Tanzania Regulator Cuts Mobile-Phone Interconnection Fees 69%

Tanzania cut the fees that mobile- phone companies charge each other for calls across networks by 69 percent starting March 1 as it seeks to boost competition and grow subscriber numbers.

The so-called interconnection rate will fall to 34.92 shillings from 112 shillings, the Tanzania Communications Regulatory Authority said in statement posted on its website today. The fee will be cut gradually to 26.96 shillings by 2017, according to the statement.

“It is the considered view of the Authority that traffic patterns will change through increase of subscribers and air time,” TCRA said.  

Vodacom Group Ltd.’s (VOD) Tanzanian unit, the country’s biggest operator by subscribers, on Jan. 21 said the reduction in the interconnection fee may curb investment in telecommunications infrastructure in East Africa’s second-largest economy. Johannesburg-based Vodacom is 65 percent owned by Newbury, England-based Vodafone Group Plc. (VOD)

Tanzania has 47 mobile subscribers per 100 people, compared with an average of 62 in neighboring Kenya and 100 in South Africa, the continent’s largest economy, according to data published on the website of the Geneva-based International Telecommunications Union.

To contact the reporter on this story: David Malingha Doya in Dar es Salaam at dmalingha@bloomberg.net

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net

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