Why is the internet so expensive in Zambia?

The internet is simply a network of many computers and servers exchanging information all around the world. Companies and individuals are connected to the internet and are able to communicate as well as transact electronically.

Zambia has recently seen the number of internet users rise and this has led to the consumers of the internet to expect the facility to become cheaper, reliable and affordable as several services provider have emerged in the ICT industry. The advancement of information and Communication technology (ICT) and new ways of delivering networking tools have also raised hopes that the cost of internet will go lower. Unfortunately, it is remains relatively expensive for the average internet user.

To an extent, consumers and other stakeholders feel they are being exploited by service providers due to the higher charges on internet provision and unreliable connectivity. The service providers will not spend resources go to the media to announce to the users why internet is so expensive but their interest will be how they can convince and sell their services.

But before we condemn our local ISP’s let us first consider what makes internet access expensive, below are some of the common yet unspoken reasons:

1. Geographical location (landlocked country)

Zambia as a country is landlocked, meaning it is surrounded by many other countries and has no direct access to sea ports. Any goods and services being imported into the country have to pass through another country. Before the importer is allowed to connect they have to meet all the regulatory requirements. This also an indirect cost on the importer which is eventually passed onto the end user.

2. Personnel (technical, support, finance, marketing)

Most of the modern technology used to deliver services to the end users requires expert personnel. The sad reality is that competent professionals do not come cheap. Don’t believe the notion that we do not have local expert labor, we do have qualified personnel. It is just that the major investors in the ICT companies are foreigners who always want to promote business from their home country hence they prefer to outsource specialized ICT professionals.

3. Availability of equipment (routers, switches, servers, radios, fibre optic, VSATs)

Zambia is heavily reliant on foreign equipment because as a nation we do not manufacture or assemble ICT equipment. We depend on imported ones to install and manage our infrastructure. The cost of equipment is high in addition to equally high procurement, installation and maintenance overheads. As in the case of optic fibre, this kind of technology was meant to become the savior of internet speed and bandwidth. Service providers had promised that prices will reduce once the completion of fibre optic in many parts of the country had finalized especially along the line of rail. However the grim reality is that fibre is very expensive, it required experts to install and maintain. Take into consideration that Zambia buys or connects to fibre through different countries which are connected to underwater cables.

4. Taxes, regulatory and licensing fees

These overheads associated with internet access are also quite especially for a Zambian startup that ventures into this industry. The government also requires the operators to pay several taxes. These agencies are key players in creating an enabling environment, monitoring the pricing and quality of services.

5. Operational expenses

Those doing business in Zambia will agree that doing business in Zambia has become very expensive due to other factors that support a business such as the escalating cost of fuel, as well as the cost and scarcity of electricity.

6. Unstable exchange rates

The internet we use is imported from countries who own the satellites and fibre. All the pricing is mostly quoted in foreign currencies especially US dollar. The logic is when the kwacha loses its power against the major currencies it means the cost of bulk internet will go higher. The providers will also price their services to dollar equivalence to cope with the international pricing.

In conclusion, the cost of accessing the internet in Zambia is determined by many factors, the geographical location, and high cost of operation expenses, equipment and mainly the strength of the dollar and weak taxation policies. When all these are put together “fair” pricing is drawn so that service provider may get a reward of their investments.

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About the author: Kingston Mwila is an ICT enthusiast with more that 10 years in the ICT sector and related sub-sectors. He is affiliated with various professional bodies such as ICTSZ, ITIL, Microsoft, and FOA. Kingston is currently pursuing an MBA and is academically qualified with a Bachelors of Science of Information Technology (BIT), Advanced Diploma In Project Management (Ad. PM), Diploma in Information Technology (DIT), Optic Fibre certification, Microsoft Certifications and ITIL Certification.

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