Vodacom, you can do far better

As he began addressing members of the fourth estate – who had been called to a media briefing about Vodacom SA’s much-anticipated announcement about reducing data costs – Competition Commission commissioner Tembinkosi Bonakele invoked Nelson Mandela’s words, saying:“The long-term stability of our democratic order is also dependent upon all sectors of the population participating meaningfully at all levels of the economy.”

By the time the media shindig was over, the signature line, “Greed, for lack of a better word, is good” – by fictional character Gordon Gekko from the movie Wall Street – had rattled my senses.

Let me explain.

As we prepare to transition our economy to meet the demands of the fourth industrial revolution and strive for an inclusive digital economy, access to affordable internet connectivity has become increasingly pronounced.

Insights from a 2015 survey, conducted by the SA SMME Forum, indicated that, increasingly, the quality of emerging entrepreneurs and enterprises remained unpredictable.

The prevailing SME development ecosystems often assume that entrepreneurs are adequately equipped with the necessary skills, including mechanisms to participate meaningfully in the mainstream economy.

However, this does not accord with the demands of the new digital frontiers and the vagaries of an intertwined, globally competitive economic world.

The demand for new, innovative and disruptive ways of living our lives and doing business have, sadly, been met with unyielding corporate greed and apparent disinterest by those tasked with checking corporate excesses.

Therefore, organisations and communities advocating enhanced technology diffusion and affordable access to a connected world have their work cut out for them.

On Tuesday, I found myself nestled among an anxious crowd in the packed auditorium at Tshedimosetso House in Hatfield, Pretoria.

This was the venue for the joint media briefing hosted by Vodacom, the Competition Commission and the department of economic development.

The purpose for holding this media shindig was to “reveal” that an agreement had been reached about Vodacom’s latest data pricing.

Read: #DataMustFall: Vodacom slashes prices as MTN users must wait till month end

Bonakele, as expected, announced that the commission and Vodacom had, subject to ratification by the Competition Tribunal, “reached a significant agreement to reduce the costs of data and promote digital inclusion”.

The agreement included a 30% retail price reduction on the headline price of a 1 gigabyte data package, effective from April 1 (a case of fool’s gold?), along with the “zero rating of data” through Vodacom’s so-called ConnectU platform.

Doing internet searches on Wikipedia – and accessing essential services as well as university and job portals, inter alia – are key areas that are set to benefit from this agreement.

The lukewarm reaction that the announcement elicited from the assembled social activists, technology pundits and writers was unsurprising, given the hype that had preceded it. It is safe to say that there was no discernible excitement around.

If our quest for an inclusive digital economy is the holy grail, then technology diffusion and affordable access to information and communications technology (ICT), and data, are the requisite powers that will provide infinite sustenance for national economic growth and competitiveness.

Vodacom, South Africa’s largest mobile network services provider, has a moral duty to help us realise this ideal.

The need to access digital information repositories transcends Vodacom’s zero-rated platforms.

This agreement does not herald intuition for building new or emerging small enterprises, nor does it sustain existing ones.

Vodacom will cut its data prices by up to 40% beginning April 1. This is part of an agreement that the service provider reached with the Competition Commission. Picture: Getty Images

For instance, most supply chain and procurement platforms are hosted on the sites of private companies and public benefit organisations.

Lest I be accused of unfairly raining on the parade of Vodacom et al, I do admit that the data-price reduction is a step in the right direction.

It is universally agreed that government delays in allocating 4G spectrum on the 700 to 800 megahertz band have led to increased input costs for telecommunications – which, in turn, affect data pricing.

It is also argued that the two dominant mobile network service providers – Vodacom and MTN – habitually use this malaise as a red herring for their lack of commitment to increase their investments in the local digital economy.

And, for as long as telecommunications regulator the Independent Communications Authority of SA continues to delay the auction process that will allow for additional frequency, there is little room available for the Competition Commission to eke out concessions from the dominant players.

Thus, underserved communities will perpetually be victims of price gauging by them.

In his address, Trade and Industry Minister Ebrahim Patel claimed that the prospect of protracted litigation against a financially well-resourced Vodacom was a central consideration in government’s capitulation to a company that owes its origins to local taxpayers.

It seems Patel is impervious to this reality check: our democracy falters when political expediency and anti-competitive behaviour are allowed to trump any considerations for our national economic development.

This creates the need for interested parties to intercede as soon as the Competition Tribunal considers the rationality of the concessions made to Vodacom by the commission – else, in its current form, the agreement will only encourage MTN and others to do less.

This could place our economy in a regressive trajectory in terms of ICT competitiveness.

We can avert this and ensure digital equity only if we succeed in taming the unchecked corporate greed that seems to inform the Vodacom agreement.

I have a nagging feeling that the road to South Africa’s elusive digital utopia and competitiveness is not underpinned by a genuine quest for meaningful economic participation by all and could, after all, also be paved with fool’s gold.

Et tu, Competition Commission?

Khaas is director of Public Interest SA, a public benefit organisation, a fellow of the Internet Service Providers Association of SA and president of the SA SMME Forum.

Get in touch  City Press

+27 11 713 9001 news@citypress.co.za Media Park, 69 Kingsway Road, Auckland Park

Rise above the clutter | Choose your news | City Press in your inbox

City Press is an agenda-setting South African news brand that publishes across platforms. Its flagship print edition is distributed on a Sunday.