The main reason for expensive broadband access and high mobile data prices is a lack of competition.
This was revealed in the latest Affordability Report, which was published by the Alliance for Affordable Internet this week.
The Affordability Report analysed the policy progress low- and middle-income countries are making to advance affordable internet.
According to the report, millions of people around the world are kept offline because they cannot afford Internet access.
It found that “consolidated broadband markets are keeping prices high and putting life-changing internet access out of reach for hundreds of millions of people”.
The report highlighted that a lack of competition in broadband markets is a major barrier to Internet access.
“People living in countries with consolidated broadband markets pay $3.42 more per GB of mobile data than those in similar countries with competitive markets,” the report stated.
“When people have no option to switch providers, they are likely to pay inflated prices for mobile data.”
The research estimates that 1GB data in a monopoly mobile market could be as much as USD $7.33 more expensive than if it were a two-operator market.
What should be done to make mobile data cheaper
The Alliance for Affordable Internet said if governments take steps to increase market competition, they can dramatically boost the number of people able to access the internet.
It called on governments to focus their policies and regulations on building healthy broadband markets by:
- Adopting policy and regulation that support market competition, including fair rules for market entry and incentives to encourage new competitors.
- Bringing down costs for new operators to compete by supporting affordable access to wholesale internet data, so that competitors aren’t locked out by high capital barriers to entry.
- Investing in public internet access, such as free public WiFi and telecentres, and support community networks.
“A failure to build and sustain competitive markets will push up broadband prices and undermine efforts to get everyone online,” the Alliance said.
Affordability Drivers Index
The report included an Affordability Drivers Index (ADI), which is an assessment of the drivers of Internet affordability in various countries.
The ADI covers 61 countries and focuses on two key aspects driving affordability: communications infrastructure and access.
South Africa is ranked 23rd with a score of 59.72, dropping four places over the last year.