Zimbabwe’s biggest mobile network operator Econet Wireless Zimbabwe made upward adjustments to its data bundle tariffs in a largely expected move. This was after State-owned operators NetOne and Telecel’s data bundle prices had been adjusted a few days back.
The new data package aptly named ‘Smart Data Bouquet’ came into effect on the 29th of April 2019 is very different from the data bundles that customers were familiar with.
According to Econet the idea behind these data bouquets is to promote the use of other applications in use and popular today or was once unknown. The most interesting feature on these bouquets is how they have been structured in a way that has caused so much outcry from its subscribers. It appears that Econet is somehow out of touch with reality as their bouquets fail to offer much in terms of what most Zimbabweans use on a daily basis.
The new data bouquet portfolio now offers a wider selection where subscribers are given more options to choose from including Instagram, Twitter, WhatsApp and Facebook combined with Snapchat while still maintaining daily, weekly and monthly bundles.
A monthly data bouquet worth RTGS$10 will give a subscriber 270MB which is 32,5 percent less than the 400MB a subscriber used to get for the same amount prior to the changes. Before the new tariffs, an RTGS$5 data bundle would buy 200MB, but as a result of the changes, it will now purchase 130MB, a 35 percent decrease.
However, not all bundles have been slashed though, as a subscriber who used to get a monthly bundle of 25MB for RTGS$1 will now get 50MB if they pay RTGS$2. Those who want a close to a dollar deal will get a 20MB bundle costing RTGS$0,90. This is not much of a difference to the old 25MB bundle that cost RTGS$1 prior to the new changes.
Video and Wifi bouquets have been included in the new portfolio.
The new prices are Econet’s way of aligning its business with the rampant price increases in the economy. In a statement dated 24 April 2019, the Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) stated that mobile network operators can legally charge up to 0,05 RTGS cents per megabyte or RTGS $50 per gigabyte before tax.
It is important to note that Zimbabwean mobile network operators mainly sell bundled data. Bundled data refers to data bundles that limit access to specific Apps such as Facebook, WhatsApp, and Twitter.
Alternatively, some bundle data expires within a limited amount of time. In the Zimbabwean context, mobile data expires after a 30-day period.
At face value, this pricing model appears to be more affordable. However, this pricing structure is actually more pr ofitable for mobile network operators and more expensive for the consumer. For example, if a subscriber buys a 1-gigabyte bundle of data that is valid for a day at RTGS $5, that subscriber would, in theory, spend around RTGS $150 on Internet in a 30-day month.
The POTRAZ threshold for data costs translates to about $15 to $20 per gigabyte in United States dollar terms. A regional comparative would show that Zimbabwean data is not that expensive, considering for example that South Africa charges an average US$11 per gigabyte of data.
Unfortunately, the Zimbabwean situation is made complex by the fact that the cost of services such as the Internet and mobile data have gone up in response to the devaluation of the RTGS dollar, but average salaries or incomes have remained largely stagnant.
That is why the debate on Internet costs in Zimbabwe should be in relation to the national average monthly income and not the cost of data in neighbouring countries or regions. If average monthly income is about RTGS $450 that means the current cost of a gigabyte of data is more than 10% of an average Zimbabwean’s salary. That is unjustifiably high.
In a Press statement on the data price increase Media Institute of Southern Africa (MISA-Zimbabwe) condemned the price increases saying that even before the devaluation of the Zimbabwean currency internet service providers had already implemented several data cost increases in the name of coping with the rising inflation and service delivery costs.
The Alliance for Affordable Internet (A4AI) has come up with a formula that caters for each country’s unique conditions. The A4AI argues that the Internet is affordable if a gigabyte of mobile out-of-bundle broadband data is priced at 2% or less of average monthly income. In terms of this formula, Zimbabwean mobile data is still woefully expensive.
POTRAZ reports that as of 31 December 2018, 8,7 million Zimbabweans had access to the Internet. The same report indicates that most Zimbabweans accessed the Internet via their mobile devices. Increases in Internet costs, especially mobile data costs will most likely see a reduction in the number of Zimbabweans that can access the Internet.
Limited access to the Internet also means Zimbabweans will not be able to enjoy their rights to access information and to share their opinions in online spaces. This means that these inordinate hikes in data costs become an indirect attack on people’s constitutional rights.
In the long term, a reduction in the number of people with access to the Internet will in turn stunt economic growth in Zimbabwe.