Telcos Might be Paying up to $5K fine for poor service in Zimbabwe

In a move to ensure reliable telecommunications services, the Zimbabwean government has introduced new regulations that could see telecom companies fined up to $5,000 for subpar performance. 

These changes, which come under Statutory Instrument 154 of 2024, aim to address the growing competition from Starlink and improve the quality of service for users.

Strict Standards and Hefty Fines

The new regulations set high targets for service quality, including a minimum 95% Data Service Access Success Rate and a Data Service Drop Rate not exceeding 2%. 

Telcos that fail to meet these standards for three consecutive months could face fines of $200 per underperforming cell tower or for delayed text messages.

Moreover, extended network outages will be subject to even heftier penalties. 

Telcos could be fined $5,000 for outages lasting over three hours, with an additional $5,000 for every subsequent hour. 

Failing to meet interconnection standards or submit network performance data will also result in fines.

Pressure on Struggling Telcos

While these new rules aim to benefit users, they add significant pressure on telecom companies that are already grappling with various challenges. 

Zimbabwe’s major telcos, including Econet, NetOne, and Telecel, have been facing financial difficulties. 

Econet reported a staggering $73 million loss in 2024, while NetOne’s troubles have cost the government $200 million over the past two years. Telecel even required corporate rescue to avoid liquidation.

In response to these challenges, the telcos have requested the government to allow them to set prices in US dollars to cope with hyperinflation. 

However, the government’s priority seems to be ensuring reliable service for users, even if it means imposing hefty fines on underperforming telcos.

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Balancing User Needs and Industry Challenges

The introduction of these new regulations highlights the government’s commitment to providing quality telecommunications services to its citizens. 

By setting strict standards and imposing substantial fines, the government aims to incentivize telcos to invest in infrastructure and improve their performance.

However, the success of these measures will depend on the government’s ability to strike a balance between user needs and industry challenges. 

Telcos will need support to overcome obstacles such as electricity shortages and financial losses to meet the new standards and avoid crippling fines.

As Zimbabwe’s telecom sector navigates these changes, it remains to be seen how telcos will adapt and whether the new regulations will lead to a significant improvement in service quality for users.

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