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Lack of Competition Makes Data Expensive in Namibia-CRAN

By: Nghiinomenwa Erastus

Namibia is one of the most expensive countries in Africa for mobile broadband, the cheapest product assessed by the first quarter of 2021 for 1GB monthly prepaid usage was around N$124.5. (USD8.3).

As a result, Namibia slipped in the African Affordability Ranking from the fourth cheapest in the first quarter of 2016 to the 33rd most affordable country in the first quarter of 2021 for 5GB per month.

This is according to a presentation early this year to stakeholders by Helene Vosloo, head of economics and sector research at the Communication Regulatory Authority of Namibia (Cran).

The presentation gives the result of the review that assessed developments in the telecommunication sector for 2020.

Vosloo indicated that while Africa has seen rapidly declining mobile broadband prices, in Namibia, they have increased.

She states that “the high broadband prices in Namibia are due to a lack of competition”.

In Namibia, by the first quarter of 2021, 1GB monthly prepaid usage cost around N$124.5. (USD8.3).

In comparison, the same basket costs 60 US cents in Egypt, USD4.7 in South Africa or even USD4. 3 in DRC Congo.

Broadband is defined as a minimum of 2Mbps download speed available to 80 of the population.

As it stands, Cran revealed that 26 countries in Africa had faster average broadband speeds than Namibia.

Vosloo also indicated that Namibia’s 3G could hardly be called broadband.

She explained that fast, high quality and affordable broadband internet is the foundation of the digital economy.

“Lower prices and subsequently higher broadband penetration would translate into productivity gains and economic growth, said Vosloo.

According to their assessment, a reasonable price per GB would be N$15 per GB.

It is a conservative price based on total cost and an added 27 per cent profit margin.

This price would be a 28 per cent reduction over MTC’s effective cost per GB for the financial year 2019 to 2020 of N$20.8, Vosloo presented.

Cran also indicated that mobile data revenues, as a percentage share of voice revenues, continue to increase.

Fixed data revenues are on the increase from N$268.6 million to N$1,8 billion between 2012 and 2020.

The sector revenue increased from N$4,8 billion in 2019 to N$5,1 billion in 2020; more than half of the revenue was made by MTC.

Nearly 1.8 million mobile SIM cards use data in Namibia, or 61 active SIM cards are used to access the Internet.

Cran carried out this study focuses on the infrastructure aspects of mobile broadband, namely access, usage and affordability, which fall under Cran’s supervision.

Access is measured via population coverage- for nationwide coverage, only mobile 4G or better is suitable as an indicator in the short to medium term; 3G in Namibia is too slow to be counted as broadband, with average speeds of around 1 Mbps.

Affordability is measured as the price for a broadband user basket as a percentage of average individual income.

The UN Broadband Commission sets the target at less than 2 per cent of Gross National Product per month for 1GB.

In terms of affordability, Cran indicated minimal movement in Namibia’s mobile market regarding price competition.

The cheapest product from MTC that qualifies for the 1GB basket per month is Aweh O Yeah, costing for 30 days N$123. 71.

The cheapest product from TN Mobile is JIVA with N$147.86 for 30 days.

Namibia is far from the UN Broadband Commission objective of 2 GNI per capita for 1 GB per month.

At a national average, 1GB per month makes up 4.4 per cent of average expenditure per capita per month.

In Kavango West, Kavango East and the Zambezi, it is even above 10 per cent.

In terms of coverage, the country still has 534 593 (half a million) of the population without access to 4G.

The lack of a 4G network is worse in regions such as Kunene, Okavango West and the Omaheke Region, where less than 50 per cent of the population has access.

Usage is measured in speed; the faster the average download speed, the more services can reasonably be accessed; streaming requires, for example, a higher download speed than emails.

Also, video conferencing requires higher upload speeds than video streaming, which mostly requires fast download speeds. Email: erastus@thevillager.com.na

Julia Heita

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