). |
| 3.3.1.2 | Liquid Telecom was concerned that the deletion of regulation 8(7)(b) would have harmful consequences to consumers. |
| 3.3.2 | The Authority’s decision |
The Authority is of the view that these provisions have been catered for under the Code of Conduct for Premium Rated Services Regulations and as such should not be included in the Regulations.
| 3.4 | Insertion of regulation 8A(1) |
3.4.1 Submissions Received
| 3.4.1.1 | Liquid Telecom indicated that the proposed usage notifications would only be applicable in the context of mobile services. Liquid Telecom further indicated that there are different platforms available for consumers to monitor their data usage and that it should be a consumer’s responsibility to monitor usage using these platforms. |
| 3.4.1.2 | MTN stated that the Authority did not specify whether or not the proposed amendment would apply to prepaid or post-paid end-users. Furthermore, MTN stated that the provision of voice and SMS usage notification intervals of 50%, 75%, 90% and 100% may be excessive and irritate end-users. MTN was of the view that the proposed usage notification should be left to the discretion of licensees. |
| 3.4.1.3 | Vodacom submitted that the content of the notification and the "percentage depletion" notification ought not to be prescribed. Vodacom was of the view that end-users will not benefit from the proposed "percentage depletion" notification and that it will likely confuse rather than to assist end-users. Vodacom proposed a notification which would record the bundle units remaining (i.e. voice or SMS), for which it believes it would enable end-users to manage and control their usage and to proactively plan for the purchase of additional bundles or units if they so require. Vodacom suggested that a maximum of two notifications should be given to end-users before they have reached the 90% threshold of usage for services as end-users will be given sufficient time to respond after such notifications. However, Vodacom pointed out that a number of devices that use voice and SMS services (specifically for M2M applications) do not have the facility to view such notifications. 9 |
| 3.4.1.4 | Cell C stated that it was not clear on why voice and SMS services were included in the Regulations. Cell C was of the view that the Regulations should deal with data services, not voice and SMS. |
| 3.4.1.5 | Telkom stated that it did not support the proposed percentage depletion usage notifications with respect to voice and SMS usage. Telkom proposed that the provision be adjusted to allow for actual value of data remaining instead of percentages. |
| 3.4.1.6 | Mr Mark Lister stated that usage notifications should be provided by licensees at no charge to end-users. Mr Lister further stated that the timing of the proposed usage notifications was not guaranteed and the end-user might not be able to read the messages and react timeously.10 |
3.4.2 The Authority’s Decision
| 3.4.2.1 | The Authority is of the view that the said notifications are necessary to empower end-users to monitor usage and limit spend to avoid or minimise bill shock as a result of out-of-bundle charges. |
| 3.4.2.2 | The Authority, however, agrees with the licensees’ views that percentage depletion usage notifications, rather than the relevant unit of measure, will more than likely confuse rather than assist end-users. |
| 3.4.2.3 | The Authority has modified regulation 8A(1) accordingly. Licensees are therefore required to send notifications to end-users which records the voice and SMS bundle units remaining instead of percentage of units remaining. |
| 3.4.2.4 | The Authority has decided to reduce the usage notification percentage triggers to a minimum11 of three notifications (i.e. 50%, 80% and 100% depletion) to minimise or avoid the risk of too many notifications, which could potentially confuse customers or result in customers ignoring them. |
| 3.5 | Insertion of regulation 8A(2) |
3.5.1 Submissions Received
| 3.5.1.1 | MTN was of the view that this regulation was not necessary as prepaid, hybrid or post-paid users were able to purchase or load additional airtime or SMS bundles. |
| 3.5.1.2 | Vodacom was of the view that this regulation should make it clear that the "option to buy" was not to be provided only upon depletion of the services but at any time, so as to avoid disruptions of service. |
| 3.5.1.3 | Telkom submitted that it supported this provision as it offered voice and SMS bundles to its subscribers through its self-service menu, its online portal and through the USSD option. |
| 3.5.1.4 | Cell C stated that its post-paid subscribers are already offered additional services upon depletion of allocated voice and SMS services. |
3.5.2 The Authority’s Decision
The Authority is of the view that this option is necessary as some of the operators do not provide post-paid users with an option to buy additional voice or SMS services, which may result in post-paid users paying out-of-bundle rates.
3.6 Insertion of regulation 8A(3)
3.6.1 Submissions Received
| 3.6.1.1 | MTN indicated this provision was too prescriptive and did not consider interventions put in place by licensees (i.e. usage limit) to empower end-users to control and limit their spend.12 MTN further indicated that by providing post-paid users with an option to be disconnected from accessing relevant services upon depletion of voice and or SMS bundles, the Authority was interfering with the design of its post-paid/hybrid products and is not authorised in terms of section 69(5) of the ECA.13 |
| 3.6.1.2 | Vodacom submitted that this regulation was unclear as to what was the default position when the end-user fails to choose from the options provided. Vodacom stated that licensees were obliged to continue providing the services and applicable out-of-bundle rates would apply. Vodacom stated that it was unclear as to when these notifications should be sent out to the end-user (i.e. at the time of or after the depletion of the allocated services). |
| 3.6.1.3 | Vodacom indicated that this regulation was ultra vires as it amounted to the prescription of the basic product and service offering and associated price modelling, by effectively excluding a particular product offering, which is beyond what section 69 of the ECA empowers.14 |
| 3.6.1.4 | Vodacom stated that unlike data services, voice and SMS services are used intentionally by end-users and therefore, there was unlikely to be instances of bill shock as suggested by the Authority.15 |
| 3.6.1.5 | Vodacom stated it was technically unfeasible to provide an option to disconnect machine to machine (M2M) end-users, other than at the time of contracting, as there was no direct engagement with these users and M2M devices were programmed to ignore SMSs from Mobile Station International Subscriber Directory Number.16 |
| 3.6.1.6 | Vodacom further stated that post-paid and hybrid end-users can buy additional voice and/or SMS services at any time (prior to and upon depletion of the allocation) and can elect to be disconnected when certain thresholds were reached using service specific account lock facility.17 |
| 3.6.1.7 | Cell C was of the view that this provision would increase compliance and administrative costs without any concomitant benefit to the public.18 Cell C stated that this regulation did not make sense in the context of commercial transactions in the event that the end-user chooses the right package for their level of usage and their budget.19 |
| 3.6.1.8 | Telkom supported this provision as it offered a unique spend limit functionality for management and control of out-of-bundle spend.20 |
3.6.2 The Authority’s Decision
The Authority is of the view that this provision is necessary to protect post-paid/hybrid users against the current practice of defaulting them to out-of-bundle charges upon depletion of their monthly allocation.
3.7 Insertion of regulation 8B(1)(a)
3.7.1 Submissions Received
| 3.7.1.1 | MTN indicated that this provision was not necessary as it sends usage notifications to end-users and cautioned the Authority against the prescription of depletion intervals. MTN was of the view that the proposed notifications are excessive and may result in poor customer experience.21 In addition, MTN stated it had included proactive notifications by notifying end-users when they have reached 50% and then 90% of their data bundles to assist end-users to manage and monitor their spend.22 |
| 3.7.1.2 | Vodacom submitted that the content of the notification and the "percentage depletion" notification ought not to be prescribed. Vodacom was of the view that end-users will not benefit from the proposed "percentage depletion" notification and that it will likely confuse rather than to assist end-users. Vodacom proposed a notification which records the bundle units remaining (i.e. data), which it was of the view that would enable end-users to manage and control their usage and to proactively plan for the purchase of additional bundles or units if they so require. |
| 3.7.1.3 | Vodacom suggested that a maximum of two notifications be sent to end-users before they reach the 90% threshold of usage for services as end-users will be given sufficient time to respond after such notifications.23 However, Vodacom pointed out that a number of devices that use data services (e.g. M2M, dongles, routers, tablets, etc.) do not have the facility to view such notifications.24 |
| 3.7.1.4 | Cell C stated that it already provides notifications that bundles were becoming and have been depleted. Cell C stated that the proposed four increments of 50%, 75%, 90% and 100% were excessive and was of the view that it would irritate end-users, especially if the bundle was small.25 |
| 3.7.1.5 | Crystal Web Mobile and LEASP stated that the implementation of regulation 8B will require that fixed line Internet Service Providers inform customers through SMS of their data usage, with the transmission costs being borne by the ISP, operate as a USSD and not offer capped products. |
| 3.7.1.6 | Telkom supported and recommended usage notifications based on the fixed absolute methodology. Currently, Telkom mobile subscribers are sent SMS notifications when they have 500MB, 100MB, 10MB and 0MB data bundles remaining on their data plans. Telkom stated that it will be difficult to follow the Authority’s proposed amendment as it will have to make adjustments to each product bundle they offer, consequently being very costly. |
3.7.2 The Authority’s Decision
| 3.7.2.1 | The Authority is of the view that the notifications are necessary to provide relevant timely information that will enable end-users to better monitor usage and limit spend to avoid or minimise bill shock as a result of high out-of-bundle charges. |
| 3.7.2.2 | The Authority, however, agrees with the licensees’ view that percentage depletion usage notifications, rather than the relevant unit of measure, will more than likely confuse rather than assist end-users. |
| 3.7.2.3 | The Authority has therefore modified regulation 8B(1)(a) accordingly. Licensees must send end-users notification which include the amount of the bundle remaining (and the applicable out-of-bundle rate per MB). |
| 3.7.2.4 | The Authority has decided to reduce the usage notification percentage triggers to a minimum26 of three notifications (i.e. 50%, 80% and 100% depletion) to minimise or avoid the risk of too many notifications, which could potentially confuse customers or result in customers ignoring them. |
3.8 Insertion of regulation 8B(1)(b)
| 3.8.1 | Submissions Received |
| 3.8.1.1 | MTN was of the view that this regulation was not necessary as end-users can choose from a wide variety of additional bundles.27 |
| 3.8.1.2 | Vodacom stated that, contrary to the industry practice, this regulation will preclude licensees from providing end-users with an option to buy additional bundles anytime prior to depletion of the allocated data28 and therefore, resulting in negative impact on end-users29. |
| 3.8.1.3 | Telkom agreed with this provision as it had sufficient measures in place for end-users to purchase additional data bundles.30 |
| 3.8.2 | The Authority’s Decision |
| 3.8.2.1 | The Authority is of the view that this provision is necessary as it is meant to empower end-users to avoid bill shock as a result of high out-of-bundle rates. |
| 3.8.2.2 | The Authority agrees with Vodacom’s submission to the extent that it amended the regulation to make it clear that the option to buy additional data bundle should be provided at any time (i.e. before and after depletion of a data bundle), to minimise service interruption. |
3.9 Insertion of regulation 8B(1)(c)
3.9.1 Submissions Received
| 3.9.1.1 | MTN submitted that this provision amounted to interference with consumer choice with regards to product selection or infringe upon the right of end-users to choose their products and services; and was not authorised in terms of section 69 of the ECA. MTN further stated that this provision was an indirect attempt by the Authority to regulate the price of data services provided to end-users.31 In addition, MTN stated that this provision failed to take into account measures it had put in place to ensure that end-users were able to control and limit their spend on data service, if necessary.32 |
| 3.9.1.2 | MWEB was of the view that this provision was not necessary as end-users were provided information in line with the CPA about the rules relating to out-of-bundle charges. MWEB further stated that licensees already provide end-users with monitoring tools and as such there was no need to request the end-user to opt in or opt out of out-of-bundle usage. 33 |
| 3.9.1.3 | Telkom submitted that it offered the option to not to default end-users to out-of-bundle charges as a standard on its data packages, with the exception of its FreeMe bundles which are aimed at providing subscribers with continuous connectivity.34 Telkom was of the view that the option not to default end-users automatically to out-of-bundle charges could lead to poor customer experience and limit end-user choice and should not be enforced through Regulations.35 |
| 3.9.2 | Amandla.mobi submitted that out-of-bundle pricing was not transparent and was unfair to low income customers. Amandla.mobi further stated that automatic transition from in-bundle to out-of-bundle pricing without a customer consent to opt-in to out of bundle usage, with out-of-bundle pricing of up to 50 times in-bundle pricing, was unfair and is exploitative to the poor.36 |
| 3.9.3 | Amandla.mobi recommended that the default position should not be out-of-bundle usage or licensees should not provide data service which may attract out-of-bundle charges.37 |
3.9.4 The Authority’s Decision
| 3.9.4.1 | The Authority is of the view that the provision requiring that there not be defaulting end-user to out-of-bundle usage when their data bundles are depleted will not interfere with consumer choice. |
| 3.9.4.2 | The Authority is of the view that it is empowered to impose this provision as it relates to the manner in which end-users are billed or charged for out-of-bundle usage, which is consistent with section 69(5)(d)38 and (f)39 of the ECA. |
| 3.9.4.3 | The Authority would like to emphasise its view that the current practice of defaulting end-users to out-of-bundle charges is unfair and exposes end-users, particularly the poor, to the risk of bill shock as a result of high out-of-bundle charges. |
| 3.9.4.4 | While the Authority recognises voluntary measures40 put in place by licensees to ensure that end-users control and limit their spend or minimise bill shock, the Authority is concerned that these usage limits and data depletion notifications are not provided in real-time41 to allow end-users to make an informed and timeous decision. In addition, the Authority is of the view that the usage depletion notifications are not effective as the notifications provided by licensees do not provide information on the applicable out-of-bundle rate. |
3.10 Insertion of regulation 8B(1)(d)
3.10.1 Submissions Received
| 3.10.1.1 | ISPA42, WAPA43 and Liquid Telecom44 proposed that this provision should be amended to include out of bundle as follows: "provided an option through SMS, push notification, USSD or any other applicable means to opt-in or opt-out of out of bundle usage per session." |
| 3.10.1.2 | Liquid Telecom submitted that it was technically unfeasible to provide opt-in or opt-out per session using non-mobile data services/technologies. In addition, Liquid Telecom stated that consumers have a joint responsibility to monitor their usage and therefore, licensees should not be held solely liable for the irresponsible behaviours of some customers.45 |
| 3.10.1.3 | MTN was of the view that by the Authority prescribing the default position with regard to out-of-bundle charges will infringe upon the right of end-users to choose options that suit their needs.46 MTN stated that it was unclear what was meant by "per session".47 |
| 3.10.1.4 | MWEB stated that this provision was impractical, unfeasible and will result in poor customer experience as the experience will not be seamless.48 |
| 3.10.1.5 | Vodacom indicated that it was not always technically feasible to obtain consent from end-users (for example corporate APN users) to charge them various options including out of bundle rates.49 Vodacom also indicated that it is not technically feasible to provide an opt-out option for out of bundle usage on a per session or bundle basis but rather it can be done at a customer level.50 |
| 3.10.1.6 | Telkom stated that it supports this provision as it had sufficient measures to allow for opt-in or opt-out of out-of-bundle usage charges. |
| 3.10.1.7 | Cell C stated that the wording in this regulation which states that "option-or opt-out of data bundle usage per session" was vague and nonsensical, and that it contradicted regulation 2.51 In addition, Cell C indicated that it was not clear what "usage per session" means.52 |
| 3.10.1.8 | Amandla.mobi indicated that, each time a data bundle was about to be depleted, a licensee must send out an SMS offering an end-user the option to opt-in to out-of-bundle charges with information on the applicable out-of-bundle rate.53 Furthermore, Amandla.mobi indicated that in the absence of a reply from an end-user to opt-in to out-of-bundle charges, data service should be discontinued or cut-off and airtime usage for data service should not be allowed when an end-user had reached the data allocation limit or had depleted (or finished) the data bundle. |
| 3.10.2 | The Authority’s Decision |
| 3.10.2.1 | The Authority is of the view that this provision is necessary and will not undermine customers’ choice contrary to the views of some licensees. |
| 3.10.2.2 | The Authority is also of the view that this provision will ensure that end-users are fully aware of the consequences of exceeding their allocation of data to minimise higher than expected bills for data services. |
| 3.10.2.3 | The Authority included out of bundle as suggested by ISPA and Liquid Telecom. |
| 3.11 | Insertion of regulation 8B(2) |
3.11.1 Submissions Received
| 3.11.1.1 | MTN indicated that this provision was unnecessary, logically flawed and should be deleted as it had implemented measure to transparently communicate with end-users and to empower them to choose how to control their spend.54 |
| 3.11.1.2 | MTN55 and Cell C56 indicated that this provision contradicts regulation 8B(1)(d) to the extent that an end-user had opted out of out-of-bundle usage. |
| 3.11.1.3 | Telkom indicated that this provision was automatically available on all data plans with the exception of FreeMe57 plans. Telkom was of the view that this provision will limit customer choice and will stifles competition and innovation. |
| 3.11.1.4 | Liquid Telecom proposed that this provision be amended as follows: |
"end-user opts out of further data usage following data bundle depletion, a Licensee must not permit any out of bundle data usage by that end-user until such time as that end-user purchases a new data bundle or expressly consents to the charging of out bundle rates."58
| 3.11.1.5 | Vodacom indicated that it was not practical for M2M users such as tracking companies, retailers, utility companies, etc. to opt-out of out of bundle usage as M2M devices are unmanned or not manned on a full-time basis.59 Vodacom also indicated that M2M users prefer postpaid tariff plans which charge out-of-bundle rates by default due to low data usage of between 1Kb and 10MB per month.60 |
| 3.11.1.6 | Furthermore, Vodacom indicated that end-users who deplete their data bundle mid-session and do not opt-in for out-of-bundle charges will experience interrupted non-seamless data experience, which could result end-users paying to re-download the same content from the start.61 |
| 3.11.2 | The Authority’s Decision |
| 3.11.2.1 | After carefully considering submissions by licensees in this regard, the Authority is of the view that this provision should apply to prepaid and hybrid data users only. Unlike their post-paid counterparts62, prepaid and hybrid users face unique circumstances63 and appropriate accommodations are necessary to assist them to minimise or avoid bill shock. |
| 3.11.2.2 | The Authority is satisfied with bill shock protection measures implemented for post-paid users. Therefore, this provision does not apply to post-paid users. |
| 3.11.2.3 | The Authority agrees with Liquid Telecom's submission and has amended the regulation accordingly. |
| 3.11.2.4 | The Authority is of the view that this provision will not limit end-users choice and lead to frustration and a poor experience. For example, Telkom has been offering this option to the majority of its subscribers and the Authority has not received complaints from Telkom subscribers. The Authority, however, received complaints from MTN, Vodacom and Cell C subscribers about bill shock owing to high out-of-bundle rates.64 In this respect, the Authority found that MTN, Vodacom and Cell C's submission in this regard are misguided. |
| 3.11.2.5 | The Authority is of the view that the disconnection or reconnection option should not attract fees or charges as such fees would defeat the purpose of this regulation, which is meant to empower end-users to make an informed decision whether or not to pay high out-of-bundle charges. |
3.12 Insertion of regulation 8B(3)
3.12.1 Submissions Received
| 3.12.1.1 | ISPA65 and WAPA66 submitted that regulation 8B(3) can be read to mean that a licensee needs to merely provide an option of data bundles with a minimum validity period of 3 years along with its data bundles with a shorter expiry period. ISPA proposed that regulation 8B(3) should be amended to state that "A licensee must ensure that all prepaid data bundles are provided with a minimum expiry period of …"67 |
| 3.12.1.2 | ISPA stated that the Authority should be mindful of section 64 of the CPA as many licensees invoice data bundles monthly in advance, which blurs the lines between post-paid and prepaid.68 ISPA69 and WAPA70 further proposed that definitions of the terms pre-paid and post-paid be included in the final Regulations. |
| 3.12.1.3 | Liquid Telecom recommended that the Authority conduct a full regulatory impact assessment study as it was of the view that this regulation will impose a significant overhead on licensees.71 3.12.1.4. MTN was of the view that the proposed validity period of 3 years was tantamount to fixing the terms of the provision of data services and will stifle competition to the detriment of end-users.72 |
| 3.12.1.5 | MTN stated that the proposed expiry period of three years will result in an increase in unearned revenue liability on MTN’s balance sheet, which will impact of MTN’s key ratios. MTN stated that this impact will be exacerbated by the current growth in data consumption.73 MTN submitted that a regulatory impact assessment study was required to fully understand the impact of the proposed amendment.74 |
| 3.12.1.6 | MTN indicated that the Authority incorrectly equated the purchase of a prepaid data bundle with the purchase of a prepaid voucher as envisaged in section 63(2) and (3) of the CPA.75 MTN is of the view that section 63 ceases to apply to prepaid data bundles as section 63 required that an end-user be given a period of three (3) years within which to redeem a voucher and not a period of three (3) years to use the services (i.e. data bundles) that were made available pursuant to the purchase of a voucher.76 |
| 3.12.1.7 | MTN further stated that the Authority does not have the power to make pronouncements on the correct interpretation of the provisions in the CPA, particularly with respect to section 63, without any consideration of the views of the National Consumer Commission ("NCC"). MTN indicated that the NCC had not taken issue with MTN’s application and interpretation of section 63.77 |
| 3.12.1.8 | MTN indicated that the proposed validity period of three (3) years will counteract section 68 of the ECA, which enjoins the Authority to ensure efficient use and allocation of scarce numbering resource.78 |
| 3.12.1.9 | MWEB submitted that section 63 of the CPA does not apply to prepaid data as prepaid data was not the same as a prepaid certificate, credit or voucher. Furthermore, MWEB stated that the proposed validity period of three (3) years will make it impossible for licensees to project the expected usage on their network in order to manage it.79 |
| 3.12.1.10 | The Free Market Foundation ("FMFSA") submitted that this provision was ambiguous as it was not clear if licensees will be required to offer data bundles with minimum validity period of three (3) years in addition to the current data bundle offerings.80 Furthermore, FMFSA stated that this provision was ultra vires as it falls outside of matters contemplated in section 69(5) of the ECA.81 |
| 3.12.1.11 | FMFSA disagreed with the Authority’s interpretation of section 69(5)(f) of the ECA. FMFA is of the view that "any other matter of concern to end-users and subscribers" means "customer service" matters of concern to end-user and it did not bear a wider meaning as proposed by the Authority in the second draft EUSSC Regulations.82 |
| 3.12.1.12 | Vodacom submitted that the Authority did not have power to impose interventions in the ECA based on the Authority’s interpretation of the CPA.83 |
| 3.12.1.13 | Vodacom was of the view that the interpretation and application of the CPA did not lie within the remit of the Authority but that of the NCC.84 Vodacom was also of the view that the Authority can refer the matters of non-compliance with section 63 to the NCC who can refer the matter to the National Consumer Tribunal.85 |
| 3.12.1.14 | Notwithstanding the above, Vodacom indicated that the correct interpretation of section 63(2) of the CPA required a clear understanding of section 63(1). Vodacom stated that it was important to identify the device, what was sold by Vodacom, what was bought by an end-user and the point in time at which redemption occurs and what was made available to the consumer on redemption.86 |
| 3.12.1.15 | Vodacom stated that the Authority was not empowered by legislation to prescribe validity periods for data expiry, which will directly affect and regulate the price of data services87. Furthermore, Vodacom stated that regulation of prices did not fall within minimum standards as contemplated in section 69 of the Electronic Communications Act and also violated section 2(f)88 and (y)89 of the ECA |
| 3.12.1.16 | Vodacom was of the view that the prepaid vouchers sold by it comply with section 63 of the CPA as they are valid for thirty-eight (38) months from the date of issue.90 |
| 3.12.1.17 | Vodacom stated that the proposed validity period of three (3) years will limit customer choices that are available in the market and the benefit of buying data bundles with different sizes at different price points.91 Vodacom also stated that the unintended consequences of prescribing the minimum validity period of three years will be the termination of non-qualifying and lower priced offers resulting in customers paying more for data services.92 |
| 3.12.1.18 | Vodacom further stated that the proposed validity period of three (3) years will dilute competition93 to the detriment of end-users and also reduce the ability of licensees to efficiently manage network use and investment.94 |
| 3.12.1.19 | Crystal Web Mobile and LEASP stated that the Authority’s interpretation of section 63 of the CPA was incorrect. Crystal Web Mobile and LEASP were of the view that section 63 applied to prepaid voucher or prepaid credit balance.95 |
| 3.12.1.20 | Cell C submitted that regulation 8B(3) was not in line with the minimum standard for the quality of the products or transparent provision of information to consumers in terms of section 69(3) and (5) of the ECA.96 |
| 3.12.1.21 | Cell C indicated that the proposed three (3) year expiry period for data bundles will significantly increase costs for consumers contrary to sections 2(m)97 and (n)98 of the ECA.99 |
| 3.12.1.22 | Cell C indicated that the proposed three (3) year validity period will make provisioning100 of capacity on its network close to impossible and resulting in increased unpredictable costs. Cell C also indicated that the proposed maximum validity period will increase its current liabilities in the form of unearned revenue, which will impact on its ability to obtain financing at a reasonable cost. Other costs expected to increase are related to information technology licenses required to maintain a subscriber on the Home Location Register, maintenance cost of data allocated over three (3) years, roaming costs, etc. Cell C indicated that these additional costs will be passed onto customers.101 |
| 3.12.1.23 | Cell C stated that numbering capacity will be affected as licensees will not be able to recycle numbers if there was no activity within three (3) years.102 |
| 3.12.1.24 | Telkom stated that it offered a variety of validity periods, ranging between thirty-one (31) days and twelve (12) months. Telkom stated that extending the current data validity periods to three (3) years will have a negative impact on current data pricing and differentiation.103 |
| 3.12.1.25 | Telkom was of the view that small licensees like Telkom Mobile will be restricted in their ability to provide innovative products and pricing which differentiates it from larger operators, should this provision be promulgated in its current form. |
| 3.12.1.26 | Telkom indicated that the proposed three (3) year minimum validity period will disrupt its business model as its network was configured to support its current data plans and expiry data business rules. |
| 3.12.1.27 | Telkom raised a concern about the negative impact of extending the minimum validity period to three (3)years on numbering resources as it will be required to keep numbers active for three (3) years even if they were not used. |
| 3.12.1.28 | Amandla.mobi stated that the proposed regulation will stifle competition introduced by Cell C and Telkom Mobile to the detriment of consumers.104 |
| 3.12.1.29 | Amandla.mobi was of the view that users who buy small data bundles which were depleted in less than 30 days will be disadvantaged as they were likely to pay more than what they currently pay.105 |
| 3.12.1.30 | Amandla.mobi recommended that the expiry period should be reduced to between ninety (90) to one hundred and twenty (120) days.106 |
| 3.12.2 | The Authority’s Decision |
| 3.12.2.1 | The Authority deleted regulation 8B(3) of the draft second EUSSC Regulations in the final Regulations after careful consideration of submissions by interested parties. However, the Authority is of the view that the NCC, as the custodian of the CPA, should take the necessary steps to enforce compliance with section 63 of the CPA. |
| 3.12.2.2 | The Authority will provide assistance to the NCC on this matter, if necessary, in line with the Memorandum of Understanding between the Authority and NCC. |
| 3.12.2.3 | However, after consideration of submissions on the first draft EUSSC Regulations and the second draft EUSSC Regulations, the Authority has included the provision for roll over of unused data for all users before expiry. The Authority is of the view that the business rules (including terms and conditions of the roll over) relating to the roll over of unused data should be determined by licensees. In addition, the Authority is of the view that rolled over data should be depleted first before the depletion of new allocated data bundles to ensure that end-users derive maximum benefit from the rolled over data. |
| 3.12.2.4 | Without being overly prescriptive in respect of the expiry period of rolled over data, the Authority would like to encourage Licensees not to expire rolled over data before the expiry date of new allocated data bundle. |
| 3.12.2.5 | The Authority is of the view that this provision will benefit end-users by minimising the risk of premature expiry of data bundles. The Authority is also of the view that this provision will not impact negatively on licensees as some licensees are offering this option to their subscribers. |
| 3.13 | Insertion of regulation 8B(4) |
| 3.13.1 | Submissions Received |
| 3.13.1.1 | ISPA stated that regulation 8B(4) overlooked the difference between Electronic Communications Network Services and Electronic Communications Services as data bundles are allocated to the end user by the ECS licensee who provides access to the network by an ECNS. ISPA stated that end-users using the same ECS provider do not necessarily have the same ECNS provider.107 |
| 3.13.1.2 | ISPA further stated that the ability to transfer rolled over data between users on the same ECS who in turn use the same ECNS required software development which would require considerable amount of time. ISPA also stated that with regard to ECS providers using different ECNS service providers, data transfer will not be technically feasible.108 |
| 3.13.1.3 | ISPA stated that this regulation should be deleted and replaced with a regulation governing the practice with regard to depletion of rolled-over unused data. ISPA recommended the that regulation 8B4 be replaced and amended as follows: |
"Where data has been rolled over for post-paid users, a Licensee must account for the data in such a manner that the oldest allocation of data is depleted before more recent allocations of data." 109
| 3.13.1.4 | Liquid Telecom supported this provision. Liquid Telecom was however of the opinion that this provision was only technically feasible for licensees with integrated ECNS and ECS operations.110 |
| 3.13.1.5 | Liquid Telecom was of the view that the proposed transfer of data would require complex and time consuming development and also could result in end-users transferring data into unlicensed operators or a reseller without reseller exemption and could be used for the purposes of money laundering.111 |
| 3.13.1.6 | MTN stated that the proposed option to roll over unused data was overly prescriptive.112 |
| 3.13.1.7 | MTN stated that it was providing an option to transfer data to its customers. However, MTN cautioned the Authority that this provision is overly prescriptive and amounts to an attempt by the Authority to prescribe contractual terms governing the provision of data services to end-users. MTN stated that this was further not in line with section 69(5) of the ECA. |
| 3.13.1.8 | MTN submitted that regulation 8B(4) should be deleted in its entirety. |
| 3.13.1.9 | MWEB supported the proposed option with regard to roll over of unused data.113 |
| 3.13.1.10 | MWEB was of the view that the proposed option to transfer data to other users would create an administrative burden on licensees which could result in increases in the price of data services.114 |
| 3.13.1.11 | FMFSA stated that this provision requires licensees to offer a choice to end-users on unrelated issues. In addition, FMFSA stated that this provision is prescriptive and intrudes in the commercial activities of licensees, which is ultra vires.115 |
| 3.13.1.12 | Vodacom stated that this provision is ultra vires the powers conferred to the Authority in terms of section 69 of the ECA.116 Vodacom was of the view that the motivation117 for this provision did not justify regulation of roll over or transfer of data. |
| 3.13.1.13 | WAPA was of the view that this provision will result in increased data prices as licensees would be required to develop systems to comply with it especially where end-users are connected to the same ECS service provider who was provided access by different ENCS service provider.118 |
| 3.13.1.14 | The NCC submitted that this provision contradicted section 14 and regulation 15 of the CPA as it permits the forfeiture of rolled over data that remained beyond the next billing period. |
| 3.13.1.15 | Cell C stated that it allows its post-paid users to roll over data for one calendar month and transfer of data among its subscribers119. However, Cell C was of the view that this provision will make it difficult for licensees to estimate network capacity and this may result in overprovision of capacity on its network.120 |
| 3.13.1.16 | Telkom stated that the transfer of data between different data bundles was complex and implementing this proposed option will result in increased costs which will be passed onto consumers in the form of increase in data prices.121 |
| 3.13.2 | The Authority’s Decision |
After consideration of submissions on the second draft EUSSC Regulations, the Authority has amended the provision for transfer of data to allow all end-users to transfer data to other users on the same network. Similar to rollover of unused data provision, the Authority is of the considered view that transfer of data provision will benefit end-users as they will be able to manage the risk of expiry of unused data. The Authority is also of the view that this provision will not impact negatively on licensees as some licensees are offering this option to their subscribers.
3.14 Insertion of regulation 8(C)(1)
3.14.1 Submissions Received
| 3.14.1.1 | ISPA was of the view that this provision was applicable to mobile operators. ISPA recommended that the Regulations be explicit in this regard.122 |
| 3.14.1.2 | MWEB was of the view that educational awareness campaigns should be conducted by the Authority, not licensees, to ensure consistency and that the correct message is conveyed to end-users.123 |
| 3.14.1.3 | WAPA recommended the deletion of this provision or amendment to indicate which category of licensees will be required to conduct the proposed campaigns.124 |
| 3.14.1.4 | Telkom supported this provision and was of the view that it complies with the proposed regulation.125 |
| 3.14.2 | The Authority’s Decision |
The Authority is of the view that educational awareness campaigns are necessary particularly given the growth in data penetration and smartphone penetration. The Authority is also of the view that this provision will assist endusers to, among others, to better monitor and manage the use of their devices and avoid unexpected data charges.
3.15 Insertion of regulation 8(C)2
3.15.1 Submission Received
| 3.15.1.1 | Telkom was of the view that the Authority should not prescribe the number of awareness campaigns that should be carried out by operators. |
| 3.15.2 | The Authority’s Decision |
The Authority is of the view that a minimum of four campaign will not be burdensome on licensees.
3.16 Amendment to regulation 13
3.16.1 No submissions received.
3.17 Short Title and Commencement
3.17.1 Submission Received
| 3.17.1.1 | WAPA recommended that the Authority defer the implementation of the Regulations to after the publication thereof to ensure that licensees understand how to comply with the Regulations. |
3.17.2 The Authority’s Decision
The Authority agreed with WAPA and has amended this regulation accordingly.
| 8 | Liquid Telecom submission Para 14.4 Page 5 |
| 9 | Vodacom submission Para 11-19 Page 3-5 |
| 11 | Licensees can increase the number of alerts, if deemed necessary. |
| 12 | MTN submission para 3.2.2 Page 8 |
| 14 | Vodacom submission para 35 Page 35-36 |
| 15 | Vodacom submission para 36 Page 8 |
| 18 | Cell C submission Para 59 Page 15 |
| 20 | Telkom submission Page 5 |
| 21 | MTN submission Para 4.4.4 Page 20 |
| 22 | Ibid Para 3.3.4 Page 10 |
| 23 | Vodacom submission Para 11-19 Page 3-5 |
| 25 | Cell C submission Para 58 Page 14 |
| 26 | Licensees can increase the number of alerts |
| 27 | MTN submission Para 4.4.5 Page 20 |
| 28 | Vodacom submission Para 37 Page 8 |
| 30 | Telkom submission Page 7 |
| 31 | MTN submission Para 2.7.3;3.3.2 Page 6; 9 |
| 32 | Ibid Para 3.3.3 Page 9-10 |
| 33 | MWEB submission Para 17 Page 4-5 |
| 34 | Telkom submission, Page 7 |
| 36 | Amandla.mobi submission Para 2 Page 4 |
| 37 | Amandla.mobi submission Para 3 Page 4-5 |
| 38 | Section 69(5)(d) states that "The matters which an end-user and subscriber service charter may address include but are not limited to─…(d) end-user and subscriber charging, billing, collection and credit practices…"[our emphasis] |
| 39 | Section 69(5)(f) states that "The matters which an end-user and subscriber service charter may address include but are not limited to─…(f) any other matter of concern to end-users and subscribers." [our emphasis] |
| 40 | These measures includes usage limits for post-paid users and data depletion notifications via SMS, push USSD or USSD prompts when data usage reach certain thresholds. |
| 42 | ISPA submission Para 9 Page 3 |
| 43 | WAPA submission Para 11 Page 2 |
| 44 | Liquid Telecom submission Para 15.3 Page 5 |
| 45 | Ibid Para 15.4-15.6 Page 5 |
| 46 | MTN submission Para 3.3.5 Page 10 |
| 47 | Ibid Para 3.3.6 Page 10 |
| 48 | MWEB submission Para 17 Page 4-5 |
| 49 | Vodacom submission Para 42 Page 9 |
| 51 | Cell C submission Para 43-44 Page 11 |
| 53 | Amandla.mobi submission Para 3 Page 4-5 |
| 54 | MTN submission Para 3.4 Page 11 |
| 56 | Cell C submission Para 44 Page 11 |
| 57 | Subscribers on FreeMe plans are by default reverted to out-of-bundle usage rates. However, subscribers may change this option to be redirected to Telkom’s out-of-bundle re-direct page. Additionally, post-paid subscribers can choose the amount by which they are prepared to spend on out-of-bundle usage rates once their bundles are depleted. Source: Telkom submission |
| 58 | Liquid Telecom submission Para 15.3 Page 5 |
| 59 | Vodacom submission Para 48.2 Page 11 |
| 62 | Post-paid users can set a permanent monthly usage limit of greater than or equal to monthly subscription fee to control their out-of-bundle spend on data (and other services). Post-paid users can load additional data bundles on a temporary or permanent basis. |
| 63 | Despite licensees implementing usage depletion notifications and advising end-users to buy data bundles to avoid being charged out-of-bundle rates, these notification are not necessarily adequate as they are not provided in real-time all the time resulting in end-users running into out-of- bundle charges and paying high out-of-bundle rates using their airtime. |
| 64 | MTN Group CEO, Mr. Rob Shuter, and Vodacom Group CEO, Mr. Shameel Joosub, have publicly acknowledged that out-of-bundle data prices are high. Source: https://mybroadband.co.za/news/cellular/250045-vodacom-and-mtnsubscribers-pay-up-to-2600-more-for-outp-of-bundle-data.html |
| 65 | ISPA submission Para 10 Page 3 |
| 66 | WAPA submission Para 12 Page 2 |
| 68 | ISPA submission Para 11 Page 3 |
| 70 | WAPA submission Para 5 Page 2 |
| 71 | Liquid Telecom submission Para 15.9 Page 6 |
| 72 | MTN submission Para 3.5.2 Page 11 |
| 73 | Ibid Para 3.5.3.2-3.5.3.5 Page 12-13 |
| 74 | MTN supplementary submission dated 9 March 2018 |
| 75 | Ibid Para 3.5.4-3.5.11 Page 13-16 |
| 76 | Ibid Para 3.5.12 Page 17 |
| 77 | Ibid Para 3.5.13 Page 17-18 |
| 78 | MTN submission Para 3.5.14 Page 18 |
| 79 | MWEB submission Para 18 Page 5 |
| 80 | FMFSA submission Page 3 |
| 83 | Vodacom submission Para 69 Page 16; Para 73 Page 16 |
| 84 | Vodacom supplementary submission Para 4 Page 2 |
| 85 | Vodacom submission Para 74 Page 16 |
| 86 | Vodacom supplementary submission Para 12 Page 4 |
| 87 | Vodacom submission para 7-8 Page 3 |
| 88 | Section 2(f) enjoins the Authority to "promote competition within the ICT sector" |
| 89 | Section 2(y) enjoins the Authority to "refrain from undue interference in the commercial activities of licensees while taking into account the electronic communications needs of the public" |
| 90 | Vodacom supplementary submission Para 12 Page 4 |
| 91 | Ibid Para 66 Page 15. Also its presentation during the public hearings held on 1 March 2018, Vodacom indicated that 62% of its subscriber base use data bundles with validity period of less than 30 days, with data bundles with shorted validity period being the most popular. For example, 1GB data bundle cost between R29 and R149 depending on the validity period. |
| 92 | Vodacom presentation dated 1 March 2018 Slide No. 7 |
| 93 | Operators will offer data bundles with the same validity period |
| 94 | Vodacom presentation dated 1 March 2018 Slide No. 7 |
| 95 | Crystal Web Mobile and LEASP submission Para 8-9 Page 3 |
| 96 | Cell C submission Para 14-15 Page 4 |
| 97 | Section 2(m) enjoins the Authority to "ensure the provision of a variety of quality electronic communications services at reasonable prices" |
| 98 | Section 2(n) enjoins the Authority to "promote the interests of consumers with regard to price, quality and the variety of electronic communications services" |
| 100 | Cell C stated that provisioning is the assessment of capacity needs to make available for network usage in a given month in order to know how much capacity to lease from its service providers |
| 101 | Ibid Par 21-26 Page 5-7 |
| 103 | Telkom submission Page 9-11 |
| 104 | Amandla.mobi submission Para 1 Page 4 |
| 107 | ISPA submission Para 12 Page 4 |
| 109 | ISPA submission Para 14-15 Page 4 |
| 110 | Liquid Telecom Para 12.11-15.12 Page 6 |
| 111 | Liquid Telecom Para 15.3-15.4 Page 6-7 |
| 112 | MTN submission Para 3.6.1 Page 19 |
| 113 | MWEB submission Para 19 Page 5 |
| 115 | Free Market Foundation submission Page 6-8 |
| 116 | Vodacom submission Para 78-79 Page 17 |
| 117 | Second draft EUSSC Regulations Page 26 |
| 118 | WAPA submission Para 13 Page 2-3 |
| 119 | Cell C submission Para 48 Page 12 |
| 121 | Telkom submission Page 13 |
| 122 | ISPA submission Para 17 Page 5 |
| 123 | MWEB submission Para 20 Page 5 |
| 124 | WAPA submission 15 Page 3 |
| 125 | Telkom submission Page 13-15 |
