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The Federation of Unions of South Africa (FEDUSA) has welcomed the deal reached by the Competition Commission and mobile voice and data operator which will result in substantial reduction in monthly data bundle prices estimated at 34% of current costs from 1 April 2020. For example, analysts estimate that 1GB data bundles currently retailing at R149 will be reduced to about R99 a month when the new price regime comes into effect from the beginning of next month.

FEDUSA believes the move will go a long way in helping working class communities to increase their disposable income and increase access to the internet, at a time when digitization is rapidly affecting all facets of life, especially education and work processes. The deal is definitely not the result of benevolence by Vodacom but came about because of civil society pressure, of which, FEDUSA added its voice of displeasure, and saw the launch of a data market inquiry in 2017. The findings of the report released at the end of last year recommended that the operators reduce prices or face prosecution.

The union federation also wants the state to assist in driving the prices down even further by fast tracking the distribution of the spectrum – the visible portion of electro-magnetic wave, that enables mobile service providers to transmit voice and data over distance. The lack of spectrum is the justification why major mobile operators such as Vodacom and MTN, have consistently cited, for maintaining relatively high services costs in South Africa compared to other African jurisdictions in which they operate such as Mozambique, Ghana and Nigeria.

The release of the spectrum is also part of the 2018 Presidential Jobs Summit commitments to create jobs on a decent scale under the auspices of the tripartite  National Economic Development and Labour Council (NEDLAC), of which FEDUSA is an active participant in campaigns that have seen  ICASA (the Independent Communications Authority of South Africa), the communications industry regulator, prompted to pledge to start a distribution process by auctioning spectrum both for 4G and 5G frequencies in the latter part of this year. The multi – year substantial reduction of data bundles, which FEDUSA believes is long overdue, must be used as vehicle to drive South Africa’s regional and global competitiveness, to ensure that the aspirations of skilling, innovation, Big Data, coding, robotics and AI can be driven with greater urgency in a move to catalyse, unblock and reignite South Africa’s economic growth prospects.      

Issued by The Federation of Unions of South Africa