The big changes Vodacom, MTN and other operators are expected to introduce this year – including free data
The Competition Commission has extended the deadline for its new data recommendations as it remains deep in discussions with both Vodacom and MTN about the changes.
The commission said that it has had ‘productive engagements’ with the two operators as well as other affected mobile network operators with regards to the findings and recommendations.
Given that the engagements with the operators are at an advanced stage, the commission said it has decided to extend the two-month deadline by one month (from February until March 2020) to allow sufficient time to conclude the talks.
It published its final report on the Data Services Market Inquiry at the beginning of December 2019.
In its report, it characterised the data services market as highly concentrated with a duopoly in the form of MTN and Vodacom, which enjoy significant market power relative to smaller competitors.
To remedy this, the commission’s final package of recommendations comprises a combination of immediate and intermediate measures to reduce the cost of high data prices.
Specialist telco legal firm Ellipsis has provided a list of some of the most notable recommendations. The deadline for these recommendations is currently set for 2 March 2020, and they include:
- Reduce tariffs – Vodacom and MTN must independently reach an agreement with the Commission on a substantial and immediate reduction of tariff levels, especially prepaid monthly bundles;
- Costs of sub-500MB bundles – Vodacom and MTN must independently reach an agreement with the Commission on a reduction in the headline prices of all sub-500MB, 30-day prepaid data bundles;
- Free ‘lifeline’ data – All mobile operators are to reach an agreement with the Commission to offer all prepaid subscribers a lifeline package of daily free data to ensure all citizens have data access on a continual basis, regardless of income levels;
- Zero-rating – All mobile operators are to reach an agreement with the Commission on a consistent industry-wide approach to the zero-rating of content from public benefit organisations and educational institutions;
- Data notifications – All mobile operators are to reach an agreement with the Commission to inform each subscriber, on a monthly basis, of the effective price for all data consumed by the customer.
Vodacom Group chief executive officer, Shameel Joosub, on Tuesday (4 January), pointed to an improved financial performance following “the significant impacts over the past year from our ongoing pricing transformation strategy”.
“These included substantial cuts in out-of-bundle tariffs and lower bundle prices, resulting in a circa 50% decline in effective data prices since March 2016,” he said.
Vodacom Group said that it added 484,000 customers in South Africa in the last quarter, supported by a successful Summer campaign.
The mobile operator said that for the quarter ended December 2019, ]group revenue climbed 6.6%, supported by group service revenue growth of 5.7%.
South Africa revenue and service revenue growth rates improved to 5.9% and 4.6% respectively, supported by increased data uptake as the group continues to transform pricing, it said.
“Vodacom remains committed to delivering on its pricing transformation strategy and has engaged constructively with relevant authorities, including the Competition Commission, to share the measures we intend to introduce in due course to further reduce data prices,” Joosub said.
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