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Home » News » Business » Mobile broadband, voice price cuts

Mobile broadband, voice price cuts

Publishing Date : 10 July, 2017

Author : AUBREY LUTE

The Ministry of Transport and Communications, through Botswana Communications Regulatory Authority (BOCRA), has started implementing a Pricing Framework which seeks to align to cost, the retail prices for mobile voice and mobile broadband.


This is expected to lower the cost of doing business in Botswana and give consumers value for money. Implementation of the Framework has been phased over three years starting June 2017. The implementation has started with the removal of mobile Termination Rates and the removal of the difference in prices between the off-net premiums (between networks) and on-net (same network) rates.
 

According to the Ministry’s permanent secretary, Mr Kabelo Ebineng, the objective is to eliminate the off-net premiums to ensure that operators charge consumers the same tariffs for all calls between and within networks. He says BOCRA has been mandated to regulate prices for telecommunications/ICT services. Ebineng states that over the years, BOCRA has been conducting studies to determine the cost of providing services and the appropriate pricing levels. The principle is that prices must, to the extent possible, reflect the cost of providing service, he observes.
 

The permanent secretary at the Ministry notes that the outcome of the recent Cost and Pricing Study undertaken by BOCRA has revealed that the cost of doing business is high in general and in particular in providing telecommunications/ICT services in Botswana. “This is due to the fact that Botswana has a unique characteristic of a large land mass, relatively small population, is landlocked and almost all ICT equipment and solutions are imported,” he writes in a response to the Public Accounts Committee of Parliament.

 

Meanwhile the study further revealed that the cost of providing mobile broadband is significantly higher than the retail price that the consumers are being charged. It has also been established that the retail price for mobile voice is significantly higher than the cost of providing the service. The current pricing regime by mobile providers is such that prices for voice services are used to subsidize mobile broadband data cost.
 

Currently, mobile broadband bundled data prices range from P0.13 to P0.67 per megabyte depending on the type of package subscribed for. Out of bundle data prices range from P0.90 to P0 .99 per megabyte. In addition, the prices for fixed broadband (ADSL) charged by BTCL, which has the largest customer base, vary by speed.
 

According to Ebineng, in order to address some of the challenges, the Ministry has developed a Broadband Strategy with the overall vision to connect every citizen, business, community and the country to a high-speed broadband infrastructure at the appropriate quality of services and affordable prices. As part of the implementation of the strategy, initiatives have been put in place to address the issue of high tariffs, the permanent secretary said.


Ebineng further indicates that Government, through Botswana Fibre Networks (BoFinet, is deploying the national fibre backbone to connect villages to the telecommunications network; Government, again through BoFinet, is rolling out fibre to the premises (FTTx) in cities, towns, and some major villages.


Ebineng also shares that the rollout of the national fibre backbone and fibre to the premises are meant to reduce the burden of providing service by developing key national ICT infrastructure. This would be very expensive or prohibitive for individual operators to roll out themselves. “All operators are instead utilizing this infrastructure on open access and transparent principles all in an effort to promote universal access.” 


Recently the Public Accounts Committee had expressed concern that it was too expensive to do business in Botswana due to the cost of data. They had wanted to know the basic cost of data. The cost of doing Business in Botswana has been found to be dreadful by the World Bank Group. 

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