Econet, Telecel, NetOne ordered by POTRAZ to slash mobile voice tariffs

Posted by
Sibo Muteyiwa POTRAZ

A POTRAZ official moderates a POTRAZ consultative workshop on Telecoms Consumer Protection earlier this year.

Zimbabwean mobile operators, Econet, Telecel and NetOne have been ordered by the telecoms regulator, POTRAZ, to slash mobile voice tariffs from the current US 23 cents per minute to 15 cents. According to a report in The Source, the directive was issued on 16 October this week and MNOs have been told to effect this in December.

The tariff reduction  directive is part of POTRAZ’s implementation of a new pricing model called the Long Run Incremental Cost (LRIC) model presented in June this year. Operators are already finding it hard to maintain their revenues high as alternatives to voice communication, like WhatsApp and Facebook are increasingly accessible to more, and are used more, by consumers. The tariff reduction will worsen the situation for them. Revenue from data service hasn’t exactly compensated yet for the reduction in voice.

According to the report, the POTRAZ has directed that the tariffs be further adjusted to 12 cents per minute in 2015, and then 9 cents in 2016. The interconnection rate, which has been 7 cents for several years will also be reduced to 5 cents in December, and then 4 cents in 2015 and then 3 cents by 2016.

The reduction, has apparently been effected by POTRAZ as a response to an outcry from customers who feel the tariffs are too high. The 23 cents per minute tariffs have essentially been the same since about 2009.

What do you think? Is this low enough for you to start making more calls?

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28 Comments

  1. PN says:

    its a start, it makes me want to call yes, what of data? On revenues yes some operators are struggling but not all. The struggling ones need to play ball and not just sit there with nothing to offer.

    1. You reckon Econet has a great working model on those bundles?

  2. REWMO says:

    its still too high. they are robbing people.

  3. firefox says:

    i hope that will encourage people to start using voice once again,but i wonder if that will be enough for people to move away from whatsapp coz voice has always been better than text? but in this age in which data is becoming more relevant coz of internet usage through computers and mobile devices they should also consider a slash in data charges.

  4. Galvatron says:

    Still we have airtime tax, so the value of the airtime will be less more

    1. Anonymous says:

      Less More indeed Galvatron

  5. Rangarirai says:

    What of the data tarrifs?

  6. wezhira says:

    Data rates are way too expensive compared to other service providers in the world. Recently i was in Asia and paying $4.63 for 2GB of data per month

    1. Anonymous says:

      Which Asian country is offering those rates and which network where you using? Just curious.Kinda too low for 2G in Asia.

      1. African cristiano says:

        I’m a Zimbabwean studying in India and I can assure you that Wezhira is telling the truth. From one of the companies called Bharti Airtel you can pay INRs.955 which is about US$15 for 7Gigabytes of data at 3G speeds!!

  7. ini zii hangu says:

    wat about airtime tax

    1. Anonymous says:

      what about it

  8. Ibold says:

    Our rates are probably the highest in the world. Thats why their voice revenues are down. I’ve just returned from UK – For £15 / or $24 I got a package of 300 minutes calling any network any time 3000 sms and UNLIMITED 4G data Valid for 30 Days. How on earth can the local networks charge such crazy amounts in Zim. PORTRAZ needs to move FAST to get things back to NORMAL…..

  9. Perceptor says:

    Well, I’m certainly not gonna complain about cheaper rates, but lets not forget about the economies of scale at work in Zimbabwe. While business is business, Portraz needs to be sure they don’t end up pushing the industry beyond what the market can sustain.

  10. Anonymous says:

    as much as we want cheaper rates, i agree with Perceptor, Zimbabwe is not UK nor is Asia in Africa. There are too many things at play especially when it comes to data. In the world Asia is generally cheaper wen it comes to data and is also the fastest in terms of downloads. Econet, Telecel and Netone needs to stay in business for them to survive otherwise more employees will be retrenched and so forth

    1. tinm@n says:

      That’s a hard fact that I would have to agree with too. The only network that won’t suffer that much is Econet because of its user base and wider diversity.Netone is the next safest one as it is state run and less profit oriented. Telecel will bear the greatest brunt because it lacks the advantages that the other two have.

      All networks really have to think on their feet and should focus more on volumes than margins per (user base) capita.

      And they should be more open to valid models that wish to utilise VAS over their networks. The payment space is possibly one that can provide a stream of revenue.

  11. caleb says:

    Creative destruction!

  12. Maxwell Christian says:

    Also the mobile money transfer tariffs need to be looked at as they are on the extortive side. POTRAZ or RBZ or both and more need to look into this issue rather than sleep on the wheel. Can’t the Competition & Tariff Commission intervene in the impasse between Econet & BAZ as Econet is behaving bullishly and not wanting to open their network to them and asking for exorbitant fees?

    The implementation date for the voice tariff reduction is too way far into the future and it should at least have been the legislated 2 weeks w.e.f. not later than 1 November 2014.

    On a separate note, POTRAZ seem to have directed the MNOs to prepare themselves for the introduction of NUMBER PORTABILITY next year or so, which allows users to change from one MNO to another without changing their present mobile number.

    With mobile number portability, do you get to move along to the next MNO with the previous MNO’s prefix or what you only get to retain is your last 6 digits?

    If you get to move along with the 4 figure prefix, e.g. 0772 / 0734 or 0712 (and their respective variants), then how does someone else other than the owner know the true home of the mobile number if for instance you want to take advantage of intra network promotions?

    1. ini zii hangu says:

      Econet is not bullying any one, why do you nee a cheaper service from a competitor, if you are a begger you dont put your terms and conditions.

      Banks have a choice either go toTELECEL NETONE,

      How come you dont complain that zimswitch is expensive , they increaced their charges wani

      ini zii hangu

  13. SirDownloadAlot says:

    ZOL voip is cheaper at:
    Calling 086777 FREE
    Any Other Zim Number 0.12
    Group 1 0.27
    Group 2 0.21
    Group 3 0.14
    Group 4 0.37

    However, it hardly works….. LOL

    1. fourwallsinaroom says:

      sign me up times two. free calling to my spouse perfect.

      1. fourwallsinaroom says:

        I also like that i can finally keep my imarsat active by making a cheap call….

    2. aviel says:

      Have been using the 08677…….. line at the office for some time now and our telephone bill has gone down by 30%, its always available and we not having any troubles at all.

    3. African cristiano says:

      What is this?

  14. Naison Makasu says:

    POTRAZ is to cut these tariffs further if its is for the people since it is a government arm.Further more POTRAZ must cut access fees on VSATs ,then us in the know on providing competitive solutions will teach the capitalist and profiteering business a lesson or two.

  15. zimictfan says:

    I hope POTRAZ considered that in Zimbabwe unlike other countries MNOs are the number 1 consumers of diesel, duty on equipment is high, transportation of equipment from boarders is high since we are landlocked, skills are very expensive especially for new technologies etc. In 5-10 years time MNOs may be utilities like ZESA there will be no money in this business! QoS is definitely going to be low under such a tariff. I know we are all happy with tariff reduction but we will be complaining soon and MNOs will argue about financial viability. Some MNOs like Telecel will be closing soon! If I were an MNO there are certain areas where I will not deploy Base Stations because they are loss making base stations (profit per base station is negative). Potraz must use the USF to deploy base stations in low profit regions because there might be no MNO investing in those areas soon! Some legacy technologies will be discontinued eg. GSM (2G), GPRS. LTE cost per MB is more affordable and it would be beneficial to setup such networks but with OTTs another challenge is looming. Interesting times! In most markets the trend is such that the dominant MNO is the one making sweet profits the rest are tending towards history. We will see this happening in Zim soon! Econet seems to be well positioned at this moment in time!

  16. African cristiano says:

    This is without question and beyond doubt a good start, Thank You POTRAZ!!

  17. KT50 says:

    Guys, today marks the 20th day past December 1st, the day you claimed mnos were to adopt potraz directive on mobile tariff reduction/slash. How come I SEE no changes in the billing, HEAR no explanations from you, nor TALK @ $0.15/min on my mobile?

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