Releasing some music online recently made me realise there is an opportunity to service those who, due to the cost of data bundles are unable to participate in the digital world by clicking on the link and streaming on the release day because, “amaData awekho” as a family member commented. It is a world of calculated, and carefully rationed usage of this new commodity called “Data bundles” which allow access to online content through mobile internet service providers. I wondered about about what this “data” could be, and how it’s value is calculated. I had heard of data mining, but doubt this is the same “data” that is said to be the thing that allows access to the internet as south Africans have come to understand. What is the raw material of this data, that we buy in bundles, does it have mass, is packaged in order to be resold to us… how much are the direct costs to produce it, and how much of that does the consumer end up paying for.
#DataMustFall as sustained campaign and effort came and went, the masses seemed to organise online, celebrities joined the protest against high data prices, Vodacom was shamed, for its moral bankruptcy linked to it circumventing regulatory obligations by proposing a “tax” on customers who benefit from Data bundle not expiring on a monthly basis… an attempt to profit by any means. I remember in February 2018, Minister of Economic Development Ebrahim Patel made promises that government would prioritise bringing down data costs as part of developing an economy in line with “the Fourth Industrial Revolution”. Its a good thing to know, politicians have been proved to be only using the “fourth industrial revolution” as a catchphrase and means to appear relevant but without understanding the implications of this. There is a necessary acknowledgement — that access to information and communication technology (ICT) today determines the lifestyle and general well-being of citizens — this is a critical observation, and requires the intervention of regulators to ensure that universal access to broadband services, as prescribed by the United Nations Human Rights, is achieved for, I dare say, “a better life for all”.
In my time at a prominent weekly newspaper, I took on an assignment involving some research on telecommunications regulation. It was around this time the Independent Communications Authority of South Africa (Icasa) hosted a debate at the Maslow Hotel in Sandton on Wednesday, March 14, 2018. The debate, moderated by award-winning journalist Iman Rappetti, was meant to address core issues and come up with possible answers to the question, “Why are we paying so much for data?”
A panel of five individuals who had an interest in the #DataMustFall debate was compiled to answer the question. Professor Babu Sena Paul from the University of Johannesburg included in his opening remarks the example of Jio, a mobile operator in India with a market proposition of free data. “Data can be free,” said Paul. His sentiments were supported by Indra de Lanerolle, a media and communication researcher and consultant from the University of Witswatersrand’s Journalism Department. He said: “We pay so much because mobile network operators are choosing to charge these prices.” You can actually stop reading now, and think about how prices are being determined without reasonable justification and transparency, with no intent to find a solution that doesn’t compromise access for the poor either. Smell like Conspiracy.
Koketso Moeti is the Executive Director of Amandla.mobi, a movement of 203 786 people taking action to build a more just and people-powered South Africa. As part of the panel, Her anecdotes brought to light the plight of the poor regarding access to data. Her organised movement is working to turn every cell phone into a tool that entrenches democratic principles, so that those most affected by injustice, especially black women and low-income communities, can mobilise in large numbers to challenge those in power.
South Africa’s cellphone penetration remains the highest in Africa. Mobile research group GSMA Intelligence released a 2016 report claiming that South Africa then had 37.5 million unique mobile subscribers, a 68% penetration rate, compared to Nigeria’s 86 million mobile subscribers, representing 45% of the population. 3 years later, according to ICASA , South Africa’s smartphone penetration increased from 81.7% in 2018 to 91.2% in 2019. Yet, even with increased volumes to service, and extract profit from, regulatory bodies such as Icasa and mobile operators are bound by a legislative and regulatory framework that doesn’t offer incentives for mobile operators to drop prices, Icasa chief executive Willington Ngwepe noted.
Loren Michelle Braithwaite-Kabosha, Chairperson of the South African Communications Forum, a representative body of the ICT industry encompassing the telecommunications, electronics, IT and broadcasting sector. As a former Chief Executive of a company that rolled out telecommunications infrastructure throughout the African continent, she at the time was well aware of the input costs involved in the setup of a telecommunications network.
She believes data costs should fall, but a detailed analysis of costs along the value chain should be considered when determining the pricing of product offerings from mobile operators. Over the years since this debate, There have been downward trends in the price of data, dropping as much as 45% according to some research, but Still the mumbled expressions of discontent from consumers on social media indicates that this is not enough.
The big industry players claim that access to high demand spectrum will allow more mobile operators to enter the market and create competition. Spectrum that is continuously being delayed for the longest time was released during Covid 19 Lockdown, to allow for the increased internet demand. It could be argued that competition doesn’t always translate into benefits for the consumer and this would be something to guard against. New players such as the Data only Mobile operator, Rain have disrupted this market by offering remarkable packages of unlimited data for R250 ($18) a month except during its peak hours of 6pm to 11pm. All other data costs R50 ($3,60) per gigabyte, and it never expires and doesn’t require a contract. Yet the major service providers, still remain at a premium charge…
This is significant in South Africa where data costs are not only high but linked to contracts, Forbe’s magazine once noted, “These bundles” expire at the end of a month, while pricing for packages is often opaque. REcently (2019), Legislation from the regulator, Icasa, who regulates in the interest of the public, obliges all operators to roll over data to following months…
Icasa as the communications regulator of South Africa also has the duty to issue licences to compliant persons and companies looking to access spectrum for mobile and broadcasting. Ngwepe noted that in excess of 300 licensees have been granted licenses to operate in the mobile market, but issues relating to the release of state-owned spectrum have prevented the release of additional spectrum since 2003. Other issues relate to the availability of infrastructure for the new licensees to utilise. One proposition from the audience was for policy and regulation to compel mobile operators who already own infrastructure to share that infrastructure with burgeoning mobile operators. In order for this possibility to occur, technical and economic feasibility assessments will need to be undertaken by the communications regulator, but this costs time and money.
Punishing the poor
South Africa is plagued by huge economic disparity: the Gini coefficient rates South Africa as one of the most unequal societies. The poorest of the poor, who urgently need access to data to change their circumstances, are the ones most affected by high data costs. Basically, the more data one can afford to buy, lessens the “per megabyte” rate which the service costs. This is a serpentine economic model designed to increase profits by increasing the volume of cheaper packages at a higher per megabyte rate. Ultimately punishing the poor, and working class without justification.
At the debate, a representative from Vodacom spoke of how in the past a large number of their subscribers had moved from monthly data packages to the daily packages, which according to economies of scale is more expensive than buying a 5kg sack of maize meal per day. But there are packaging costs involved in the fast-moving consumer goods market that sell maize, that justify economies of scale. The packaging costs do not necessarily exist in the “packaging” of data bundles, so where is the justice I remember Iman Noting, while questioning the moral indifference of the mobile operators.
Public participation and pressure seem to be the only way that consumers will obtain justice. South Africa has regulatory institutions such as the Competition Commission and industry specific regulators such as Icasa. Every so often, public participation is sought to bring amendments to existing regulatory frameworks, but of all the stakeholders, the ITC industry is the most active and it submits proposals that benefit consumers only slightly, without compromising their profits.
Amandla.mobi encourages public participation through engagement and the use of petitions to educate the public about their rights. Mobile operators built their business models based upon profit before people and they need to be taught how to adjust to our changing world, where access to data is a basic human right, stressed De Lanerolle. Data has become a utility much like water and electricity, which are subsidised by government; the question becomes, is a similar model necessary to address the issue of access to data, and the digital divide? And the answer is yes, but consumers need to participate, and mobile networks need to report to parent companies that invested in the current infrastructure in search of profits… and so regulation, in the poor public’s interest is the only way in societies founded upon the segregation of the working calss from value-rich economic participation and exploitation of the physical and monetary energy of the poor.
Amended End-user and Subscriber Service Charter
Icasa’s now concluded End-user and Subscriber Service Charter seeks to address the major issues related to transparency, expiration of data and the high price of out-of-bundle rates. The regulations, adopted after march 2019 translate into new rules of engagement governing telecommunications and changes relating to the expiration of data bundles amongst other changes.
At the event, the panellists, having contributed to the charter, still saw loopholes in it that do not address the issue of data pricing punishing the poor. The charter was premised on the identification of primary markets, that Icasa identified as requiring intervention with regards to transparency and pricing. The transparency will aid in empowering the consumer to make informed decisions, such as being notified at regular intervals of the amount of data bundles available and the option to opt-out for out-of-bundle pricing. The expiration of data was initially proposed to be extended to a period of three years, but the poor, at least for now, remain with the desire to have enough data to last them just for today.
This is true, in a year we were confined to our homes during a #Lockdown designed to isolate humans in an effort to minimise the spread of a coronavirus. Mobile Network providers were the intermediary facilitating a very basic need which is connection and interaction… but at an unfair, mostly unjustifiable cost. And this is the nub of the matter: that policy sometimes disregards the needs of the poor, and myself a writer, whose answer to the question “why are we paying so much for data” is… There are various Publics, when regulators regulate in the public interests, the poor and working-class as a public within the public, hold very little stake in the pie of consideration in such matters. There are celebrity stakeholders who are offered the biggest pies of consideration, admittedly because of capital and formal, Organisation. There is a power value to be exploited by the Poor and Working class in their numbers, but this value is only unlocked from organising to the eventuality of Formal Organisation that can display why it deserves a majority of the pie of consideration… If there is any justice in the world.