Government suspends data tariff increases

Source: Government suspends data tariff increases | The Financial Gazette January 13, 2017

THE Minister for Information, Communication and Technology and Courier Services (ICT) Supa Mandiwanzira has directed the immediate suspension of tariff increases that were effected two days ago following a directive from state regulator the Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ).

He also directed mobile network operators who had increased their tariffs to refund their customers for the data used in the past two days.

POTRAZ agreed to a proposal by mobile operators to increase prices but Mandiwanzira who had to respond to the situation while on his annual leave, said that while it is conceivable that the price of data may go up, “the margin by which the prices have gone up is shockingly high and can only reflect insensitivity to fellow Zimbabweans and gluttonous corporate greed.”

In a statement,  Mandiwanzira went on to say: “unreasonable data prices, especially in a high literacy country like ours, undermine our huge investments in human capital, broadband infrastructure and the ability to attract investment. My Ministry’s Innovation Fund initiative, which has raised more than US$6 million to date, is premised on affordable broadband and growth opportunities in on-line enterprises in Zimbabwe and beyond”.

He said on the occasion of the official opening of the Chikato Community Information Centre in Masvingo last month, President, Robert Mugabe, spoke passionately about his desire to bring marginalized communities, especially in rural areas, onto the information superhighway. “This in itself, is instructive that broadband access must be affordable.”

Mandiwanza said, given the astronomical rates that have been charged over the last two days, it may be necessary and morally correct to get the concerned mobile networks to refund their subscribers.

“This shall be on the agenda when I undertake a comprehensive review of the developments of the last two days on the first day of my return from leave on January 30th.” he said.

Prisca Mupfumira is the acting minister.
In Regulatory Determination No 1 of 2016 correspondence in December, POTRAZ had directed mobile operators to set the floor price for traditional voice services at 12c per minute and the floor price for data at 2c per megabyte. Econet Wireless, Zimbabwe’s largest mobile network operator was the first to implement the new floor prices, which reflected massive increase in data prices and outlawed price cuts for bundled services, promotions and over the top offerings, which had made internet cheaply accessible.

POTRAZ said the new floor prices, which many consider astronomical and more than just a barrier to internet access and penetration via use of widely used mobile phone, were meant to stop plunging revenue of operators, which it said dropped by 11-12 percent since January 2016. Zimbabwe’s penetration stands at over 98 percent.

Starting January 11, Econet pegged its lowest data offering of 5 megabytes at 50 cents on standard connection and doubled the data access with another 5MB, which customers could access via the MNO’s WiFi hotspots.

For a dollar, internet users would get only 10MB, which would be doubled with another 10MB on WiFi. The highest data offering of 2,5 gigabytes, which would double to 5GB on WiFI, would now cost consumers a staggering US$50.

While data for popular social media platforms such as Whatsapp and Facebook were charged under bundled services quoted daily, weekly and monthly a negligible rates, they would now be accessible based on amount of data purchased.

The country’s second biggest mobile phone operator, NetOne, sensing the potential negative impact of the new floor prices, which was going to hit hard on its widely popular OneFusion offering, swiftly moved to engage the regulator to take a second look into the data prices.

Econet Wireless, last night announced that it will be reversing the tariffs.

In a statement last night Econent said: “Whilst continuing to engage POTRAZ concerning the data floor pricing directive, Econet Wireless is reverting to the old data tariffs. It became apparent after implementing the POTRAZ directive that Econet Wireless was the only operator which had complied with the data floor pricing.”

“It is clear that, for whatever reason, the other operators had not complied with the directive and therefore there can never be a level playing field when our customers are the only ones being affected by this position. This is not the first time that Econet has complied and the other operators have not complied. Appropriate updates will be given on any future developments regarding this matter”.

Econet on Thursday said it acknowledged that it recent implementation of the new floor pricing for data, which it contends was only done in compliance with the directive issued to all mobile network operators by the industry regulator “had not only inconvenienced you our valued Customers but has caused pain.”

However in another statement released last night, POTRAZ said it was concerned and disturbed by the conduct, double standard, negative utterances and refusal to take ownership of the decision by MNOs.

“POTRAZ positively received the plea by operators and eventually agreed to the introduction of a moderated floor price which would ensure both sector viability and continuous service provision to consumers.

“It is clear that this decision has been met with consumer outcry. It is against this background that POTRAZ would like to advise consumers and stakeholders in general of its decision to withdraw Regulatory Determination No 1 of 2016 with immediate effect”. Staff/FinX