Vodacon

It has been a rather interesting week (last week) for Vodacom in South Africa.

First, they pulled a Kansas City Shuffle on everyone by announcing that they had listened to South Africans complaining about high mobile data costs and that they had decided that from mid-October 2017 they will be dropping out-of-bundle mobile data prices for pre-paid customers by up to 50%. Now, to the uninitiated, out-of-bundle is when the mobile data package you purchased has "expired" (how!?!) and your mobile services provider starts charging your Internet usage to your airtime. Here's the catch, in the case of Vodacom this out-of-bundle price for prepaid customers is ZAR1.00 per MB. While the lowest in-bundle pricing (if you want your data to last for 30 days) is as low as ZAR0.15c. You don't need a distinction in Calculus to figure out that even after the possible 50% discount, Vodacom's out-of-bundle is still more expensive than in-bundle pricing. Note that, when South Africans have been complaining that #DataMustFall, it was a complaint against the ZAR0.15c per MB in-bundle pricing.

Q: Now, why would Vodacom make such an announcement?

A: Kansas City Shuffle, i.e. diverts attention.

Then a day or so later after that announcement, South Africa's Competition Commission revealed that it will be investigating Vodacom for abusing its dominant position. Specifically relating to the contract it won to be the telecommunications provider for South Africa's National Treasury. A deal which has now seen them capture the rest of government as a client.

Lastly, as if again to divert attention (although it was probably an unfortunate coincidence given that exercises like this are planned months ahead of time for a company the size of Vodacom), a day later they announced that they had re-branded. Stating that their business is "shifting from a telecom provider to everything digital."

Jay Z The Story of OJ

Back to the point about high mobile Internet prices in South Africa, one of our subscribers pointed out (re a leboha James Francis!), the Internet capacity you use through Vodacom (or any mobile services provider) comes from the same cable (out of the sea) as the Internet you use for ADSL or fiber, why then is it so much more expensive than fiber connectivity in South Africa?

Given that majority of South Africans access, the Internet via mobile devices shouldn't mobile Internet pricing be cheaper?

Perhaps it is the time we gave up on mobile service providers in South Africa and started shifting our attention to pushing for fiber infrastructure to be more widespread so that even in rural and informal settlements people can get affordable high-speed Internet via Wi-Fi at a minimum. After all, fixed-line Internet access will likely be always cheaper than mobile for the foreseeable future.

What do you think?

This article first appeared on 9 October 2017 in the iAfrikan Weekly Digest Newsletter, a Pan Afrikan weekly digest of the most important stories of the week which includes insights and analysis on the most topical story of the week. Subscribe here to the weekly digest and receive it every Monday morning at 06h00 Central African Time.

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