The Ministry of Communications and Digital Technologies, together with the Independent Communications Authority of South Africa, (ICASA) have welcomed Vodacom’s settlement agreement on data prices.
“Today’s announcement is an important milestone in our quest to ensure that data prices are affordable for the majority of South Africans as this is a key driver for the Fourth Industrial Revolution,” Minister of Communications and Digital Technologies, Stella Ndabeni-Abrahams, said in a statement on Tuesday.
Her remarks follow Vodacom’s announcement to cut its data bundle prices by more than 30% across all of its channels as of 1 April 2020.
The mobile operator reached an agreement with the Competition Commission following a market inquiry report into mobile data services, which found that South Africa’s data prices are excessively high.
In July 2019, government issued the Policy on High Demand Spectrum which culminated in ICASA kick-starting the licensing process.
ICASA is currently undertaking two critical regulatory processes that have a bearing on the pricing of data services in the medium term, such as the licensing of the International Mobile Telephony (IMT), also known as high demand spectrum as well as an inquiry into mobile broadband service markets.
“It is our concerted view as a regulator that the licensing of high demand spectrum is one of the critical components that will facilitate deployment of digital infrastructure as well as building an inclusive digital society, with the goal of ensuring that all South Africans participate meaningfully in the opportunities emanating from the Fourth Industrial Revolution,” said ICASA Acting Chairperson, Dr Keabetswe Modimoeng.
The Ministry said the spectrum auction will take place by no later than the end of the year as announced by the President during the State of the Nation Address (SONA).
However, the licensing of the Wireless Open Access Network (WOAN) will be concluded in 2021.
“With regards to the Mobile Broadband Services Market, the settlement facilitated by the commission is aimed at providing immediate relief to consumers in respect of the retail prices to ensure consumers pay the rates that are affordable.
“However, the discussion document issued by ICASA notes that there are structural problems in the wholesale layer of the data services market. ICASA would therefore like to specifically address that layer and intervene as it has a regulatory mandate to protect consumers against unfair business practice and ineffective competition in this regard,” the Ministry said.
This process will address challenges at the wholesale layer specifically as it relates to, among others, national roaming, site access and competition matters including barriers to entry.
“These measures are in line with the policy prescripts to promote effective competition and to facilitate entry by new players in the market whilst also advancing the transformation agenda within the Information and Communications Technology (ICT) sector, while stimulating economic growth,” the Ministry said.
The Draft Regulations on Mobile Broadband Services Market will be released by July 2020 for public consultation and completed by the end of the financial year.