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Zimbabwe ISP ZOL stuns market with data tariff hike

Zimbabwe ISP ZOL stuns market with data tariff hike

From Zimbabwe, established ISP ZOL has informed clients that it will raise data tariffs by an average of 5% soon after industry regulator Potraz issued a directive for mobile operators to reduce out-of-bundle charges in July.

In a statement issued this week Potraz had provided ISPs a degree of flexibility: "Internet/data charges for ISPs shall be left to market forces subject to regulatory approval."

ZOL sent an email to clients, dated 20 June 2018, confirming its increase will take effect in August 2018 and cited economic challenges, with specific reference to special excise tax on data charges introduced by government, as the main reasons.

The email reads: "We have delayed passing this charge to you, our customers; since March 2017 when it was announced. Unfortunately, it is no longer possible to disregard the effects of this excise duty on our overall service delivery making it necessary for us to adjust our prices accordingly."

After the 5% adjustment, the cheapest package under ZOL's Fibroniks offerings will cost US$32 for 25GB over 30 days, up from US$29. The service provider's most expensive option, which is uncapped and aimed at corporates, has increased from US$725 to US$755 per month.

ZOL's email continues: "We have continued to provide you with good service despite the economic challenges our country is facing. On the 24th of March 2017, the Finance Act (No.2) 2017, Section 312 (49) was amended by the Minister of Finance, wherein, an additional 5% special excise duty, specified as a Health Fund Levy resulted in an increase on the excise duty to 10% for airtime and data services."

Mobile companies offer US$1 daily data bundles for around 250MB and US$1 weekly limited social media bundles.

The Alliance for Affordable Internet (A4IA) says internet access is expensive in Zimbabwe, highlighting that 1GB of mobile data "costs nearly 45% of a citizen's average income".

Industry sources believe other ISPs, including TelOne, Dandemutande and Liquid, are likely to follow ZOL's example.

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