South Africa: Competition Watchdog Blasts Vodacom and MTN for 'Excessive Pricing' of Mobile Data


A Competition Commission official told Business Maverick that the watchdog is expecting legal action from Vodacom and MTN on its findings. 'We are prepared to fight them and defend our findings vigorously,' the official said.

It's perhaps justified that customers of SA's largest telecommunications company, Vodacom, have seen red - like its brand colour - over their sky-high mobile data costs in recent years.

Vodacom's pricing model of mobile data for its 43 million customers in SA has received a drubbing from the Competition Commission, confirming what many people have always suspected.

In its final data services market inquiry report released on Monday 2 December 2019, the competition watchdog found that Vodacom's profits are not a function of its agility or innovation in the telecommunications industry but "excessive pricing" on mobile data products, mainly prepaid.

According to the commission, Vodacom has "substantial market power" that allows it to charge customers high mark-ups on mobile data prices of between 20% and 25% on average over the past six-years - well above inflation in each year.

"This level of mark-ups is sufficiently high to establish a prima facie case of excessive pricing by Vodacom," the commission said in its final report, adding...

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