Call termination rates: the floor under every call price

What a termination rate actually is

When you call someone on another network, your provider pays their provider to complete the call. That fee is the termination rate, and it is the raw material cost of every call price you see.

Two flavours exist. The mobile termination rate (MTR) is what a network pays to land a call on Vodacom, MTN, Cell C or Telkom Mobile. The fixed termination rate (FTR) is the equivalent for landing a call on a fixed or VoIP network. Both are capped by ICASA under the Electronic Communications Act, because a network holds a monopoly on reaching its own subscribers and would otherwise charge whatever it liked. That is not a theoretical risk; it is exactly what the market looked like before regulation.

The fee is invisible on your invoice, but it is the floor under the retail price. A provider can absorb its own network costs and trim its margin, yet it can never sell a cross-network call below what it pays the other side to terminate it. When ICASA cuts the rate, the floor drops for every provider at once. A separate Bill now before Parliament aims at the wholesale layer above that: what the ECA Amendment Bill means for business phone and data costs.

Sixteen years of rate cuts, in one timeline

South Africa’s termination rate has fallen roughly 97% since 2010. The glide path was slow and repeatedly contested in court, but the direction never changed.

The 2024 final amendments: the rates now in force

ICASA’s December 2024 gazette replaced the aggressive March 2024 draft with a slower, deeper glide path. These are the numbers that matter until mid-2027.

The draft had proposed slashing mobile to 4c and fixed to 1c by July 2025, within roughly 15 months. After public hearings in June 2024 and heavy pushback from operators, the final regulations spread the same destination over three years. The first cut only took effect on 1 July 2025, a full year later than the draft envisaged. All rates below are cents per minute, excluding VAT.

The end of asymmetry, except for genuine newcomers

For over a decade, “small” operators (in practice Cell C and Telkom’s mobile arm) were allowed to charge rivals more for terminating calls than they paid in return. It was a deliberate subsidy to help them compete with Vodacom and MTN. The 2024 regulations killed it: small-operator rates converged with the large operators’ 5c on 1 July 2026, and asymmetry now exists only for true new entrants, defined as licensees with under three years in the market.

What ISPA and the smaller operators argued

Not everyone cheered the cuts. The sharpest objections came from the fixed and VoIP side of the industry, and they are worth understanding because they shape what happens after 2027.

ISPA, the internet industry’s official representative body, called the fixed-line cuts too aggressive. Its members pointed out that a 1c FTR is extraordinarily low by world standards; Switch Telecom noted that Europe’s fixed termination rate runs about 40% higher than what ICASA proposed, in markets that are denser and cheaper to serve than South Africa. ISPA’s core argument was for parity: with fixed–mobile substitution accelerating, there is no longer a good cost reason for mobile termination to sit at four times the fixed rate, as it will from July 2027.

On the mobile side, Cell C CEO Jorge Mendes warned that cutting rates while removing asymmetry would “disproportionately benefit dominant players”. Telkom made a similar case and argued ICASA’s cost model punished operators for their historical infrastructure investments. ICASA proceeded anyway, betting that a level, low-rate playing field beats a subsidised one. Whether the challengers can still fund network competition at 4c a minute is the open question the next review will inherit.

What this means for your phone bill

Termination rates explain the shape of every South African rate card: cheap on-net, moderate national, expensive mobile. Once you see the floor, you can judge the markup.

Take Switch Telecom’s published rates as a worked example. On its Package 1, an on-net call costs R0.13 per minute, a national call R0.24 and a call to a mobile R0.43, all excluding VAT, billed in 30-second increments after a 60-second minimum. Package 2 charges R0.15, R0.26 and R0.52 with per-second billing from the first second. The pattern is the termination regime made visible: no wholesale fee on-net, a small fixed fee on national calls, and the mobile termination fee plus radio network costs on the expensive leg.

Those Switch rates have been in place since April 2018, when mobile termination cost 13c. The wholesale floor has since fallen to 5c, and it hits 4c next July. That gap is your negotiating room. Some providers pass cuts through quickly, others quietly bank them, so the question “when did you last reprice your mobile rate?” belongs in every procurement conversation.

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