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Icasa takes a stand and gives cellphone data bundles a six-month lifespan

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Shapshak is editor-in-chief of Stuff.co.za and executive director of Scrolla.Africa

The mobile industry will complain but this decision is morally and economically correct as data bundles are ‘virtual’ and don’t go rotten like apples. Operators’ pleas will fall on deaf ears — public goodwill is long gone.

All it took was one bold move to change the fortunes of 60 million South Africans and their cellphone spend. The Independent Communications Authority of SA (Icasa) stepped up this week with a match-winning six (or home run, depending on your preferred batting sport analogy).

Icasa quietly said it wants to amend Regulation 8B of the End-User and Subscriber Service Charter Amendment Regulations of 2018 to read: “Unused data and data services obtained through either prepaid or post-paid channels shall not expire before expiry of a period of 6 months, except for promotional packages.”

Six months. Read it and cheer. Or, if you are a network operator, read it and weep.

Looking at it another way, Icasa has failed to be convinced by network operators that selling a virtual thing somehow has a sell-by date, despite being, literally, unable to expire. This is because, well, it’s not an onion or an apple that really will go off if you don’t eat it within a week. It can’t go off. It, literally, can’t expire. So why have we lived in a world of this artificial expiration date?

Because it makes more money. Always follow the money, as the sages of investigative journalism Mungo Soggot and Stefaans Brummer told me as a young reporter at the Mail & Guardian. Always follow the money.

And there is a lot of money in the mobile industry. Since its launch in the 1990s, cellular telephony has been a boon to us consumers, who initially rejoiced at being able to make or take a call anywhere, anytime. But it came at a cost – and South Africa’s prices have consistently been higher than those in the rest of Africa.

This happened for two reasons: the regulator allowed it and there was no bona fide competition in South Africa, right up until Lars Reichelt took over at Cell C in 2009.

Most people probably remember that time for Trevor Noah’s amusing skits as its “chief experience officer” but it was Reichelt who knew a revolution was coming in data and started the first, real price war.

The mobile operators will remonstrate with the regulator. They will appeal to the public’s good will and understanding – long gone after years of unforgivable profiteering by the operators until the self-same Icasa forced the networks to cut their call termination rates. They will tell anyone who will listen that they can’t remain competitive, that the consumer will suffer, etc, etc. Or, more appropriately, yawn, yawn, yawn.

Every business in the world has to adapt to new regulatory environments, and changes in consumer behaviour – as we’ve witnessed in the past decade’s shift from highly profitable voice services to equally fat data revenue.

It is impossible to feel cellular operators have been hard done by. They have enjoyed nearly three decades of unnecessarily expensive voice calls, followed by years of unnecessarily high data costs. For once, everyone in South Africa is united: after #FeesMustFall it’s time for #DataMustntExpire.

Icasa has delivered that – for voice and SMS bundles as well – while warning operators that they should use “oldest” bundles first. Operators must “in the first instance apply data usage against the oldest of any unused data, until that data is depleted, and thereafter against the newly allocated data”.

Interestingly, there is a new clause for Regulation 8C, a new subregulation that requires “educating end-users on cybersecurity and on the protection of personal information”.

Given the TransUnion hack last month and Experian’s in 2020, education of customers is important – unless, as with Experian, the data thieves used legitimate accounts to access the data before the breach was discovered.

For South African consumers this is a happy day – a sign that the profligate profiteering of the past few decades is passing, and the consumer is increasingly getting cheaper and better telecoms. It’s important not only for social communication, but also, as we saw during lockdown’s work-from-home phenomenon, because  the vast majority of South Africans use cellular data. Having been awarded the spectrum that the mobile networks have been begging for for years, it’s going to be hard for them to claim they are being hard done by with this decision.

If you pay for something that doesn’t expire, it’s only right that you can carry on using it without some artificial sell-by date driven by a profit motive instead of a customer-value offering. DM168

This story first appeared in our weekly Daily Maverick 168 newspaper which is available for R25 at Pick n Pay, Exclusive Books and airport bookstores. For your nearest stockist, please click here.

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  • William Stucke says:

    As I commented elsewhere when this first came out: About time!
    The MNOs have BSd us for years that rolling over data (or voice or SMS) bundles will cause the sky to fall on our heads. Toby is quite right. They make more money stealing our “expired” bundles.
    Well done, ICASA. Why did it take you so long?

  • Rich Field Field says:

    So I guess the packages that offer “lots of data for little cost” with a short expiry will disappear with magician-like speed.
    No more “1Gb for R20 for 1 Day” and the associated breakage earned by the operator. But that would be great to buy (maybe 10 of these) if they are usable for 6 months.
    Just a thought

    • Simon D says:

      Your example would fall under the “promotional packages” part, so would still be there. The regular 30 days / etc regularly priced data is probably going to just be used by Vodascum (in particular) and MTN to fleece consumers even more.

      I just dont know how the rest of the world offers such good value, and even these same networks do in African countries, but in SA, they’ll rip the last blood out of consumers if they can.

  • Geoff Krige says:

    Why does data even expire after six months? Once I have paid for data, I expect to be able to use it, without MTN stealing it back from me after 6 months, or 3 months, or whatever number of months. And why exclude “promotional packages”. Watch this space – it will now become almost impossible to buy any data except via “promotional packages”. Why does ICASA allow this kind of ridiculous loophole?

  • David Dowling says:

    This expiry racket must surely be absolutely illegal.

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