FEDUSA Welcomes Findings of the Competition Commission Data Services Market Inquiry
4 December 2019
The Federation of Unions of South Africa (FEDUSA) has welcomed the far-reaching findings of the Competition Commission’s Data Services Market Inquiry and called on cellular phone operators Vodacom and MTN to implement them with immediate effect. The inquiry which focused ondata prices charged by the two operators which dominate the South Africa cellular phone market; and initiated by the Commission in August 2017, not only found that South African data services were exceedingly high compared to other countries; but also that the costs that Vodacom and MTN charged its local customers were higher than those that it charged its customers in other African markets that it operated in.
In addition, and perhaps more importantly, the Commission found that the two operators’ pricing structure is anti-poor and lacked transparency: “Poorer, low-volume customers face higher per MB (megabyte) prices than richer, high-volume consumers on a like-for-like basis… and are faced with little option but to resort to purchasing short-validity bundles in pursuit of lower prices; but this is not answer as it does not provide them with continual data access at affordable prices,” the Commission said in a statement.
However, FEDUSA also believes that the state’s failure to release high demand electro-magnetic spectrum as a result of long delays in implementing speedy migration from analogue to digital technology has triggered an artificial scarcity in low frequency bands; and contributed to driving up costs unnecessarily. Through NEDLAC (the National Economic Development and Labour Council), and flowing from the Jobs Summit Framework Agreement of 2018, the union federation has been a key actor in organized labour’s demand for lower data costs which resulted in the state issuing a policy directive to ICASA last month to publish an open Information Memorandum spelling out potential spectrum assignment criteria that closes at the end of January 2020.
“Metropolitan Councils, district and local municipalities also need to start thinking about allocating budgetary resources needed to roll-out Wi-Fi infrastructure in their areas in order to support township and rural economic development; educational institutions and maximize opportunities offered by the 4th Industrial Revolution,” said FEDUSA Acting General Secretary, Riefdah Ajam.
This opportunity also extends possibilities to other South African enterprises, big and small, to gain greater traction in the growing gig economy as the demand for Big Data and the Internet of Things will allow faster enablers and adapters to growing innovation now that the playing fields of competitiveness have been levelled, concluded Ajam.
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FEDUSA Acting General Secretary
079 696 2625
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076 720 2640
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072 637 8096