TelOne’s costs of cross internet connectivity from the undersea cables have increased to US$441 657 per month subsequently adding up to US$5.3 million per year . TelOne Managing Director Mrs Chipo Mutasa brought this to light when she appeared before the Parliamentary Portfolio Committee on Information Communication Technology,Postal and Courier Services on Monday.
Zimbabwe due to its geographical location is landlocked and telecommunications operators such as TelOne face a mammoth disadvantage in accessing internet connectivity and making data affordable as a result of expensive internet bandwidth landing costs.
Generally, landlocked countries have some of the least affordable costs and they tend to have lower incomes that make the actual cost of connection even higher.Operators in coastal countries such as South Africa and Mozambique do not incur operational costs such as these.
Speaking before the Portfolio Committee,Mrs Mutasa said Zimbabwe is landlocked therefore the internet which we get out of the landing stations that are Cape Town,Mthunzini in South Africa and Maputo in Mozambique, which means TelOne has to transit the costs across the two countries.
“We are just under half a million per month,$441 657 that we incur every month just transit fees alone and we pay transit fees to various transporters of that bandwidth” said Mrs Mutasa.
The increase in internet landing costs is one of the impacts of the Monetary Policy Statement on TelOne’s operating costs on the basis that the company imports 90% of inputs to be able to provide service.Resultantly,they have to access foreign currency at an increasing interbank exchange rate which risen to US$1:RTGS$3.5
“On the infrastructure side ,90% are actually imported being internet capacity,funding costs,the equipment itself,software licenses and then the optic fibre that we require to then deploy to various stations.” said Mrs Mutasa
Direct costs of providing services have thus increased by 194% from 2018 and this has necessitated the 150% increase in broadband tariffs which the Postal and Telecommunications Regulatory Authority of Zimbabwe (Potraz) approved and were effected on 1 April 2019.
As a cost-effective measure TelOne through a $98 million loan facility from China Exim launched the Bulawayo-Beitbridge and Harare-Masvingo National Backborne Fibre project that interconnects with regional and international transmission networks and underground cables.This has resulted in an increase in broadband fibre links which are 4000km in terms of optic fibre and 2000km in terms of microwave.
National backbornes are very crucial for a landlocked country such as Zimbabwe as adequate international bandwidth network and quality lead to low data prices which entails that more people will be connected.