Monday, October 16, 2017

COMESA Seals Deal to Abolish Mobile Roaming Charges

Members of the Common Market for Eastern and Southern Africa (COMESA) have agreed to abolish mobile phone roaming charges in the bloc, according to a news report. The bloc said that although pricing of voice services in many African countries was becoming competitive and comparable with those in the rest of the world, the cost of broadband continued to be out of reach for most people. It said that users in Africa paid on average 25 percent of monthly gross national income per capita on mobile calls, compared with 11 percent in other developing nations.
As part of the deal, the ministers agreed to draft regulations to support investment in MVNOs as a way of enhancing competition. In Africa, MVNO permits have been issued in Morocco, Kenya and South Africa.
Famously, the European Union abolished roaming surcharges this past June, and now we see another large region moving to do the same. However, rather than interpreting this as a trend, we should draw attention to the differences between the two situations.
In the EU, the move to end roaming charges was largely in response to consumer revolt, within the context of a highly developed set of economies and mature mobile markets. In COMESA, mobile economies are still developing and are still far from reaching maturity. Africa represents 7 percent of internet users across the world; the 18 COMESA member states represent over 37 percent of internet users in Africa and 2.5 percent of the world’s population of internet users. Lack of affordability of services has proved a persistent barrier to entry for too many potential mobile device users in the region. Therefore, the move to get rid of roaming surcharges is motivated by a desire to promote growth of the market.
This is not first time roaming charges have been eliminated within the region. The East Africa Community (EAC) has already implemented the concept of uniform phone charges, and Kenya, Uganda and Rwanda have implemented harmonized voice and SMS charges under the Northern Corridor Integration Projects initiative.
Of course, more than simply abolishing roaming surcharges will be needed to increase affordability of mobile services in COMESA countries, but it is a valid first step. The fostering of an MVNO sector should also help to increase the uptake of mobile services. 

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