Data prices heading for a fall

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The #DataMustFall movement brought attention to the high data prices South African consumers pay, leading to a review by the Independent Communications Authority of South Africa (Icasa) into pricing at the mobile networks. The review has resulted in the first of a number of changes to regulations, which will help data users get more bang for their buck.

People talking on cellphones

Many expected Icasa to make an announcement on the price of mobile data in South Africa, but the regulatory body said that its objective “is to develop minimum standards in respect of the provision of data, SMS, and voice services”, adding that producing pricing regulations is a lengthy process which requires an extensive market review. According to Icasa, the review that has just been completed is only the first phase, and was focused on investigating the business rules of mobile operators and addressing any unfair practices – especially those that are prejudicial to the poor.

It came as no surprise that the review found that data expiry and out-of-bundle rates could use some work. In a recent comparison of prices between mobile data on prepaid and on contract, prepaid mobile data prices were higher than contract prices. A 20GB Vodacom prepaid bundle was 204% more expensive than the equivalent contract, and MTN’s closest prepaid package was 234% more expensive than its 20GB contract. When asked about the price differences, the networks said “the flexibility of prepaid comes at a premium”.

Considering that the poor generally use prepaid services, this state of affairs will be examined by Icasa in later reviews of the industry. The first review, however, has resulted in regulations that specify that network operators will no longer be able to charge people out-of-bundle rates without telling them.

All service providers are now required to send a notification when the usage of data is at 50%, 80%, 90% and 100%. They are also required to provide an option to roll over unused data to ensure consumers don’t lose unused data. Icasa has ruled that all networks must allow data transfer between customers of the same network to be available, and most importantly, networks will no longer be allowed to charge consumers out-of-bundle rates when data has run out without first obtaining subscriber consent.

Icasa has said it has started the second phase, in which it will be identifying priority markets where the review of regulations may be necessary. This should lead to a review of pricing.

South Africans have known for a long time that our data prices are extremely high compared to other countries, and the magnitude of the difference was recently illustrated by South African cricketer Dale Steyn when he shared a comparison of data pricing between South Africa and Bali on Twitter. “Touch down South Africa. So I just bought 10GB data for R605. In Bali‚ I paid R120 for 25GB! Seriously!” he tweeted.

Cellphone users all over the country are holding thumbs that Icasa’s review ultimately results in lower data prices. In the meantime, they should consider themselves lucky that they are not Ugandan subscribers. While Uganda has more reasonable data rates, the government has proposed a tax of 100 shillings (R0.33) per day for some social media platforms such as Facebook and WhatsApp.

Image credit: Copyright: moodboard / 123RF Stock Photo


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