Minister: Lack of Competition Responsible for High Data Prices in SA
Faizel Patel- 14-03-2018
The Minister of Telecommunications and Postal Services says the cost of communication and data prices in South Africa were not declining because the industry is “highly concentrated” with customers enjoying no competition.
Siybonga Cwele was briefing the parliamentary portfolio committee about his department’s work to reduce telecommunications costs in a bid to achieve inclusive participation in the sector and to lower the barriers to entry for South Africans.
The Independent Communications Authority of SA (Icasa) is scheduled to release its findings by June and will indicate a list of markets that should be regulated and priority markets to be subjected to market reviews while The Competition Commission is expected to release an interim report on the cost of data next month for public comment and a final report in August.
Cwele says the high roaming cost in the Southern Africa Development Community (SADC) was not coming down at a rate required by the citizens of the region, with South Africa moving slower than other countries.
He says one of the main reasons the cost of data is still high is because the industry remains highly concentrated.
“We are unlikely to see aggressive competition if we don’t open up the sector to more and new entrants. We have a strange market where it costs the poor more to access data than it costs the rich.
Cwele welcomed the progress made by Icasa on effective competition in the broadband market and the Competition Commission’s market inquiry into data services.
“These are necessary interventions but the turnaround is slow compared with the public demand and need.”
The #DataMustFall campaign gained momentum on social media networks last year, with even celebrities making a presentation in Parliament and looking at launching a class-action lawsuit against data providers.
