Zimbabwe’s telecommunications landscape is bracing for another round of price adjustments as both NetOne and Liquid Home have announced impending tariff reviews. These announcements come amidst a backdrop of currency fluctuations, the entrance of Starlink, and a dynamic market adjusting to the realities of a gold-backed currency, the Zimbabwe Gold (ZiG).

NetOne’s Bundle Review

NetOne, Zimbabwe’s second-largest mobile network operator, has taken a proactive stance by announcing a comprehensive review of its bundle prices. This review encompasses both data and SMS offerings, reflecting the broad impact of economic pressures on the company’s operations.

In their public notice, NetOne stated:

“Kindly note that we will be reviewing our headline tariff for voice, data and SMS effective 17 October 2024. Visit our website and social media handles for more information.”

The notice went on to provide the following details:

Per Second Tariff Voice: ZWG 0.0177
Per MB Tariff Data: ZWG 0.1660
Per Unit Tariff SMS: ZWG 0.2161

Although these figures provide some insight into the scale of the increases, the full impact on popular bundles and packages remains to be seen. Mobile Network Operators often use these tariffs when composing their bundles. We will update the NetOne bundle price page as soon as we notice a change in their bundle prices.

While we expected the move by NetOne we were kind of hoping they wouldn’t make this move due to the “Starlink effect”. Starlink, with its massive economies of scale, has been offering unprecedented prices of just US$30 per month for speeds of up to 100 Mbps (Residential Lite) and US$50 per month for uncapped internet with speeds of up to 200 Mbps. These competitive offerings have put significant pressure on local ISPs to maintain affordable pricing. NetOne’s approach to the Starlink threat has been notably passive. Unlike its main competitor Econet, which has been proactively adjusting its strategies, NetOne has made few changes to its bundle offerings. The company’s most significant recent announcement was its venture into 5G technology which is still in its infancy.

Liquid Home’s Price Adjustment

Liquid Home, a subsidiary of Liquid Intelligent Technologies, has also announced an “adjustment” to its internet prices. According to the company’s statement:

“Liquid Intelligent Technologies would like to advise you of a price adjustment on our products and services with effect from 17 October 2024 in accordance with Postal & Telecommunications Regulatory Authority of Zimbabwe approval.”

Interestingly, Liquid Home has not disclosed the specific details of the new pricing structure. This lack of transparency has led to speculation and uncertainty among consumers. The company has stated that the new prices will take effect on 17 October for those purchasing bundles, while customers on unlimited packages will see changes from 1 November.

The Broader Context: Currency Fluctuations and Market Pressures

These price adjustments come against the backdrop of significant currency fluctuations in Zimbabwe. As we reported in our recent article on Mbare Musika vendors adopting new exchange rates, the informal sector has been quick to adjust to new realities, with many now using a rate of $40 ZWG to 1 USD. This rapid devaluation of the Zimbabwe Gold (ZiG) currency has put pressure on businesses across all sectors to adjust their pricing.

For ISPs, the challenge is particularly acute. Many of their costs, including equipment and international bandwidth, are denominated in foreign currency. As the ZiG loses value against the US dollar, these providers face increasing pressure to raise prices to maintain profitability.

The Starlink Factor

The entry of Starlink into the Zimbabwean market has been a game-changer. As we discussed in our article on Utande’s response to Starlink competition, established ISPs are being forced to innovate and improve their offerings to remain competitive.

Starlink’s success in Zimbabwe has been remarkable, with the service becoming oversubscribed in Harare shortly after its launch. This rapid adoption highlights the pent-up demand for affordable, high-speed internet in the country. However, it’s worth noting that Starlink only accepts USD payments, which may limit its accessibility for some consumers.

Industry Responses

The responses from different players in Zimbabwe’s telecommunications sector have varied:

Econet: The country’s largest provider has been proactive in defending its market share. The company has been experimenting with a mysterious “unlimited bundle” and has slashed prices on its SmartBiz offerings. Econet has also expanded its LTE coverage significantly.
NetOne: As mentioned earlier, NetOne’s response has been relatively muted. The company’s focus on 5G technology suggests a long-term strategy, but it may need to address more immediate competitive pressures.
Liquid Home: While announcing price adjustments, Liquid Home has also introduced new features like seamless package switching between pay-as-you-go and uncapped plans, as detailed in our recent article on Liquid Home’s new switching feature.

Frequently Asked Questions

Q: When will the new prices for NetOne and Liquid Home services take effect?
A: NetOne has not specified a date, while Liquid Home’s new prices will be effective from 17 October for bundle purchases and 1 November for unlimited packages.

Q: Will other providers like Econet also adjust their prices?
A: It’s likely that other providers will follow suit, especially given the recent currency fluctuations and competitive pressures from Starlink.

Q: How does Starlink’s pricing compare to local providers?
A: Starlink offers packages starting at US$30 per month for speeds up to 100 Mbps, which is generally more competitive than local offerings. However, Starlink only accepts USD payments.

Q: Are these price adjustments related to the recent ZiG devaluation?
A: While not explicitly stated, the recent devaluation of the ZiG likely plays a significant role in these pricing decisions, as ISPs need to maintain profitability in the face of increasing costs.

The announced price adjustments by NetOne and Liquid Home mark another chapter in Zimbabwe’s evolving telecommunications landscape. As currency fluctuations continue and competition from global players like Starlink intensifies, local ISPs are being forced to reassess their strategies and pricing models.For consumers, these changes may lead to higher costs in the short term. However, the increased competition in the market could ultimately drive innovation and improvements in service quality. As always, we at Zimpricecheck will continue to monitor these developments closely and provide updates as more information becomes available.

Stay tuned to our website and WhatsApp channel for the latest on internet pricing and telecommunications news in Zimbabwe.