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Candid discussion about data costs

Computer cross stalk

A few years ago, I had a candid discussion about data costs in Malawi with a chief executive officer (CEO) of some internet provider. I had gone to that meeting armed with data that incriminated ISPs as culprits responsible for extortionate data prices in Malawi.

At that time, South Africa, Kenya, Botswana and even war-torn Somalia had data charges that were way below what we had here. Fast forward to this day; the situation is the same. Data is still as expensive as jet fuel in Malawi.

After the meeting with the CEO, the narrative of the article that I had already done at the time and waited publication changed completely. Actually, I had gone to that meeting as a matter of courtesy, to hear the man out before publishing what I had found out. In journalistic terms, I was trying to balance the story.

The CEO with an amazing tech know-how was honest enough to agree that ISPs could do a lot better but went ahead to say that government was an accomplice in the ‘crime’.

The man took a deep breath and asked: “If the government is as interested in the data loot through hefty taxes, who are we not to?”

Stunned, I asked the CEO to defend his assertions. He explained to me that, to start with, data was surtaxed at 17 percent in Malawi. As if that were not bad enough, the government imposed an additional 10 percent excise tax. That meant that for every K100 that ISPs charged for data, K27 went to the government.

Just when I thought he was done with his onslaught, he had more to add. He explained to me that ISPs pay hefty annual licences to Macra. ISPs do not pay these licence fees from their profits; they pass on the same to the consumers of data. It is some hidden tax.

The CEO’s hypothesis was that the licence fees translated to an equivalent of yet another 13 percent tax on data. He left me to do the math. Let me extend the favour, do the arithmetic!

These figures have not changed. By now you should know what I am trying to say or you have not been listening.

The question is not whether or not data prices should fall. The question is who should effect this; Airtel, TNM or the government?

I have always said it and it does not hurt to repeat it; government should not be hypocritical; it is part of the problem. When questioned by ISPs, the current minister of information was not sincere; he only said that taxes were important, whatever that meant.

What shall we say about these things? The internet is the engine of growth for development. Government must create deliberate policies and tax regimes that will bring data prices down.

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