Econet raises data prices by 225%

By Staff reporter | 05 May 2020 at 16:11hrs
Econet Wireless hiked data prices by up to 225 percent overnight Tuesday – sparking anger from hard-up Zimbabweans.

The increase in data costs could not have come at a worse time for Econet customers who are in the middle of a coronavirus-induced lockdown that has forced many to conduct business online, including universities and private schools.

There was no explanation for the sharp price increase, but in a letter to its suppliers on April 20, Econet said it was experiencing "difficult trading conditions" occasioned by a "harsh economic environment and the compounded effects of the Covid-19 pandemic."

"As Econet, we operate in a regulated industry where our tariffs are significantly trailing the upward movement in our operational costs, threatening the viability of our business," wrote Econet chief supply chain officer, Sharon Marufu, in the memo.

"We, therefore, need to take drastic measures now to safeguard the business and ensure we remain viable so that we are able to continue offering our services to our customers and to retain our suppliers."

Ironically, Econet was asking its suppliers to slash their prices by 20 percent. The suppliers targeted in the memo included companies providing fuel, trucks, shop space for Econet's retail outlets, and land for base stations.

Zimbabweans reacted with anger to the latest increase on social media, and the hashtag #EconetMustFall was trending on Tuesday morning.

"Everyone is depending on data for work and school and you just chock-slam us with a Z$1,300. Nonsense. Adjust down," one Econet customer wrote on Twitter, quoting the new price of the monthly ‘Private Wifi' which went up from Z$400 for 25GB.

"Lack of serious competition enables Econet to do as they please. The barriers to entry in the telecommunications industry means that we are doomed for a long, long while as consumers and we can't do anything about it," added Paul Nyabando on Twitter.

The popular Private Wifi bundle also sees 50GB go up to Z$2,000 – more than a third of a doctor's salary.

Econet customers also complained that the price increase was effected before midnight, between 10 and 11PM – denying many a chance to buy data at the old prices.

Last month, the Zimbabwe government agreed with bakers, millers and other businesses to cut the prices of basic goods, including bread and sugar, to levels before the country entered a coronavirus lockdown on March 30 amid soaring inflation.

Annual inflation has hit 676.39 percent, one of the highest rates in the world, as a currency that was re-introduced last year weakens amid acute shortages of foreign currency, food and hospitals short of medicines.

Vice President Kembo Mohadi said price increases seen since March 30 were "speculative and unjustified."

Mobile phone companies are regulated by the Postal and Telecommunications Regulatory Authority (POTRAZ), which must approve any price increase.



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