South Africa watchdog to probe high data charges

The Competition Commission South Africa photo:courtesy

South Africa’s competition watchdog has launched an investigation into the high cost of Internet data, the regulator said on Friday, after a groundswell of complaints from consumers and civil society.

The Competition Commission said in a statement it had already published terms of reference for the inquiry and that it would complete its investigation by August 2018.

The regulator said it believed there were features in the market that “prevent, distort or restrict competition”, leading to excessive prices.

A 2016 World Bank report found that South Africans paid around $14.10 (Sh1,452) for one gigabyte of data, the fourth highest out of 17 African countries, compared to lowest-rated Cameroon, where the same bundle cost around $2.10 (Sh216)

In September last year a local radio personality presented a case for lower data prices to a parliamentary committee after a popular online campaign dubbed #datamustfall.

“The inquiry has been initiated in response to a request by Economic Development Minister Ebrahim Patel, who also has expressed concerns over high data costs,” the regulator said.

Five main firms dominate South Africa’s wireless broadband market, including MTN and Vodacom, which control about 70 per cent of the market, along with partially state-owned Telkom.

Analysts say the small pool of service providers, combined with slow implementation of policy by government and insufficient infrastructure have hampered competition.

Telkom and Vodacom last month said they had already launched more cost-effective mechanisms that have benefited the reduction of data prices, after the Independent Communications Authority of South Africa said it would launch an inquiry into the high data charges.