Nairobi — Tanzania Telecommunication Company Ltd customers will from this month enjoy a 50 per cent cut in Internet charges, making Tanzania the first East African country to lower Internet charges.

TTCL chief executive officer Said Amour Said, told The EastAfrican that the lowering of charges follows the firm's connecting to the Seacom submarine fibre optic cable.

"TTCL has reduced its Internet prices effective from October 1, in order to pass on this cost saving benefit to the end users, and the high customer expectations of reduced costs on Internet services have finally been met," he said.

The new prices will see high volume Internet users including banks, large businesses and corporations, government agencies and other institutions enjoying a substantial Internet bandwidth cost reduction as customers will get the same capacity of bandwidth at a third the current prices.

Under the new structure, a client who buys 1Mbps of Internet capacity for Tsh9.2 million ($7,000) will now buy the same capacity for just Tsh3.14 million ($2,415).

For small and medium businesses like cyber cafes, the price has been slashed by 50 per cent.

According to Mr Said, customers who were buying 5GB for $200 (Tsh200,000) will now buy 10GB for the same amount of money, and that all Internet subscribers in this category would continue to get high speed of up to 4Mbps through their TTCL fixed lines.

According to the new tariff, non-commercial ordinary clients will enjoy a new package with unlimited use for a monthly price of Tsh45,000 ($ 43) with a speed of up to 256Kbps.

"It is an ideal service mostly for the common man because it is affordable and guarantees continuous usage," explained Mr Said.

Meanwhile, the ICT sector in the country has received a major boost following the a $100 million credit from the World Bank's International Development Association to promote affordable communications services.

Tanzania is one of three sub-Saharan states that will benefit from a credit totalling $151 million approved in late June by the World Bank.

According to the World Bank, Malawi will get $20 million while Mozambique will get $31 million in this third phase of the Regional Communications Infrastructure Programme (RCIP3).

In total, the $424 million regional programme is expected to increase availability of reliable communication services for citizens, businesses and governments in Eastern and Southern Africa.

Despite considerable developments in the ICT sector in Africa over the past 10 years, the region still has the world's lowest telephone and Internet user penetration.

Tanzania, for instance, had 400,000 Internet users -- one percent of the population -- as of March 2008, according to International telecommunication Union.

Mozambique had 200,000 Internet users or 0.9 per cent of the population, Uganda 750,000 or 2.4 per cent of the population, while Kenya had 3 million Internet users or 7.9 per cent, the largest number in the region.

Economic development in Eastern and Southern Africa is held back by prohibitive ICT costs and limited communications infrastructure," said Rick Scobey, World Bank Acting Director for Regional Integration in sub-Saharan Africa.

Mr Scobey said recently that RCIP is helping the region to leverage the exciting developments in the sector and overcome the challenges through a combination of sound policy and regulatory frameworks, competitive market structures, and catalytic investments into public-private partnerships to accelerate the rollout of infrastructure networks.

In Tanzania, the project will strengthen the policy and regulatory environment and promote sectoral reform.

In addition, the project will scale up the national vital registration system, enhance accessibility of land records through websites and mobile phone text messages, and develop an e-procurement pilot scheme for the Medical Stores Department.