Network Provider MTN has dropped the price of its 1GB monthly data bundle from R149 to R99 in South Africa has learned. 

Telecom operators in the country have recently reduced data prices after a two-year investigation by the Competition Commission found that internet rates for prepaid packages were too high.

After an announcement in March that it will drop data prices for its 30-day bundles by up to 50 per cent from mid-April, MTN reached an agreement with the commission to reduce its mobile data prices from May 1. This follows similar agreements with Vodacom, Telkom and Cell C.

As part of the agreement, the cost of MTN’s 1GB monthly data bundle, which has been the subject of much scrutiny by commission authorities, will fall from R149 to R99.

MD of technology market research firm World Wide Worx, Arthur Goldstuck, said these price cuts are “a good start, and one cannot dismiss a 33% rate cut as a token. Small data bundles have been cut by up to 40%, which makes a significant impact on affordability of data.”
However, “this still does not address the need for truly low-cost data for the poor,” he said. 

Goldstuck said data prices have been falling for many years for those who can afford large bundles. “Now it is falling for those further down the spending chain,” though “it still needs to reach the bottom of the pyramid, namely those who perceive themselves as being able to use data only on an ad hoc basis, don’t believe they can afford large bundles, and therefore use data off their airtime, which remains expensive.”

Mobile operators are expecting margins to take a hit because of the price cuts.  MTN has 29-million subscribers on its network and has been working to grow its data revenues. For the financial year to end-December 2019, MTN made R12.6bn in revenue from its data services in SA. 

Ofentse Dazela -Director of pricing research at  information communication technology consulting company Africa Analysis, noted that mobile operators were not transparent about their input costs, such as how much it costs to deliver a gigabyte of data, “then the next logical yardstick is (to) look at revenue numbers reported to assess whether the price cuts are acceptable, although revenue numbers alone only tell half the story.”

Vodacom, SA’s largest operator, cut mobile data prices by up to 40% from April 1. Dazela said it is obvious that larger mobile operators “have only moved as far as matching their data offerings to that offered by small operators in the market that have been pushing price wars”. To that extent, there is still more room for data prices to fall in the local market, he said.

As far as operators are concerned, “the issue regarding perceived high data prices should be blamed on our policymakers who for years showed lack of political will to create an enabling environment for them”, said Dazela.

He added that the government should expedite the permanent allocation of spectrum, which operators have long argued as a reason for high data prices over the past decade.

Goldstuck said the commission and the mobile network operators had failed in one regard: while they had declared a range of predetermined sites and services as zero-rated, they had failed to create a unified pool of these sites.

“Instead, each operator had created their own independent set of zero-rated sites. This means one of the main benefits of zero-rating, which is to provide free access to educational resources, cannot address the need or potential of schools to offer their students access to free educational material, he said.

Goldstuck said;

ecause every subscriber has access to a different set of sites and services, a school cannot mandate use of specific free services, and only those schools whose students can afford commercial access are able to take advantage of online teaching.

“If this is addressed, the only barrier to entry becomes the device itself, and that is far easier to address than the combination of complexity of access and disjointedness of resources,” he said.

However, Nigerians are yet to enjoy the recent slash in data price by MTN in South Africa. observed that in terms of DATA BUNDLE, MTN monthly bundle still stands at N1,000 for 1.5 GB; N1,200 for 2GB; N1,500 for 3GB; N2,000 for 4.5GB; N2,500 for 6GB; N3,500 for 10GB; N5, 000 for 15GB.

Meanwhile, the weekly plans remain: N300 for 350MB; N500 for 1.5GB; N500 for 750MB (2 weeks plan); N500 for 500 MB+ 1,000 talktime

Amidst the covid-19 pandemic, Nigerian were said to have recieved free 300 SMS , of which they get the privilege to use 10 sms per day.

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