2,500% mobile phone tariff hikes in Zimbabwe

Zimbabwe ’s mobile phone operators have hiked their tariffs by more than 2,500 percent, causing a massive domino effect on the pricing structure of e-commerce, e-banking, and e-business.

The increase drew howls of protest from already hard-pressed consumers who have to contend with Zimbabwe ’s supersonic inflation.

The increase is certainly going to fuel inflation, as telecommunications costs comprise a significant weight in the basket used in calculating the consumer price index.

Econet Wireless, which enjoys about 57 percent of the local subscriber share hiked its tariffs by more than 2500 percent. Its competitors, privately owned Telecel, which has 17 percent of the local market and state run Net*One with 26 percent also hiked their tariffs by roughly the same margin.

Econet increased charges for intra-network calls of Econet to Econet to Z$250 during the peak period. Charges for inter-network charges, or calling other cellphone operators has also shot up during the peak and off peak periods by the same margin.

Calling a landline, sending a local and international SMS and making international outgoing calls to Group 1 and Group 2 destinations has also shot up.

Industrialists and officials in commerce bemoaned the impact the new charges would have on businesses across the country. Zimbabwean mobile phone networks have to meet the bulk of their costs, 95 percent, in foreign currency. The networks have long complained about rigid regulatory oversight over tariffs, a factor which has impacted negatively on revenue.

However, although the networks have enjoyed the relative relaxation by the Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz), they are wary that radical tariff hikes could hit ARPU (average rate per user) statistics hard.