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South Africa follows Ghana, Nigeria with promise to cut data costs

South Africa follows Ghana, Nigeria with promise to cut data costs

The promise by South African president Jacob Zuma last week during his State of the Nation Address (SONA 2017) that the government is looking at ways to reduce the cost of data packages adds to a growing number of countries on the continent that have announced their intention to lower data prices. Nigeria and Ghana have already vowed to take similar action, while steps to increase costs have since been reversed in Zimbabwe following public outcry.

Zuma told parliamentarians and South Africans watching his televised address that the government will slash costs. "We assure the youth that the lowering of the cost of data is uppermost in our policies and plans," he said.

A few weeks before the South African leader's commitment, Arch. Sunday Echono, Permanent Secretary for Nigeria's Minister of Communications Adebayo Shittu made the same undertaking.

He publically endorsed the affordability target determined by the Alliance for Affordable Internet (A4AI) in a speech delivered on behalf of the Minister during the A4AI-Nigeria Coalition meeting.

"Consequently, A4AI and the Ministry share the common goal to make the Internet universally affordable for all who want to use it. This goal is quantified in a measure of having 1 Gigabyte of bandwidth not costing more than 2% of a person's monthly income," declared Echono.

At around the same time, Ghana's Minister-designate for Communication Ursula Owusu-Ekuful said the incoming government of that country will actively engage local ISPs to lower the cost of data.

"We will work with the sector operators, the data broadband wireless operators, and mobile network operators themselves to see what we can do where we can derive the synergies which will help drive the cost down." pledged Owusu-Ekuful.

Analysts have however warned governments to be more prudent in their efforts to drive cost down.

Professor Njuguna S. Ndung'u, Kenyan economist and former Governor of the Central Bank of Kenya appealed to Africa's regulators to exercise good judgment earlier in the year as part of a report by the Brookings Africa Growth Initiative.

Ndung'u warns that the lessons are clear that a poor regulatory environment can be a major obstacle to innovations in the market.

""A regulatory approach and a regulatory environment that will encourage innovation and entrepreneurship is what African economies should strive to achieve in 2017 but also work on the pitfalls that can disrupt the process that will kill innovativeness and broad-based growth across sectors."

A botched attempt to increase data costs saw the government of Zimbabwe backtrack on its attempt to hike data tariffs earlier this month. The country's ICT Minister Supa Mandiwanzira and the telecoms industry regulator, the Posts and Telecommunications Regulatory Authority of Zimbabwe (Potraz) had claimed that the increase of mobile data prices was a measure taken to protect mobile operators from Over the Top (OTT) applications that it is claimed continue to erode revenue prospects.

Brian Mutandiro, NetOne CEO told a parliamentary committee that the new prices, which have subsequently been reversed, would have had have impacted negatively on operators.

"As a network we are very relieved that the floor prices were reversed," said Mutandiro.

The trend to reduce data costs is not going to be consistent across the continent according to non-profit think tank Research ICT Africa, which has urged the ICT sector to 'look out' as "we might be seeing a trend of price increase on data on the continent...," following the bungling in Zimbabwe.

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