Competition Tribunal accepts Vodacom’s data price cuts

The Competition Tribunal has upheld the agreement between Vodacom and the Competition Commission regarding the reduction of data prices.

The agreement follows the publication of the final report of the Data Services Market Inquiry in December last year.

The Commission implemented the inquiry to investigate factors or features of the market that have historically led to what it labels as “high prices for data services”.

The Tribunal’s confirmation means that it has accepted Vodacom’s proposed changes and that the consent agreement between Vodacom and the Competition Commission is now officially entered into.

The agreement includes the following:

• Significant details to retail data prices – including the reduction of data prices by over 30% across all channels effective as of 1 April 2020.
• Lifeline and zero-rated data made available through the ConnectU platform.
• Personalised discounts to prepaid customers in all areas where the majority of the population has income below the upper bound of the food poverty line.
• Improve transparency regarding personalised price promotions, which will always be better value than headline offers.

Need for spectrum

Speaking at the Competition Commission media briefing, Vodacom CEO Shameel Joosub said that data prices would be decreased again on 1 April 2021, resulting in a total data price decrease of around 40%.

“Following the release of the Data Service Market Inquiry report, Vodacom decided that instead of fighting with the Commission, it would engage constructively with the issues raised in the report,” Joosub said.

However, Joosub added that a lack of available spectrum remains a serious challenge for mobile operators in South Africa.

Vodacom hopes for high-demand spectrum to be allocated this year to help mobile operators improve network quality and reduce data prices.

“We make this move proactively in the hope that spectrum will be allocated this year,” he said.

“The spectrum delays do not affect the agreements that have been made. The trust factor for Vodacom is ‘drop the prices and spectrum will come’.”

Now read: How networks will use cellphone location data to stop the spread of the coronavirus