A mobile pricing report, based on research by two independent firms, debunks the long-held belief that low-end mobile subscribers in South Africa are getting a raw deal.<\/p>\n
The Independent Communications Authority of South Africa (Icasa) recently told parliament<\/strong><\/a> that pre-paid mobile costs in South Africa were “way above” most other African countries.<\/p>\n ANC MP Livhuhani Mabija concurred, saying that the poorest of the poor are suffering because of the inability of Icasa to reduce mobile prices.<\/p>\n Communications minister Yunus Carrim reiterated this view<\/strong><\/a>, saying in September 2013 that South Africa ranks only 23rd on the African continent in terms of affordability of communication.<\/p>\n Carrim added that this worsens the \u201cdivide between the \u2018haves\u2019 and \u2018have nots\u2019 created by a past of inequality\u201d.<\/p>\n However, these views are debunked by a report which shows that South Africa\u2019s low-end mobile prices are well below countries with similar conditions to South Africa.<\/p>\n In 2012 South Africa\u2019s mobile operators commissioned a report to establish how local mobile prices compare with international standards.<\/p>\n The report titled \u201cAnalysing the Cost of Mobile Communications\u201d was done by two independent research firms – Strategy Analytics and Pygma Consulting.<\/p>\n What sets this report apart from other studies is that the research firms had access to sensitive information from Vodacom, MTN, and Cell C.<\/p>\n This information included the actual effective mobile tariffs paid by consumers, which guaranteed an accurate reflection of local prices.<\/p>\n The research firms selected 10 peer countries similar to South Africa based on demographics, geography, GDP and other relevant factors.<\/p>\n Seven different user profiles were then identified which reflect prices from a mobile user\u2019s perspective.<\/p>\n Mobile prices were benchmarked against the peer countries, with the results taking purchasing power parity and tax levels into account.<\/p>\n The sensitive nature of the information contained in the report means that the results were never made public.<\/p>\n It is understood that all the parties involved in this report, including the mobile operators, were sworn to secrecy through strict non-disclosure agreements.<\/p>\n However, after former MTN SA CEO Karel Pienaar presented some of the results to parliament in November 2012, curiosity started to grow about what the report revealed.<\/p>\n The \u201cAnalysing the Cost of Mobile Communications\u201d report showed that the low-end of the South African mobile market received a very good deal when compared to the selected peer countries.<\/p>\n The high-end of the market paid more than their international counterparts for mobile services.<\/p>\n This report debunks the widely held belief that South Africa\u2019s low-end market is receiving a raw deal, while high-end consumers score. The reality is in fact quite the opposite.<\/p>\n The report compared prices based on seven baskets – 4 pre-paid and 3 post-paid (contract) baskets. The baskets ranged from \u201clow-low\u201d pre-paid to \u201chigh\u201d post-paid.<\/p>\n These seven baskets were broken into two groups \u2013 \u201cvoice and SMS\u201d and \u201cvoice, SMS and data\u201d.<\/p>\n The following summary of results show that low-end products serving low-income South Africans are cheap relative to the benchmarked countries, while high-end products serving the high-income segment are relatively expensive.<\/p>\n This article was first published on MyBroadband<\/a>.<\/p>\n Messaging apps driving SA mobile economy<\/a><\/strong><\/p>\n SA mobile operators struck by vandalism<\/a><\/strong><\/p>\n\u201cSecret\u201d report commissioned to find the truth<\/h3>\n
Report and results kept secret<\/h3>\n
Research results<\/h3>\n
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\n South African mobile prices benchmarked<\/strong><\/span><\/td>\n<\/tr>\n \n Basket<\/strong><\/td>\n Pre-paid voice, SMS and data<\/strong><\/td>\n Pre-paid voice and SMS<\/strong><\/td>\n Post-paid voice, SMS and data<\/strong><\/td>\n Post-paid voice and SMS<\/strong><\/td>\n<\/tr>\n \n <\/td>\n Low-income mobile subscribers<\/strong><\/em><\/td>\n <\/td>\n<\/tr>\n \n Low-low<\/td>\n 65% cheaper<\/span><\/td>\n 44% cheaper<\/span><\/td>\n<\/tr>\n \n Low<\/td>\n 29% cheaper<\/span><\/td>\n 11% cheaper<\/span><\/td>\n 51% cheaper<\/span><\/td>\n 38% cheaper<\/span><\/td>\n<\/tr>\n \n Medium<\/td>\n 15% cheaper<\/span><\/td>\n 5% more expensive<\/span><\/td>\n 29% cheaper<\/span><\/td>\n 10% more expensive<\/span><\/td>\n<\/tr>\n \n High<\/td>\n 10% cheaper<\/span><\/td>\n 23% more expensive<\/span><\/td>\n 9% more expensive<\/span><\/td>\n 80% more expensive<\/span><\/td>\n<\/tr>\n \n <\/td>\n High-income mobile subscribers<\/strong><\/em><\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n Mobile pricing results summary<\/h3>\n
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\n Voice, SMS and data<\/strong><\/span><\/td>\n<\/tr>\n \n Pre-paid baskets<\/strong><\/td>\n Ranking\/11 (lower is better)<\/strong><\/td>\n South African prices<\/strong><\/td>\n<\/tr>\n \n Low-low<\/td>\n 2<\/td>\n 65% cheaper<\/span><\/td>\n<\/tr>\n \n Low<\/td>\n 4<\/td>\n 29% cheaper<\/span><\/td>\n<\/tr>\n \n Medium<\/td>\n 5<\/td>\n 15% cheaper<\/span><\/td>\n<\/tr>\n \n High<\/td>\n 6<\/td>\n 10% cheaper<\/span><\/td>\n<\/tr>\n \n Post-paid baskets<\/strong><\/td>\n Ranking\/11 (lower is better)<\/strong><\/td>\n South African prices<\/strong><\/td>\n<\/tr>\n \n Low<\/td>\n 3<\/td>\n 51% cheaper<\/span><\/td>\n<\/tr>\n \n Medium<\/td>\n 6<\/td>\n 29% cheaper<\/span><\/td>\n<\/tr>\n \n High<\/td>\n 9<\/td>\n 9% more expensive<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n \n\n
\n Voice and SMS only<\/strong><\/span><\/td>\n<\/tr>\n \n Pre-paid baskets<\/strong><\/td>\n Ranking\/11 (lower is better)<\/strong><\/td>\n South African prices<\/strong><\/td>\n<\/tr>\n \n Low-low<\/td>\n 4<\/td>\n 44% cheaper<\/span><\/td>\n<\/tr>\n \n Low<\/td>\n 7<\/td>\n 11% cheaper<\/span><\/td>\n<\/tr>\n \n Medium<\/td>\n 7<\/td>\n 5% more expensive<\/span><\/td>\n<\/tr>\n \n High<\/td>\n 8<\/td>\n 23% more expensive<\/span><\/td>\n<\/tr>\n \n Post-paid baskets<\/strong><\/td>\n Ranking\/11 (lower is better)<\/strong><\/td>\n South African prices<\/strong><\/td>\n<\/tr>\n \n Low<\/td>\n 1<\/td>\n 38% cheaper<\/span><\/td>\n<\/tr>\n \n Medium<\/td>\n 8<\/td>\n 10% more expensive<\/span><\/td>\n<\/tr>\n \n High<\/td>\n 10<\/td>\n 80% more expensive<\/span><\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n More on SA mobile<\/h3>\n