No data rollover lands broadband providers in trouble
Business Day reported today (6 December 2011) that “National Consumer Commissioner Mamodupi Mohlala has accused mobile operators iBurst and First National Bank (FNB) of contravening section 63 of the Consumer Protection Act by not rolling over unused prepaid internet data.”
Section 63 of the CPA states that pre-paid vouchers, credit and similar devices do not expire until a period of 3 years after the date on which it was issued.
According to the South African Communications Forum, the unintentional consequence for cellphone companies would be that they would not be able to recycle inactive numbers until the lapse of three years, which may mean a shortage of cellphone numbers for consumers.
According to the newspaper, Mohlala has requested Cell C, Virgin Mobile SA, MTN, Vodacom, iBurst, FNB and 8ta to amend their prepaid data policy in line with the act, and hence give subscribers ‘credits’ for unused data.
Local broadband providers are disputing that they are in contravention of the act.
Unused data rollover and breakage
It is however not only the country’s main telecoms operators who are offering data packages where the data expires at the end of each calendar month. Every single ADSL ISP in the country has such packages.
Unused data, often referred to as breakage, is one of the reasons why service providers can reduce data prices to levels which are often seen as ‘below cost’.
If all broadband service providers are forced to roll over all unused data for a minimum of three years it may result in significant price increases in data bundles.
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