MTN has been issued a fine by South Africa’s Telecoms Regulator, ICASA’s Complaints and Compliance Committee (CCC) for not observing the required notice period when increasing the price of its 1GB WhatsApp data bundle.
The fine comprises a total of R5 million, of which R2 million is suspended for three years following the date of the ruling.
MTN was found to have contravened regulation 9 of the standard terms and conditions by not notifying ICASA at least seven days before changing the price of its monthly 1GB WhatsApp data bundle to R30.
“The contravention, even considered within its background was, accordingly, a serious contravention,” the CCC stated.
“ICASA obviously, by regulation, places a high premium on compliance with the seven working days’ notice. Only two working days’ notice was given.”
However, the committee did acknowledge that MTN faced extenuating circumstances in changing the price before the notice period had lapsed.
MTN explained that it was forced to hike the price of the bundle to avoid a potential disaster.
“The earlier implementation of the price increase was forced by technical risks whose eventual occurrence could have been catastrophic,” the ruling stated.
“The volume of traffic on the WhatsApp bundle was unprecedented, and thus it presented novel challenges to MTN.”
MTN South Africa Executive for Corporate Affairs Jacqui O’Sullivan stated that the price change was implemented due to the unprecedented demand on the operator’s 3G network.
“In April 2018, MTN launched its social bundles and introduced a monthly WhatsApp bundle of 1GB for just R10,” O’Sullivan said.
“The public’s response was exceptional. WhatsApp usage on the MTN network increased by 300% in just eight weeks.”
“An unintended consequence of the low-priced WhatsApp data has been an extraordinary increase in demand on MTN’s 3G network,” she said