Data Must Fall: Competition watchdog extends deadline for operators

The Competition Commission has given Vodacom and MTN – the country’s major network operators – another month to reduce data prices.

In December, the commission released its Data Services Market Inquiry final report, which recommended the two mobile network operators reach an agreement within a two-month period with the commission to reduce data prices. This in particular pertained to monthly bundles and to address the structure of data pricing, reducing the cost per MB for smaller sub-1GB bundles relative to the 1GB price.

“The report also recommended that these operators reach agreement with the commission on other pro-poor measures within three months, and these included free data and zero rating of public benefit organisations,” the Competition Commission’s Sipho Ngema said in a statement.

Engaging with MTN, Vodacom and other affected stakeholders

“Given that the engagements with the operators are at an advanced stage, the commission has decided to extend the two-month deadline by one month to allow sufficient time to conclude these engagements,” Ngema said.

Both MTN and Cell C have been warned they would face prosecution should they fail to address the pricing.

Ebrahim Patel: Data costs critical for entire economy

Trade and Industry Minister Ebrahim Patel has in the meantime welcomed the report by the commission and said data costs are critical for not just for the performance of the digital economy, but that of the entire economy.

“The Competition Commission found that there is indeed a competition problem in the market for data. The report notes that data prices are higher than they should be, and higher than in many other markets elsewhere in the world,” Patel said.

“The commission also found that profitability levels are very high, reflecting anti-competitive outcomes and potentially the subject of an excessive pricing investigation. It drew attention to the structure and practices in the market that results in discrimination against lower paid consumers and they found that the roaming markets are either not working or not working as they should.”

Report in hands of Stella Ndabeni-Abrahams

Patel handed over the report to Communications and Digital Technologies Minister Stella Ndabeni-Abrahams who said her department has engaged in efforts to reduce data costs in South Africa.

“Data access and affordability are integral to ensure the full participation of our communities in the digital economy. As a department, we have prioritised spectrum licensing as part of the interventions to reduce the cost of data,” Ndabeni-Abrahams said.