ICASA has compared the cost of data within the BRICS nations upon the public's request. The report found South Africa rated third most expensive by comparison. Briefly.co.za takes a look the reasons behind the steep price
The Independent Communications Authority of South Africa ( ICASA) has released it's report on the cost of data among the BRICS nations ( including South Africa, Brazil, Russia, India and China).
The report detailed how South Africa rated the third most expensive country to purchase data, a vital tool for citizens to have access to broader communities and vital information.
Analyzing tariff plans among local operators, ICASA found that the difference between the cheapest and most expensive 2GB package was as much as R170 rand.
However, the cost of data locally is not the most expensive, according to ICASA:
“SA does not have the most expensive prepaid data bundle prices for the 500MB, 1GB, and 2GB in the SADC region. It is also not the cheapest, however, its prices are below the average price of all the SADC prices across the categories,”
Our SADC neighbour Botswana pays R371.53 for 500MB, while our other neighbour Zimbabwe pays R413.33 for 1GB.
But why is data in South Africa so expensive?
One of the simplest answers to this question is - spectrum. Spectrum ( or radio frequency spectrum) dictates operators ability to provide data transfer to consumers. According to a recent Fin24 report, this is a limited national resource, owned by South Africans and presided over by ICASA.
Essentially, operators such as Vodacom and Cell C, rent access to the spectrum. The CEO of Vodacom, Shameel Joosub, claims that if spectrum would be made available data prices would plunge by 'almost half'.
MTN shares the sentiment, believing that spectrum is the 'primary obstacle' to bringing data prices down. However, Graham de Vries says that there are other factors to consider, should the needed spectrum be made available, saying:
"Say, for instance, the exchange rate goes down by 20% and we get extra frequency – that may not necessarily mean that costs will be less because you still have to import equipment so that the very frequency that you now have can be 'switched on', so to speak, on the network."
This equates to a dismal situation for consumers calling for price reductions. Although ICASA will be auctioning off the much needed resource in April 2019, financial relief would still be a long way away.
The necessary equipment would then need to be put in place and the costs of this would be carried by the consumers.
Cell C's Candice Jones maintains that the spectrum being made available will not single-highhandedly bring prices down. Jones explains:
"We can't have a system that allows dominant players ways to gain access to spectrum while excluding the smaller operators from gaining access to that resource. It is ultimately the smaller players that drive down costs through competition,"
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