Unintended consequences of data bundle regulation

Attempts by ICASA to regulate the prices and expiry dates of mobile data bundles may hurt the poor, not help them.

This is according to the head of Telkom’s consumer and mobile division, Attila Vitai, and the CEO of MTN South Africa, Godfrey Motsa.

ICASA’s second draft of its amended End-User and Subscriber Service Charter aims to do away with the concept of daily, weekly, or monthly data bundles.

In its first draft, ICASA proposed a minimum data bundle validity period of 10 days for 1MB–50MB bundles.

In its second draft, however, it raised this to a minimum expiry period of three years.

Impact on bundles

Vitai told MyBroadband that such regulations could affect its FreeMe bundles, which offer value-added services on the basis of month-to-month validity.

Telkom’s FreeMe Bundles include free WhatsApp usage, with a 500MB fair use limit on prepaid and 2GB on contract. It also includes free Telkom-to-Telkom calls.

With the introduction of LIT Music and LIT Video, certain FreeMe contract packages also include free data for media streaming.

If ICASA decides to regulate how long bundles must be valid for, it may compromise Telkom’s ability to offer its FreeMe bundles in their current form, said Vitai.

Motsa told MyBroadband that their weekly data bundles, which expire after seven days, are their best-selling bundles.

Motsa said they believe their weekly bundles are popular because many people get paid per week.

“A day bundle is too short for them, but a month too long,” he said.

Should ICASA ban these types of bundles, it will block a large portion of consumers from buying them.

Vodacom offered a similar warning, saying that ICASA’s proposed regulations would dramatically limit consumer choice.

The majority of the data bundles it sold in 2017 were smaller and micro-bundles, including its daily and weekly offers.

Vodacom suggested an analysis of customer behaviour is needed before making a final decision on data bundles.

Now read: #SocialMediaBlackout had no impact on data traffic or bundle purchases – MTN

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Unintended consequences of data bundle regulation