ZICTA fines slapped on Mobile Telcos not punitive enough?

ZICTA head office in Lusaka

The Zambia Information and Communications Technology Authority-ZICTA has handed a blanket fine and penalized all the 3 mobile phone network providers for failing to adhere to the quality of service parameters as outlined in the quality of service guidelines for two consecutive quarters, the fourth quarter of 2017 and first quarter of 2018 respectively.

ZICTA, in an effort to avoid tilting the competition landscape by fining all the three mobile networks AIRTEL, MTN and ZAMTEL a total K12.6 million for failing to meet some of the set parameters on quality of service which include call set up success rate, mean opinion’s call, successful sms rate, sms delivery time and http success log ins, http success rate as well as http down rate 2G and 3G.

Some market players have accused ZICTA of failing to set an example as these blanket bans are not punitive enough and targeted enough, as a result, they are not being worked on by the players hence the reason why two consecutive quarters of poor quality of service. A further review of the blanket fines that have been used now for like two years running across the industry shows that non of the players is taking these fines seriously and effectively lessening the intended impact of getting improved service quality by the regulator.

According to the press statement availed to Zambia Business Times – ZBT by ZICTA Corporate Communications Manager Ngabo Nankonde., ZICTA fined market leader MTN Zambia limited K3.6 million, the second largest player by market share AIRTEL was fined K4.2 million while state owned ZAMTEL received the highest fine of K4.8 million.

Last year ZICTA fined all the three mobile phone operators a total of K3.1 million for failing to adhere to quality of service parameters as agreed in the quality of service guidelines for the third quarter of 2017. If a company can pay these fines and the fines are less that the cost of investment needed to improve service, a capitalistic management would opt to continue paying the fines. These fines should be punitive enough to make the telco’s opt to spend money to upgrade their equipment that supports service quality than opt to pay the fines for two consecutive quarters.

The mobile Telco’s market in Zambia is an oligopoly with three players, the fourth player Unitel expected to launch its services before the end of 2018. Zambia data and voice services remain among the highest in the region due to the structure of the market. Some players like South African owned MTN has not adhered to key licensing requirements of Listing on the Lusaka Securities Exchange – LuSE, a matter that ZICTA admitted needs to be regularized.