POTRAZ, Zimbabwe Claims Telecoms Tariffs as Outdated

Published By : 25 Aug 2014 | Published By : QYRESEARCH

As informed by industry’s regulatory body, rates decided by the telecommunication companies do not reflect the cost of procuring the services. 

This issue is based on a recent study by the telecoms services providers based in Zimbabwe regarding overcharging consumers on different products. 

However, against this backdrop the Postal and Telecommunications Regulatory Authority of Zimbabwe have come up with a new model that will cut down the cost of doing business too. 
The regulator body has appointed operators on tariff issues who have resulted 30 percent tariff cuts on the products. 

Zimbabwe has three mobile network operators, such as Telecel, Econet, and Net-One that charge 23 cents per minute for all local calls. But, the inter-network voice call charges were likely to drop to 16 cents per minute. 

According to a study by POTRAZ for the telecommunications sector several events have been overtaken to replace the costing model. Mr Alfred Marisa - acting director general of POTRAZ said new findings of the on-going study would be applied in due course. He said, different changes in the sector including increased subscriber growth, new service offerings, such as mobile internet, current telecommunicates rates, increased network upgrades, and expansion - were no longer admissible.

The company has also completed an overall cost study for telecommunication services, including data and voice, and the telecom rates that were earlier determined in 2009 were not applicable on the recent study, said Mr Marisa. He said the rates have to be cost based rather than benchmarking with rates posed in other countries as operators vary from country to country. 

The aim of POTRAZ is to align costs and ensure operators charge fairly. According to the company, all rates of telecommunications are cost based. 

The current cost structure is based on the COSITU model (a model determining tariffs and costs) for telephone services. This model is totally obsolete and needs a new replacement cost model such as, the Long Run Incremental Cost (LRIC).
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