Zimbabwe: Mobile Tariffs Increase Justifiable

20 March 2020

President of ICT Association of Zimbabwe Engineer Jacob Mtisi has justified the recent voice and data tariffs increases as a good way of maintaining a balance between service affordability and the viability of mobile network operators.

This follows after the Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) had approved a 57 percent upward review for voice, data and SMS tariffs to catch up with the "constantly rising operating costs" affecting the telecoms sector last week.

Potraz also approved a 49 percent Internet Access Providers (IAP) internet tariffs upward review, a move which will see the price of internet connection per minute moving up to $0,33 from $0,21.

In an interview with The Herald Finance and Business, Eng Mtisi said;

"Considering that our Zimbabwe dollar has depreciated to a level where our data and voice changes are not profitable. We are in such a dire economic situation where the impact on consumers will severely impact their pocket. Our inflation is at 540 percent and yet the salaries are stagnant"

Engineer Mtisi said the quality of service is poor because the service providers are not getting the revenue to upgrade their services.

"Remember most mobile users are now using WhatsApp to call, text and send videos thereby cutting the revenue for voice calls for MNOs."

He went on to say Infrastructure sharing helps the situation, as it reduces charges by a massive margin.

Eng Mtisi said he was involved in the due diligence of the $484 million infrastructure sharing deal which he believes will provide massive coverage in the country.

Prices for on net calls per minute, SMS per message and mobile data per megabyte moved up from $0,75, $0,19 and $0,15 to $1,17, $0,30 and $0,23 respectively.

Econet Wireless Zimbabwe (EWZ) recently made an average of 20 percent upward review for its SMS and data bundle prices aligning them with the prevailing inflationary environment.

The new data tariffs, which came into effect last week on Wednesday, came as a result of the significant weakening of local currency which has lost 93 percent of its value from 1: 2,5 when the interbank rate was introduced in February 2019 to the current 1:40.

So far, the move has raised questions and attracted a lot of criticism, mainly because the floor prices make SMS and data bundles more expensive, affecting users that have adopted some of these bundles as a way of managing the already high cost of internet access in Zimbabwe.

Potraz's aim is to keep the price of data as low and as affordable as possible, while ensuring sustainability of the sector and protection of consumer.

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