The SA Competition Commission Demands Lower Data Costs

Competition commissioner Tembinkosi Bonakele unveiled his provisional report on data costs on 25 April. The report is part of the Competition Commission’s market enquiry into the telecoms industry which dates back to August 2017.

The report has confirmed SA’s data prices are too high, exploit the poor and that retail price structures lack transparency. The Commission also noted that Vodacom and MTN charge higher prices in SA than they do in their other African operations (see below). The report points out that a consumer buying a 100MB data bundle will pay roughly twice the price on a per MB basis than a customer buying a 1GB bundle. Someone buying a 50MB bundle will pay up to three times more and a 20MB bundle up to four times more per MB. The Commission also recommended that local and national government support the development of free public WiFi in low income areas, including commuter points like train stations and taxi ranks, as well as public spaces like parks, shopping areas and government service offices. Whether this Report is simply a pre-election stunt before 8 May is difficult to say. ICASA began its own inquiry into telecom costs in July 2017, promising its report in a year, and we are still waiting!

As the report notes the costs of mobile internet in Africa varies enormously. Low internet connection costs are a major contributory factor in the take-up of the ecommerce. Leading countries for ecommerce in Africa enjoy low costs per 1GB of data (based on average costs) – e.g.: Rwanda $0.56; Egypt, $1.49; Ghana, $1.56; Morocco, $1.66; Nigeria, $2.22; Kenya $2.73; Senegal, $3.28, Mauritius $3.71. South Africa is by far the highest at $7.19. Source https://howmuch.net/articles/the-price-of-mobile-internet-worldwide-2019.

Meanwhile, ICASA’s new report on the State of ICT Sector in SA 2019, shows that SA ‘s smartphone penetration has nearly doubled in the last 2 years to 81.72% as of September 2018, compared to 43.5% in September 2016 and 74.2% in September 2017. ICASA recorded smartphone subscriptions at 46.9 million as at 30 September 2018.