Vodacom decision to cut data prices welcomed
MOBILE telecommunications company Vodacom’s decision to cut data costs by more than 30% from April 1 has been welcomed by civil society organisations and consumer bodies.
Vodacom signed an agreement with the Competition Commission yesterday. Under the agreement, which is subject to confirmation by the Competition Tribunal, Vodacom committed to a two-year substantial reduction on monthly data bundles across the board.
From April, Vodacom, which already applies zero-rates data costs (or free data services) for government websites, will expand this to all public universities, technical and vocational educational training colleges and public schools.
The decision comes after the Competition Commission’s report last December which confirmed that South Africa’s data prices were too high, relative to the rest of the continent.
Clif Johnston, the vice-chairperson of the SA National Consumer Union (Sancu), said while Vodacom’s announcement was good news for consumers, the “proof of the pudding was in the eating”.
He said Sancu looked forward to seeing how the new tariffs were put into practice.
“In many cases, the most economical tariff is not the one provided by default, and consumers often end up paying more than they need to because they don’t understand how to switch to the best tariff,” he said.
He added that this was the case with Vodacom’s prepaid voice service and may also be true of the different data options.
Right2Know (R2K) spokesperson Lazola Kati said the advocacy organisation was pleased with Vodacom’s willingness to come forward and show consideration for consumers’ needs.
Kati said R2K was encouraged with the zero-rated internet search function powered by Encyclopaedia and Wikipedia and the commitment of seven free-to-use websites for Vodacom users.
“We believe it’s going to help a lot of upcoming businesses, students, pupils and career-driven people to at least have access to information,” she said.
However, Kati said R2K was worried that the reduction in the price of 1 gigabyte of data from R149 to R99 was still a bit steep for poor consumers.
Alison Gillwald, the executive director of Research ICT Africa, said any extensions of zero-rated services and data price reductions were welcomed. She said South Africa’s data prices were more expensive than more than half of other African countries and unaffordable for the 50% of the South Africans who were online.
Gillwald said it would also be important for the Independent Communications Authority of SA (Icasa) to take action to ensure a competitive environment for Cell C and Telkom, the smaller market players.
“Unless they reduce their prices, they would now be competing with Vodacom not only on quality, but price as well,” she said. Icasa would need to expedite the implementation of their market enquiry to level the field, otherwise the smaller players would not be able to reduce their prices to put further pricing pressure on Vodacom.
Reacting to the zero-rate data services for schools, KwaZulu-Natal Department of Education spokesperson Muzi Mahlambi welcomed the announcement.