Sunday, 15 January 2017

Econet and Mandiwanzira In An Ugly Brawl

Days after reversing extortionist government-approved mobile data charges by Econet Wireless, Information Communication Technology and Courier Services minister Supa Mandiwanzira is yet to know peace.

Mandiwanzira was hounded out of his holiday by angry Zimbabweans on social media after the country’s largest mobile phone operator by subscription, Econet Wireless, announced shocking mobile data charges that went up 25 times in a flash and he had to do the unprecedented by intervening, while Labour minister Prisca Mupfumira was holding fort at the ICT ministry.

The increase followed a Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) directive to mobile operators setting a floor price for data and voice calls. Potraz claimed the prices were proposed by mobile operators.

Mandiwanzira had to douse the fire after Zimbabweans besieged his Twitter account demanding an explanation, resulting in him announcing that the floor price had been suspended.

However, the minister courted Econet’s ire after he claimed that Strive Masiyiwa’s company was actually the one that proposed the new prices, adding that the telecommunications company had gone further than what government had prescribed.

Econet, in a stinging statement released late on Friday night, accused the minister of being dishonest after he claimed that he was not aware of the mobile operator’s “shockingly” high tariffs and accused the company of “gluttonous corporate greed”.

The mobile phone operator said problems started in July last year when Potraz refused to allow it to continue running its promotions that included free WiFi on prepaid data bundles, international bundles promotion, the SMS and win promotion. Econet said Potraz’s excuse was that it wanted to introduce a new framework.

The framework, Econet said, had been necessitated by government arguing that low data tariffs led to social media abuse.

“Liaison meetings between [the] operator and regulator followed. The regulator communicated its intention to fix a floor price for data and invited us to contribute to the determination of the floor price,” read part of the statement.

“We fully participated in this exercise and in good faith.

“Being the only operator that has paid the punitive licence fee of $137,5 million and being the only operator that is owed millions of dollars by government-owned competitors in respect of interconnection charges, our pricing structures are bound to be more expensive than those of our government-owned competitors.”

Econet said a regulatory notice number 3 of 2016 was issued on December 7 2016 and amended on December 29, and again on January 9 2017.

The notice set floor prices on data and voice and fixed a mandatory compliance date of January 9.

Econet said on January 9 it adjusted the tariffs when it became clear that Potraz was fully aware of the involvement of the ICT minister.

It said the tariffs were reversed after it became clear that there was a sinister plot behind the directive, which it alleges involved the minister.

“On January 12 2017, when it became clear that an exercise that was driven by the regulator with the full knowledge and participation of the minister and our competitors, who are under the minister’s control, to portray the new Potraz director general [Gift Kallisto Machengete] in bad light and portray Econet as gluttonous and insensitive to the public, our board directed us to reverse the data tariff increase,” Econet said.

The mobile operator said the new tariffs were only introduced at Mandiwanzira’s instigation and it now believes it was a ploy to set them on a collision course with Machengete.

Econet believes Mandiwanzira was trying to sabotage its business to help government-controlled Telecel and NetOne gain ground on the market.

“We wrote and delivered a letter to Potraz on January 12 2017 in which we indicated we would revert to our old tariff increases if the regulator did not ensure that all operators complied with its regulatory notice by end of January 12 2017,” Econet added.

“To anticipate our reversal of the date tariff increases, the minister, who is supposed to be on leave, published a notice in the press in which he claimed to reverse the data tariff increases.

“Our reversal to the tariff increases followed a directive of the board.

“The duplicity by the minister is intended to discredit us in the eyes of our customers and in the eyes of the public and to also portray the new director general of Potraz as incompetent.”

Econet accused Mandiwanzira of killing the mobile phone business through his alleged duplicity, imploring government to act with speed to avert the collapse of the critical sector.

“We urge the government of Zimbabwe to move decisively against the capture of this all-important industry by an individual who has such inconsistency and duplicity,” Econet said.

“Since his appointment to this ministry, he has behaved as if he is the minister of the government-owned entities alone and has been relentlessly attacking us without just cause and reversing the gains that this sector has made over the years.”

Meanwhile, Mandiwanzira escalated the war of words yesterday, accusing Econet of politicking and insisted that the company was behind the unreasonable tariff hike.

“I have noted a public statement by Econet Wireless which is highly political and defamatory,” he said in a statement.

“The political undertones of the statement, which takes a dig at the ministry of ICT, Postal and Courier Services and myself are alarming.

“I urge the company to stay away from politics and stick [to]its core mandate of business.

“Rather than attack the minister and the government, it is advisable that Econet should address concerns by their subscribers who are and have been losing money through seemingly fraudulent billing that makes data credit disappear even when susbcribers have not used it.

“These complaints have come to my office, Potraz and are widely shared on social media.”

The minister claimed that Econet’s top management had visited his offices on several occasions trying to persuade him to ignore proposals to reduce tariffs because it would threaten the existence of the business.

He said Econet wanted the tariffs to be increased because it said it was under pressure to service its loans with unnamed European bankers.

According to the now suspended new tariffs that had been effected on January 11, the cheapest bundle of data (5MB on a standard connection plus another 5MB available on WiFi) cost 50 cents.

For 10MB plus the bonus WiFi 10MB it would have cost $4, while the highest amount of data one can get (2.5GB plus 2.5GB bonus on WiFi) was pegged at $50.

Social media bundles for Whatsapp and Facebook that have been the cheapest avenue for partial internet access had also gone up and would have been based on usage rather than daily, weekly or monthly flat charges.

The cheapest bundle was also set at 50 cents and it came with 10MB of data plus a 10MB bonus.

For $2,50 (which is close to what subscribers used to pay for a month’s access) one would get 80MB plus an extra 80MB on WiFi.
Econet and Mandiwanzira In An Ugly Brawl
Source: Standard
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