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Zim mobile firms aim for profit

By Vanessa Haarhoff, ITWeb African correspondent
Johannesburg, 02 Feb 2007

Zimbabwe's mobile telecommunication operators Econet, Netone and Telecel are lobbying for more "realistic" cellular network tariffs.

The country's mobile operators argue that cellular tariffs are too low when compared with the hyperinflation in Zimbabwe.

"Unrealistic mobile call tariffs allow subscribers to talk for long periods of time, creating congestion, as well as loss of company revenues," says Reward Kangai, CEO of Netone.

He says the Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) is not matching tariff charges with inflation. Potraz was unable to comment this morning.

Kangai explains that Zimbabwe follows the International Telecommunication Union's COSITU tariff calculation model. The model calculates telephone charges, interconnection fees and tariff charges.

"This model can no longer be applied to the Zimbabwean telecommunications landscape as the model is not designed to keep up with 1 200% inflation."

Econet spokesman Sure Kamhunga says Zimbabwean cellular tariffs are some of the cheapest, if not the cheapest, in the region in US dollar terms.

Proof of congestion

Earlier this week, representatives from Zimbabwe's cellular operators met with the Parliamentary Portfolio Committee on Transport and Communications to present proof of network congestion due to low-cost tariff charges.

"We need policymakers to implement policy that will match tariff rates with the hyperinflation situation," says Kangai. "Parliamentarians have been slow to react."

Econet believes that with continued lobbying, progress could be achieved.

Operators continue to engage the regulator to award viable tariffs that provide a return on investment, Kamhunga says. "They need to enable the operators to invest more to expand services, as well as provide an acceptable grade of service to customers."

Both Econet and Netone have upgraded and expanded their networks in the last year. "With a more streamlined cellular tariff call system, Zimbabwean cellular providers would save a lot of money that could be directed towards upgrading their networks," Kangai says.

John Robertson, a Zimbabwean economist, explains it is difficult for mobile operators to increase revenues and upgrade network facilities under the current tariff call system.

"Many companies are operating in the parallel market which is 20 times more expensive than the official rate of local income revenues."

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