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BREAKING NEWS: POTRAZ orders Econet to revert to 25 cents per minute

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econet_vs_potrazIn an interesting twist to the ongoing mobile tariff wars in Zimbabwe, POTRAZ we are told, has today directed Econet to revert to the old punitive pricing of 25 cents per minutes for calls. We just got the information right now from an Econet spokesperson. This is the first time POTRAZ has reacted publicly to the tariff wars.

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“POTRAZ has ordered Econet to revert to the 25 cents tariff, and stop offering the 10c tariff by 4PM today (Tuesday).” said the communication we got. The argument by POTRAZ, the spokeperson says, is that Econet cannot effect a tariff cut of above 50%.

Here’s a quote of the message from POTRAZ:

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“Given the foregoing, we hereby direct Econet to stop the implementation of the advertised tariffs with immediate effect and no further Buddie Zone advertisements should be flighted in any media issue or released after 4PM on Tuesday the 20th of August 2013.”

According to the communication from Econet, they have been told to comply by Friday or face penalties from the telecoms regulator.

We are not sure yet how this affects promos by other operators in the sector, like NetOne and Telecel, who by the way, are the main reason Econet made the move last week to cut off-net tariffs by as much as 60%. We will be finding out.

Reacting to the directive, Econet’s complained that while the regulator is is there to create a level playing field, they had not made any moves to stop other operators in this price war from dropping tariffs. Fingering out Telecel in the response, Econet said “Even when other operators violated key conditions of their license, we did not see any such threats being made. Now when we take steps to deliver affordable services to our own customers, we are barred. This leaves us wondering just how level our playing field really is,”

Econet also said that the 10 cents tariffs had been well received by the public, with usage having risen sharply since the tariff was effected. The company added that the move by POTRAZ would disadvantage millions of Econet customers who were already enjoying the heavily discounted call charges on Econet and to other networks.

Just this morning, we published an opinion on how the mobile tariff wars are killing VoIP providers in the country, who are already charging thin margins to compete reasonably with the incumbent mobile operators.

Update: We managed to get hold of POTRAZ Deputy director general, Alfred Marisa, who spoke to us on the POTRAZ position regarding this development. See the article here.


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63 thoughts on “BREAKING NEWS: POTRAZ orders Econet to revert to 25 cents per minute

  1. Econet reported and punished Telecel for fouting the Regulations rules. Telecel ammended their anomalys. Now Econet flouts their rules and Potraz punishes them – they cry. Econet wants to play Regulator. No no no – follow the rules guys and get ur promos running. We lovethem coz we win in the end. #TellSomeBUDDIE

  2. There are two possible explanations to this. Potraz earns 2% of all annual revenues raked in by MNOs. So Imagine Econet, the biggest player reducing their charges by 60% in a market where the demand has become inelastic due to whattsapp.. It was ok Telecel and Netone doing it because the impact was insignificant. Secondly, POTRAZ might have received a bashing from invisible hands for the slow reaction to the unfair treatment by Econet of Telecel hence they moved in too quickly this time without thinking that Econet was only responding to competition.

  3. I am smelling rats. Dead rats actually. Is this still business or Potraz has scores to settle on behalf of other entities that shall not be named? First, many people were on Econet’s throat when they blocked Telecel. Econet cited Telecel operating without a licence, a fact that went undisputed up to now, yet Potraz never uttered a word until Telecel re-licensed (with the help of some people who shall not be named – check the media). At this point people (me included) believed Econet could not price competitively so they resorted to bullying. There was even an Econet-bashing programme on Zifm Stereo a day or two after the blocking (because Econet wasn’t represented in that discussion and it was sooo one sided). Now that Econet has realised this is a pricing war, they stepped up and offered the better deal, Potraz objects. They object to lowered prices but they do not object to operating withou a license? somebody help me understand. Are they still a regulator or they have become an arm of some organisationcompany……. Is it still business or there are other non-business related forces that have business interests that are at play here?

  4. What telecel is offering is a bonus, unlike Econet that unilaterally changed
    the tariff with no consultation and permission with the regulator. it stinks, yes but at the end of the day we all have to follow the rules, biggest corporate or not.

  5. First of all find out who are the local owners of telecel, africom and telone, then you will know all the reasons. These are the same reasons why the world is scared bringing business investment to Zimbabwe. Politics. Econet owners are taken as enemies of Zanu pf, hence sabotage.

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