South African competition regulator orders data costs be reduced

South Africa’s competition regulatory authority on Monday revealed that mobile operators have been overcharging for internet connectivity, ordering top operators to drop prices within two months or face prosecution.

The high cost of data has in the past stirred public outrage prompting protests under the hashtag #DataMustFall as well as parliamentary hearings into the issue.

After more than two years of probing complaints from consumers about unaffordable data costs, the Competition commission of South Africa said findings showed that prices of data were “too high” in the country.

It said the larger operators — Vodacom and MTN — charged more for data services in South Africa than they did in other markets where they operated.

Calling on the large operators whom it said were “actively engaged in exploitative price discrimination and partitioning strategies in order to push up margins and prices,” to commit to price reductions, especially prepaid monthly bundles, within two months of the release of the report.

“There is scope for price reductions in the region of 30 to 50 percent,” the commission said in a statement.

Failure to make the necessary changes within specified timeframes would result in the Commission proceeding to prosecution under the appropriate sections of the Competition Act.

The commission was satisfied that there was a prima facie case for excessive pricing against Vodacom and MTN.