The new battleground
In the latest struggle between telcos and consumers, do Icasa’s proposals go far enough to make a difference?
Is it too soon for consumers to pat themselves on the back? Government initiated a second inquiry into mobile data last week, after a #Datamustfall campaign drew attention to the problems in the way consumers are charged by mobile operators.
The latest action — draft regulations published by the Independent Communications Authority of SA (Icasa) — could change the way operators apply expiry dates to data bundles. It comes after government’s recent decision to investigate data prices.
Data has become the new battleground for mobile operators and consumers. It is a huge growth area for service providers, accounting for between 25% and 35% of their revenue.
Over time, data may even overtake revenue from voice calls. The ability to make calls using services such as Whatsapp and Facebook will drive this. It has created the need for consumers to buy data bundles, which are a more costeffective way to purchase data.
At the end of June Vodacom reported an 18.1% rise in date revenue, to R5.5bn.
Active smart devices on its network increased by 18.4% to 16.6m, with the average monthly data used on these devices increasing to 734 MB per device.
In the six months to June, MTN SA grew data revenue by 18.5%. Cell C has 12.5m active data subscribers and generates R4.4bn in data revenue.
Icasa’s proposed amendments to its end-user and subscriber service charter regulations provide suggested expiry dates for data bundles (see graphic). A 1 GB bundle, it suggests, should have a 60day validity period.
At the moment, the most common validity period for data is 30 days, though some operators offer longer periods on some packages.
But Icasa’s proposed changes fail to address the fundamental flaw in the structure of data pricing in SA, says World Wide Worx analyst Arthur Goldstuck.
He says that in their current form, the changes “would allow operators to continue punishing the poor for being poor”.
Prepaid subscribers, who are largely low- to middle-income