Survey finds Malawi’s telecoms costs exorbitant

By Gregory Gondwe, Blantyre, Malawi

Findings from a survey by Research ICT Solutions indicate that Malawi ranks amongst African countries with highest cost of making phone calls and Internet usage.

The announcement comes at a time when the Communication Regulatory Authorities of Southern Africa (Crasa) was meeting in Capital City Lilongwe to discuss new initiatives that will help bring down the cost of communication.

Research ICT Solutions has established that lack of competition on the market remains one major challenge affecting cost of communication.

The study, instituted by communication regulator, the Malawi Communication Regulatory Authority (Macra), was assessing and analysing market trends for electronic communication in the country.

“On average, costs of making calls are pegged at K72 per minute within the same network and K90 per minute between different networks,” said Lead researcher, Andrew Dymond who rated it as exorbitant when he made presentation of the findings this week.

He said the tariff rates have been so high on the regional basis, very high than other countries within the region and even the continent.

“This means that Malawians are paying more than what most other people are paying for similar services across the continent,” he said.

Dymond however, said the rates seem relatively low during off peak time and on same network calls owing to marketing incentives by service providers.

“By calling during off pick period, or on net calls, consumers have got a better price, a third or quarter lower than the actual prices,” said.

At its meeting in Lilongwe this week, Crasa’s legal and policy committee discussed what it calls the ‘roaming like home’ and the open access policies whose aim is to regulate roaming rates and charges incurred by countries when connecting to the sub marine fibre cables.

“The committee will be engaged in several issues of discussion to develop new policies and regulatory guidance for the region,” said Crasa Executive Secretary, Tony Chigaazira.

He added that among the issues they discussed is roaming processes, called ‘roam like at home’ where when one is roaming they should use the same line they use at home and the same rate with a small charge which is transparent.

He however acknowledged that for that to happen it requires policies and regulations, because the operators in different countries cannot agree if the regulators have not level playing field and this is the reason the committee is working out on those policies and regulations.

“On the issue of open access to submarine fiber cable is a critical issue which as a committee we are trying to address by coming up with policies to ensure that every country regardless that they are landlocked or along the shore have equal access to the cable,” he said.

Chigaazira recommended that there should be open access because currently the biggest cost of communication in accessing the information highway is not from the coast to the telehouse in America or London, but from Lilongwe to Beira landing port.

He, therefore, said the committee will come up with regulations and policies to control such charging to ensure fairness which will consequently effect on service charges by operators in the countries of the region.

However, he said the integration of the region to come up with harmonised regulations is challenged by different levels of regulatory environment but said the process is in progress.

One way of bringing down the cost according to the researcher from Research ICT Solutions is to increase the number of service providers to grow competition on the market.

Freedom House’s Freedom on the Net Report of 2014 for Malawi says according to statistics released in May 2013, there are 22 operational ISPs in Malawi, and despite high operating costs and the limited availability of international bandwidth, there is reasonable competition between the providers.

The report further states that Malawi’s two major players in mobile phone services, Airtel Malawi and Telecom Networks Malawi (TNM) and together command a mobile teledensity of 18 percent.

“A third mobile operator, G-Mobile, was licensed in 2008 but the rollout of the new network experienced delays. It is currently in court fighting against the revocation of its license as a result of a failure to start services on time,” says the report.

It further says the fourth license was awarded to Celcom in 2011, and although the launch of its services was expected in 2013 it has now asked Macra to extend its roll out period for another 3 years amidst licence revocation warning from Macra.

“There is more competition in the market with the introduction of a converged licensing regime, which enabled the country’s two fixed-line operators, MTL and Access Communications, to enter the mobile market,” the report states before adding: “Both telecoms are already operating CDMA-based fixed-wireless networks that support full mobility and broadband access using high-speed EVDO technology.”

Macra is Malawi’s sole regulator, established under the 2008 Communication Act to ensure reliable and affordable ICT service provision throughout Malawi.

“Its mandate is to regulate the whole communications sector with respect to telecommunications, broadcasting, postal services, and the management of the radio frequency spectrum. As a regulator, it also issues operating licenses for mobile and fixed-line phone service providers, ISPs, and cybercafés, though political connections are often necessary to receive such licenses,” says the report.

With recommendations from the survey therefore Macra economist Linda Kambale said the regulator awaits review of the current Communication Act to address the concerns.

“We are geared to see that the situation changes for the better. The main challenge is that the laws we are now using may not permit us to act on some of the challenges as a regulator.

“The cost of making phone calls remain high, but the operators are trying everything possible to reduce,” she said.

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