South Africa’s Competition Commission has released its final report on data prices, showing that consumers are paying more than they should for access to the internet. The Commission called the high price of data “anti-poor” and noted that networks such as MTN and Vodacom offer lower prices in other African countries where they operate. To combat these issues, the Commission said that all networks should offer prepaid subscribers a ‘lifeline package’ of daily free data to ensure all citizens have data access on a continual basis, regardless of income levels.
The precise level of lifeline data and any annual adjustments should be determined in consultation with industry, Icasa and relevant experts, the report said. The Commission is of the view that it should be sufficient to ensure each citizen’s participation in the online economy and society.
In addition, Vodacom and MTN must independently reach an agreement with it on "substantial and immediate reductions on tariff levels" within the next two months, the regulator said, adding that preliminary evidence suggests there is scope for price reductions of 30-50 percent. It also called for the two operators to reduce the cost of all sub-500MB 30-day prepaid data bundles as well as stop "partitioning strategies that contribute to anti-poor pricing and/or inferior service".
Other proposals include all mobile operators offering within three months zero-rated data for content from public benefit organisations and educational institutions, and informing each subscriber, on a monthly basis, of the effective price for all data consumed.
Furthermore, Telkom Openserve must reach an agreement with the Commission on substantial reductions in the price of IP Connect to remove excessive pricing concerns within two months. Openserve’s IP Connect product allows ISPs to offer fibre and ADSL products by paying to move traffic over Telkom’s network. The Commission said it requested Telkom to provide it with the cost of providing its IP Connect service, after which it found that it constitutes a case of “excessive pricing”.
