Zimbabwe mobile phone networks hike tariffs

HARARE - Zimbabwe's three mobile phone operators — Econet, Net*One and Telecel — have hiked their tariffs by between 35 percent and 75 percent effective January 23.

For the majority, who are pre-paid customers, it now costs $83 per minute for calls made between Econet (Buddie) users, up from $53.

Calls between Buddie and other networks are now pegged at $120 and $100 per minute for Telecel and Net*One (EasyCall) users respectively.

International calls in the group one category for Econet subscribers increased by 36 percent from $61 to $83 per minute. This category includes all regional calls.

Local SMS messages increased by 66 percent for Econet subscribers from $15 to $25.

International SMS increased from $31 to $48.

Charges for calls between EasyCall subscribers are now pegged at $90 per minute while EasyCall to Buddie and Telecel call charges increased to $112.

For EasyCall subscribers, SMS messages increased to $35 while cross network SMS messages increased to $47.

Call charges between Telecel subscribers increased to $81 per minute while those of Telecel to Buddie and EasyCall increased to $104,30 and $103,40 respectively. The rates apply during peak periods.

The last tariff adjustment was made in October last year.

However, mobile phone operators still contend that the approved tariffs are still low and threaten their viability.

The operators feel that the regulatory body, the Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ) are protecting the consumers at the expense of the industry.

A well-placed source in the mobile telecommunications, who requested anonymity, said low tariffs in the sector are stifling the operators' potential to expand.

"The regulator (POTRAZ) should put the needs of both parties (operators and consumers) at par.

"Currently operators are looked at with suspicion to the extent that a lot is done for the protection of customers at the expense of the operators.

"A balance of the two should promote the growth of operators at the same time protecting the consumers," said the source.

He added that, due to the low tariffs, the operating environment had become very hostile to the extent that it is now threatening the survival of some operators. Following the latest increase of tariffs it is now more cheaper for the consumer to communicate with a person in regional countries like South Africa and Botswana than to communicate with a person within Zimbabwe.

Using the Telecel tariffs, for example, it costs $81 per minute for a call within Zimbabwe during the peak period while it costs $74 to make a regional call per minute.

However, the cost burden is carried by the operator who has to pay US$0,15 for every call that is made beyond Zimbabwe per minute.

Local mobile phone tariffs are pegged using the COSITU or cost based model, which uses the formal exchange rate of one US$1: Z$250. The players argue that this pricing model will only be efficient if they get the foreign currency on the formal market.

"As it stands at the moment most of us are getting the foreign currency at the parallel market rate, which is much higher than the formal rate and this puts pressure on the costs that we incur as players in the industry.

"As things stand at the moment Zimbabwe offers the cheapest rates worldwide and yet has the highest inflation rate at 1 281 percent," the source said.

- Daily Mirror