Cell C fires back at Vodacom in rates price war

Three days after Vodacom responded to Cell C's 99c rate for international calls with an 89c tariff, the latter has responded with an even lower fee.

Just three days after Vodacom announced they had slashed international call rates to 89c per minute (see story here) in what appeared to be a response to Cell C's 99c rate for international calls, Cell C has responded with an even lower rate.

Cell C today announced the launch of a new international calling promotion, which offers customers the lowest international call rates in South Africa, when calling from a mobile phone. Calls to 50 international destinations will now cost 85c per minute on per second billing for Cell C customers. Calls to both international mobile and fixed line numbers will benefit from the 85c international calling promotional rate.

Cell C has taken advantage of Vodacom's complex process for making use of low call rates by highlighting the fact that the reduction will occur automatically. 

"Cell C customers will not have to pay a monthly fee and don’t need to opt-in (no catches, no restrictions, no fine print, no clauses…it’s that simple!) to benefit from the lower call rate," read its statement. "All customers will automatically be charged the new lower rate of 85c when calling any of the countries included in the promotion"

Cell C CEO Alan Knott-Craig added: “We promised we would better the rate if our competition responded to our standard international call rate, and we have. Now, with the 85c promotion, Cell C customers can truly experience the lowest international call rate in South Africa from a mobile phone.”

The promotion will be available to Cell C customers from 28 October 2012 and will end 31 January 2013.

“It’s during the holiday season that customers who have family and friends abroad would like to make contact most. We are pleased to be able to offer our customers the best possible rate in the market,” says Knott-Craig. 

As reported previously in Gadget, the networks are able to slash international call rates to below those of local calls because of the high interconnect fee for terminating calls between networks locally. The current 56c interconnect call - due to drop to 40c next March - means local call costs between networks cannot fall below around 90c, given the margin networks need to make on top of the interconnect fee. By next March, this minimum call cost can come down to around 75c.

For international calls, the limits are dramatically lower, based on the termination rates negotiated globally - and these can be as low as a few cents.

The following countries will form part of Cell C's 85c promotion:

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