The Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz), has bemoaned poor quality service from telecoms network operators due to congestion, but says the industry is working to address the problem after being given additional bandwidth at no cost.
POTRAZ director general Dr Gift Machengete, said in an interview that each of the operators were given about 20 megahertz up to the end of this year to ease congestion, which has affected quality of service.
But, the operators are reportedly lobbying the regulator to maintain the free additional bandwidth beyond year-end to maintain high quality service, a request the authority said it was still considering.
Dr Machengete said Potraz took the decision to increase bandwidth for operators because of significant and sudden increase in the usage of online and digital platforms due to Covid-19 restrictions.
Following the outbreak of the coronavirus global pandemic earlier this year, Governments across the world enforced strict restrictions that included national lockdowns to curtail the spread of the deadly virus.
Commenting on viability issues in the sector, Dr Machengete said Potraz had given operators permission to increase tariffs to cover costs, which ballooned on the back of exchange rate and inflation increases.
The telecoms operators incurred $13 billion loss in the quarter to June on account of huge losses incurred as a result of inflation and the exchange rate, which moved to around $81 to the US dollar from $25.
In the quarter to June 2020, operators saw revenue increase 45 percent to $3 billion while costs vaulted from $5 billion to $16 billion due to inflationary pressures emanating from exchange rate increases.
A significant component of the operators’ costs are denominated in foreign currency, meaning that the operators incurred huge costs when the exchange rate moved from the fixed $25 to US$1 to a variable rate.
And with the costs now pegged to the auction rate, Dr Machengete said the current tariff would guarantee viability for telecoms operators.
However, the regulatory authority’s boss said that the only concern for the regulator was the issue of congestion and poor service quality.
“The losses were before we gave them a tariff increase. But after we authorised a tariff increase, we believe they should be able to sustain operations, we had last given them a tariff increase a long time ago.
“As such, they made exchange control losses before we gave them a tariff increase because of the exchange rate movement from the fixed $25 to US$1 to between $70 and $83 to US$1, which translates into losses. Most of the network operators require forex. After the Government said they can now use the auction rate to convert their foreign currency denominated costs, we gave them a tariff increase and after that we also issued them another tariff increase because their costs had lagged behind for some time,” he said.
Now that the issue of costs had been addressed, Dr Machengete said of major concern was the poor quality service, which has been occasioned by congestion as a result of Covid-19 regulations.
“The only problem is congestion and poor quality of service. Everybody has gone virtual. There is a problem of congestion which operators are working on. We gave them additional spectrum to cover Covid-19 pressures. We gave them for free,” he said.
Source: https://www.herald.co.zw/potraz-releases-extra-bandwidth/