Cost of communications back on the rise in Southern Africa

PCWorld News

The cost of communications in Southern Africa is rising, as operators raise rates to cover network expansion costs and make up for inflation, which is digging into their profits.

Zambian mobile phone operators were increased tariffs last year and were last week joined by operators in the Democratic Republic of Congo (DRC) and Malawi.

In Malawi, just like the DRC, the operators claimed the price increase was the only way to ensure profits needed for investments in network expansion and infrastructure development.

The Southern African countries face increasing inflation rates compared to other regions. Telecoms Networks Malawi (TNM) Malawi, DRC’s Tigo and Orange have all decided to adjust their tariffs in order to keep pace with financing needs of their operations.

In DRC, the cost of calling per minute has been doubled with 50 units of airtime now giving users only five minutes, down from the previous 10 minutes.

In Malawi TNM has announced a 14 percent rise in its tariffs, which could mean that mobile phone expenses will swell to over two-thirds of people’s average monthly earnings in the country.

TNM added that the cost of utilities, goods and services have significantly increased in Malawi in the past year and thus eroded the returns for telecommunication operators.

The Consumer Association of Malawi (CAMA), a consumer watchdog, has protested the increase in mobile tariffs in the poor Southern African country and has demanded that the telecom sector regulator, that Malawi Telecommunications Regulatory Authority (Macra) stop the hike.

In his letter to TNM and Macra, CAMA executive director John Kapito said, “the increase is unethical and immoral considering the fact that consumers continue complaining about the poor services that your network provides.”

Macra said however, that it cannot stop TNM from hiking tariffs. Instead, it said it is contemplating bringing more operators into the market in order to increase competition and force a reduction in mobile phone tariffs in the sector, now monopolized by NTM and Airtel.

Findings by research instituted by Macra in January this year indicated that Malawi’s phone and Internet access prices rank highest among African countries.

On average, the cost of making mobile phone calls in Malawi is 72 kwacha ($0.164) per minute within the network and $0.205 per minute between networks.

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