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Zimbabweans hooked to cellphones
Jesilyn Dendere/Kuda Chikwanda, Zimbabwe Independent
January 25, 2008

http://www.thezimbabweindependent.com/viewinfo.cfm?linkid=12&id=12233&siteid=1

Zimbabweans might be struggling with the economic crisis but they still love a long yak especially on their mobile phones.

An ordinary Zimbabwean spends at least 200 minutes on the phone a month, according Econet chief executive, Douglas Mboweni. This has come with a heavy toll on the network accessibility.

The international average is 40 minutes per month and that includes people in functioning economies like the United States and New Zealand.

The main reason why the network always looks congested is that the few that manage to get through keep on yapping for hours. The result is that they block the multitudes who also want to make a call.

So bad is the phone habit here that even the base stations can't cope with the demand for calls.

And the reason why they spend so much time on the phone is not that they really have a lot to say but because the charges are so cheap that they can afford to go on and on.

Again it's not that companies are really in a price slashing competition but the really issue is that government has kept the mobile phone charges ridiculously low.

So what does a 'good' chitchat cost in Zimbabwe?

The government says mobile phone companies must charge about $50 000 which is equivalent to less than one US cent -US$0,0089286 to be precise.

So to satisfy their 200 minute phone talk a month habit an average Zimbabwean needs $10m which is about US$1,7 per month at the current black market rate of US$1:$5,6m.

It gets bizarre when one uses the RTGS rate of US$1:$10m. The result is an irritating automated voice that says: "The number you have dialed is not available at the moment. Please try again latter."

And then the less polite message that simply tells you that the network is busy.

Still Zimbabweans will keep trying hoping that when eventually they get through they will talk until they lose their voices.

It's not like the charges have been eroded by inflation. Zimbabwe has always had a low tariff regime, according to Mboweni.

Mboweni said the international standard is that the mobile tariff should at least be about half the price of a loaf of bread or a bottle of Coke. It is however difficult to use this measurement in Zimbabwe because even the prices of those commodities are heavily controlled.

For instance what exactly is the price of a loaf of bread? The government says it's $700 000 but people are getting it at $2m per loaf. As for a bottle of Coke everybody has a different price.

"Communication in Zimbabwe is just too cheap. That is why there is network congestion," said Mboweni last week.

The solution, Mboweni said, lies in increasing the tariff to viable levels. That way people will not talk for a long time and congestion will ease.

The mobile companies however have another bigger problem in that inflation tends to immediately gnaw at every tariff increase.

"We need a system that allows that the networks to continuously review their tariffs in line with inflation," said Mboweni.

That sounds like a reasonable appeal until one checks the organisation that the networks have to deal with to get a price review.

Until six months ago the mobile companies had to deal with the Postal and Telecommunications Regulatory Authority (Potraz) which is run along the same line as Zinwa, Zesa and ZBC.

The red tap, delays and political interference seem to be part of the mission statement.

Last October the government induced another headache for the mobile companies by introducing the National Incomes and Pricing Commission (NIPC).

To get a feel of how NIPC behaves one needs to add to red tap, delays, political interference, incompetence and of course the fact that it is specifically mandated to keep prices down.

Even if they manage to get past Potraz and NIPC the networks will have to deal with Zesa.

"Due to the persistent power cuts most of our base stations are always down. Sometimes we use generators but the fuel is very expensive especially if one considers the low tariffs," Mboweni said.

There are also the serious foreign currency problems currently affecting the whole country.

Econet, Net*One and Telecel have been cut off by major international networks because they can't pay for the termination charges which are made in foreign currency.

The networks cannot expand their networks because of the foreign currency crisis.

Econet is now exporting SIM cards to neighbouring countries as it seeks to raise foreign currency to meet local requirements.

Mboweni confirmed to businessdigest that the company had opted to export SIM cards to alleviate biting foreign currency shortages. Mboweni said EWH had been inundated with requests from Zimbabweans living in South Africa and Botswana for SIM cards.

Mboweni said Econet had decided to leverage external demand for SIM cards with demand for foreign currency.

Econet will use the foreign currency raised to fund operations and import of equipment to expand the network and subscriber base. The target is to increase the subscriber base to 1,5 million.

"Statistics show that official estimates of Zimbabweans living in South Africa are around one million. If we can sell our services to at least 500 000 of them, we'd be some where," Mboweni said.

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