Telecom Services

MTN Accused Of Anti-Competitive Behaviour With Bulk SMS Sales

As reported by BMA sources, MTN is allegedly abusing its cellular market dominance by providing bulk SMSes to its customers at a lower price than its competitors. The anti-competitive behaviour entails MTN as the only supplier that can process SMSes on the MTN network to other networks and mostly smaller black-owned service providers buying the service from MTN to provide to their customers.

It appears that as part of a deal, MTN agreed to sell SMSes to other networks and wireless application service providers (Wasps) for between US$0,0081 and US$ 0,010 per SMS. The Star has obtained a document of an interconnection agreement between MTN and other networks. In the document, MTN agrees to sell SMSes to the market at a price of not less than 0,0081 USD per SMS.

MTN's Enterprise Development Unit (EBU), according to a whistleblower, is selling SMSes to banks at US$ 0,059 per SMS, purposely undercutting all other service providers despite specifically contracting with them not to. According to the source, MTN's chief digital officer, Ernst Fonternel, has not been alerted about this unethical business practice by the EBU.

MTN EBU CEO Wandla Matandela responded to the above as, "Not true." He went on to say that "MTN aspires to the greatest levels of fairness for all customers and rivals, and has rigorous TCF (treat customers fairly) principles in place, which it attempts to apply to Wasp consumers as well."

The Group added that "there was no basis to suggest MTN is discriminating and/or anti-competitive in its SMS charges. They have dedicated to working closely with regulators on any issue that may require their involvement." The minutes of the Wasp AGM on March 24, 2021, are available for reference. A response from regulating authorities ICASA and the Competition Commission is yet to be received.


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