Zimbabwe slashes mobile data costs by 60 percent

Zimbabwe’s telecoms regulator has slashed the cost of mobile data and that of mobile transactions by 60 percent from next month, to make access to the internet more affordable but this is likely to hit incomes of mobile operators.

With revenue from voice calls continuing to drop, data has become the major driver of earnings but the Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) feels the cost of data remains too high.

“The Out of bundle mobile data charges threshold shall be reduced from the current 12.5 cents per megabyte to 5 cents per megabyte exclusive to of all taxes. This applies to internet/data that is used outside the WhatsApp, Facebook and Twitter bundles among others,” said POTRAZ.

Zimbabwe’s largest mobile operator, Econet Wireless recorded total revenue of $831.6 million for the full year to February 28, 2018. Revenue from voice, at $355.1 million, comprised 42.7 percent of total income, down from 51.2 percent last year.

Of the $476.5 million non-voice income, data brought in $144.8 million — about 30.3 percent — after an 18 percent growth over the prior year. This number will likely come in lower when the new tariffs are implemented, said analysts.

POTRAZ also slashed mobile transactions by 60 percent from the current 12.5c a session to 5c per session exclusive of all taxes, a move it says will ‘address the high transaction cost of e-payments and increase financial inclusion.’

“To ensure that this reduction benefits the transacting public, the Authority has engaged the RBZ who will engage Financial Service Providers so that the reduction is passed on to the transacting public,” said POTRAZ.

With Zimbabwe in the throes of a liquidity crisis, mobile money provided an effective alternative to cash for making payments, with all three of the mobile operators running platforms.

Latest POTRAZ data shows that mobile transactions reached $1.6 billion in 2017 while active mobile money subscriptions increased by 42.5 percent to reach 4 706 778.

The tariff cut will also impact earnings, according to analysts. –The Source

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