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MTN and the data dilemma

THE announcement by MTN [JSE:MTN] on Tuesday that it will soon allow its customers to share unused data forfeited by subscribers at the end of every month is a step in the right direction towards fair business practices.

READ: MTN wants you to share the data love

Until recently, subscribers have not been able to accumulate unused data – instead, such data is forfeited by the service provider on the advised date of expiry.

The move by MTN, which benefits customers, could see the country’s biggest mobile phone operator Vodacom [JSE:VOD] offering a similar deal.

However, such developments are not likely at Cell C as it is a “non-player” in the mobile data space; it concentrates on voice telephony and will not venture into this space anytime soon. It remains to be seen if Telkom [JSE:TKG] will take a leap of faith and return unused data to customers.

MTN has introduced Data Share which provides subscribers, who generally use data modestly, an opportunity to share unused data with additional MTN numbers belonging to their extended families.

For now operators - MTN, Vodacom and maybe even Telkom - are likely to argue that this is great for customers and should be embraced.

So far industry watchdog the Independent Communications Authority of South Africa (Icasa) has not shown any interest in the matter, perhaps because it is a ‘non-regulatory’ issue.

This begs the question: which institution is supposed to look after this unused data?

For a very long time mobile operators - including fixed-line telephone operator Telkom - have taken back unused data even though consumers pay for it.

This simply means that these operators have been unfairly taking money away from their customers and now they are ready to make amends.

Subscribers owe it to themselves to ask tough questions about this type of business practice.

How are other countries similar to South Africa tackling the question of unused data?

The US solution

In December 2014, US-based T-Mobile announced a move to eliminate the infuriating mobile phone industry practice of confiscating unused data that has already been paid for.

It introduced a Data Stash, which enables customers to store and use the data for up to a year.

This service is provided at no extra charge to the customer.
 
Earlier this month, AT&T announced that its Mobile Share Value (similar to MTN’s Data Share) will automatically receive the Rollover Data feature at no additional costs.

The company said all Mobile Share Value customers will have unused, shareable plan data in a given month rollover to be used within the next month.

The developments in the US prompt the question why MTN, Vodacom and Telkom are not providing a similar carry over of data with as much as a year before it expires?

My biggest whinge with the unfair practice is that in correcting the anomaly we will be forced to share this unused data with other subscribers, which will still benefit the operators.

While unused data is meant to roll over in the hands of the consumer, it doesn't make sense to have a pay-and-return facility that ultimately benefits operators.

Perhaps the regulator should consider giving the unused data to those who can’t afford to buy it in the first place, rather than share it among the well-to-do.

Such a move could act as an incentive provided by those who are not concerned about the confiscated unused data – this can help bridge the yawning data digital divide.

Even if Icasa buys into this proposal, it still has limitations on how it will monitor it.

One way of dealing with this problem involves encouraging operators - including internet service providers -  to report leftover/unused data on a monthly basis. Alternatively, operators could be requested to disclose revenue from carryover as part of their annual statements.

Obviously, a reliable system with checks and balances must be created to ensure that those who don’t comply face the consequences.
For now MTN should be congratulated for being the first operator to attempt to deal with the controversial issue of confiscating unused data.
 
 
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