POTRAZ doubles voice and data tariffs: A gargantuan burden for consumers

TAKUDZWA HILLARY CHIWANZA

HARARE — In a move to cushion the capital-intensive telecommunications industry reeling under the negative impact of a rapidly depreciating local currency, the  Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) has moved to hike voice and data tariffs in what is regarded a heavy burden for consumers.

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In the face of a highly volatile macro-economic environment marked with soaring inflation, the recent adjustment in tariffs is the third this year, following adjustments in February and April. Telecommunications providers vindicate their tariff increase on the basis that this enables them to maintain the value of their services.

With the recent adjustment, voice tariffs have jumped to US$0.40 per minute, up from US$0.20 per minute, while data tariffs are now pegged at US$0.63 per megabyte.

Local internet service provider, Liquid Home Zimbabwe, informed its clients of a 100% data increase starting next month, with another 50% increment scheduled for December 1, 2023.

Potraz says the tariff review is based on changes in the Telecommunications Price Index.

“The last computation for the sector was done in February 2023. At that time, we were using the July to December 2022 post-information. Now, the changes in the Telecommunications Price Index are used to review tariffs, and we did that in February and April 2023. At that time, we produced the tariffs of ZWL$94.41 for voice, ZWL$14.93 for data per megabyte, and ZWL$19.41 for SMS. These tariffs are no longer viable and fall well below regional average tariffs,” Gift Machengete, the Director-General of POTRAZ, said.

Why tariff reviews are a cause for concern

As it stands, internet access remains a huge challenge for many Zimbabweans. While the government takes pride in increased rates of internet penetration, the quality and accessibility of connections is severely limited in practice. Penetration hovers in the low figures particularly in rural and peri-urban areas due to high costs and lack of infrastructure.

Zimbabwe’s perennially moribund economy has been a major hindrance to internet access for Zimbabweans, especially because incomes are continuously eroded in an environment where the costs of goods, the internet included, are high and unstable.

As such, the recent tariff increase does little to help more Zimbabweans in accessing internet services . While these tariff adjustments may provide relief to telecommunications providers in terms of costs, they pose a challenge for consumers, as most receive their salaries in the local currency.

The predicament of high internet charges has been an ongoing concern, with a report from the Zimbabwe Coalition on Debt and Development saying that the sector's dominance by monopolistic interests, weak regulatory oversight, and consumer protection mechanisms contribute to the problem, making it imperative to address pricing caps to protect the economically prejudiced.

What is more concerning is that despite such tariff increases being implemented, the quality of internet services still leaves a lot to be desired. Zimbabwean internet users frequently experience several connectivity disruptions because of unreliable infrastructure.

High internet prices combined with unreliable infrastructure are a disconcerting concoction derailing the progress of internet access in Zimbabwe.

Without adequate government investment in the information and communications technology (ICT) the deterioration and inaccessibility of internet services will remain the order of the day; and shifting the burden to telecommunication companies will always be of little help — high operating costs will always result in high tariffs from telecoms providers.