CompCom, MTN finally agree #DataMustFall

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MTN SA CEO Godfrey Motsa.
MTN SA CEO Godfrey Motsa.

The Competition Commission (CompCom) and MTN SA have finally wrapped up discussions on data cost reduction.

The competition watchdog announced this morning that the parties have reached an agreement.

The CompCom has since referred the deal to the Competition Tribunal for confirmation as a consent agreement reached with MTN.

In December, the CompCom recommended MTN and Vodacom reduce their mobile data pricing by half.

MTN and the CompCom had been involved in merry-go-round tense discussions over the cost of data.

In March, MTN announced data price cuts but without the blessings of the competition watchdog.

At the time, MTN said its monthly bundles of 1GB and below will decrease by between 25% and 50% and the 1GB monthly bundle will decrease by 33% to R99.

But the CompCom almost immediately responded there was no agreement between the parties and any failure “to adhere recommendations is a sticking point”.

Today, the CompCom announced the two parties had finally found each other.

In terms of the agreement, MTN undertook to reduce the price of 30-day prepaid bundles up to 1GB, with the 1GB monthly bundle being reduced to R99.

MTN has agreed to implement retail price reductions across all its retail channels from 1 May.

“MTN shall communicate these reductions to all channel partners in April 2020 and will endeavour to apply these price reductions across all MTN channels from 1 May 2020,” reads a statement from the CompCom.

It adds: “MTN shall offer all its customers a daily free data bundle to use in Ayoba, which shall be capped at 20MB per day.”

The commission notes MTN revealed it implemented the daily lifeline package in respect of the Ayoba chat, media and channels functionalities on 12 March, and is still to implement the Ayoba browser functionality following this consent agreement.

The parties also agreed that with effect from May, MTN shall offer all its customers zero-rated access to certain public benefit organisations and other Web sites, subject to a maximum of 500 Web sites, focusing on education, healthcare and job recruitment via MTN's own Web site.

The CompCom says this shall be capped at 500MB per month per customer and be subject to terms and conditions.

Competition commissioner Tembinkosi Bonakele.
Competition commissioner Tembinkosi Bonakele.

Furthermore, MTN shall enable all its customers, at no charge, to manage their data usage through an MTN USSD and on the Web site.

Commenting on the deal, competition commissioner Tembinkosi Bonakele says: “The confirmation of the agreement with MTN means all mobile operators have now formally ascribed to the voluntary commitments contained in the recommendations of the Data Market Inquiry for short-term price relief to consumers.

“This successful conclusion of the first phase of recommendations could not have come at a better time given the greater reliance the public has on data during the crisis. The commission can now turn to focus on the medium-term recommendations around regulatory and legislative change, as well as the development of free public WiFi and alternative broadband infrastructure.”

MTN SA CEO Godfrey Motsa welcomed the deal, saying: “We are pleased to have reached this agreement with the Competition Commission, as it is a further social commitment that MTN will continue to advance the significant measures already implemented over the past number of years, to drive financial inclusion and reduce data prices.”

According to Motsa, MTN will continue to build on the initiatives already announced to ensure more people in all areas across the country can enjoy the benefits of a modern, connected life on the network.

The commission has already reached agreements on data prices with Vodacom, Telkom and Cell C, subsequent to the publication of the data market inquiry report.

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