Telecom companies get nod to increase tariffs

September 27, 2021

BUSINESS REPORTER

THE Postal and Telecommunication Regulatory Authority of Zimbabwe (Potraz) has granted telecom operators the nod to increase out-of-bundle tariffs by an average of 30% as the capital-intensive industry continues to battle rising input costs.

State-owned mobile network operator NetOne was the first to adjust its charges on September 26 while Econet Wireless Zimbabwe and TelOne have indicated that they will adjust their headline tariffs Wednesday (September 29).

Zimbabwe’s telcos have been marginally adjusting prices for promotional bundles, but headline tariffs had not been reviewed since September 2020, despite a general rise in prices of goods and services over the past 12 months.

Information Communication and Technology (ICT) minister Gift Machengete recently told Parliament that the telecommunications sector was struggling to secure foreign currency from the Reserve Bank of Zimbabwe auction system, required for infrastructure investment, capital expenditure, and the servicing of rising external debt, said to be now over US$1bn across the industry.

“The foreign currency requirements of these companies are so huge that it cannot fully be obtained through the auction system,” the minister said.

According to the latest price schedule, NetOne’s 10 gigabytes (GB) will now cost ZWL$2 500, up from ZWL$2 000, while 25GB of data has been pegged at ZW$4 250, up from ZWL$3 500. A 50GB data package now costs ZWL$6 250, up from ZWL$5,000.

At the same time, TelOne’s new voice tariffs for landline-to-landline calls have been reviewed upwards to ZW$6.34 per minute for local calls, while landline-to-mobile tariffs are now going for ZW$7.38 per minute.

The State-owned fixed network provider’s 10GB residential broadband bundle has risen from ZWL$1 082 to ZW$1 499, and a 20 GB bundle for corporate use now costs ZWL$2 698, up from ZWL$1 948.

Zimbabwe’s largest mobile network operator Econet Wireless, also adjusted its voice bundles from ZWL$0.1070 per second to ZW$0.1668, and SMS has been reviewed to ZWL$2.05 from ZWL$1.64.

The company’s data bundles have been increased to ZWL$1.58 per megabyte (MB), up from the previous figure of ZW$1.26 per MB.

Potraz director-general Gift Machengete recently said the country’s telecommunications operators needed heavy capital investments in order to remain relevant, especially at a time demand for ICTs has surged due to the Covid-19 pandemic.

“The necessity for greater investment in digital technologies, skills, resilience, and innovation can never be overemphasised,” he said.

Machengete further indicated that foreign currency shortages were having a significant impact on the sector, and urged the government to find ways of helping the telcos.

“The shift to the auction-based foreign currency market system seemingly eased inflationary pressures, but did not eliminate them completely as prices for goods and services, including fuel and energy, continued to be adjusted in line with the dynamics of the new exchange rate regime,” he said in the latest industry report.

“Notwithstanding the above, foreign currency shortages continued to bedevil the economy at large, with implications on network expansion, upgrade, and maintenance, taking a toll on the quality of service as demand for data surged for operators. Foreign currency constraints also affected universal service projects targeted for rural and underserved areas.”

 

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