The Independent Communications Authority of South Africa (Icasa) has put over-the-top (OTT) service providers ― including multinationals Netflix and WhatsApp, and the country’s telecommunications giants ― on notice over the pricing of their services.For the telecoms industry, the mooted inquiry announced by the regulator on Friday is the umpteenth time in the past decade that the government will inquire into the cost of communications in the country, explicitly targeting the persistent issue of high data, voice and broadband costs.The regulator said it would conduct an inquiry into the impact of OTT services on consumers. In a separate notice it said it intends to launch an inquiry into the cost of telecoms services in South Africa, which remain among the highest in the world, in a government-wide clampdown on the sector, whose major four companies are worth a total of more than R700bn.The regulator said its inquiry would be explicitly aligned with its previous market inquiries into data services and its role in monitoring pricing outcomes after spectrum assignment and pro-competitive interventions.Icasa’s move comes shortly after communications minister Solly Malatsi put out a tender looking for telecommunications experts to conduct a market analysis that could pave the way for tougher pricing interventions in the telecoms sector.The moves signal growing government frustration that one of its flagship interventions to reduce data costs, the long-delayed release of high-demand radio frequency spectrum, has failed to deliver the expected benefits for consumers.When spectrum was finally auctioned off and assigned to operators in 2022, policymakers argued that it would reduce network costs, improve coverage and drive down data prices. However, four years later those expectations remain largely unmet.The department’s tender asks experts to identify the policy and strategic choices needed to “address the high cost of communications in South Africa” and examine why previous interventions have not delivered affordable voice and data services.The telecoms industry, dominated by MTN, Vodacom, Telkom and Cell C, is no stranger to scrutiny, with the costs of data having come under Icasa’s gaze frequently in the past.High communications costs The announcement of the imminent inquiry comes a month after the department of communications & digital technologies, headed by Malatsi, launched an investigation to find the most effective policy instrument it could deploy to slash South Africa’s high communications costs for consumers and businesses.The department has expressed dissatisfaction that despite the significant spectrum rollout a few years ago and moves by telecoms majors to reduce costs after a Competition Commission-led inquiry, the costs of communicating are still elevated.“As the country is largely categorised by high levels of unevenness and complexity in terms of price of data … [this] creates a situation where citizens pay excessive data costs compared to both global and continent standards. Consequently, there is a need for policy interventions in this regard,” the request for proposal issued by the department reads.Last week South Africa’s biggest telcos (including MTN and Vodacom) launched a rare competition waiver bid to share infrastructure planning information. This is aimed at cutting capital costs and expanding connectivity in remote, underserved rural areas before committing major infrastructure spend, which runs into billions of rand annually.The inquiry into the lucrative OTT industry has not come as a complete surprise because Icasa told parliament earlier this year that it was considering a market inquiry into broadcasting OTTs to establish the impact on licensees and various markets, taking into cognisance the policy review on audiovisuals.Icasa said broadcasting services such as Netflix and WhatsApp had disrupted traditional broadcasting, which has seen regulated traditional linear broadcasting having to compete with these services for audiences and revenue. OTTs disrupt the broadcasting environment and affect the use of conventional infrastructure and networks, threatening to render them useless.Business Day