Liberia, one of Africa’s smallest economies, has seen a rapid growth in mobile users over the last decade, but its regulators are stuck in an ongoing pricing battle with two of the region’s largest telecoms companies in the world.
French giant Orange and Lonestar Cell MTN, a subsidiary of South Africa’s MTN Group have told consumers they are increasing prices because of a new order which imposes additional surcharges of $0.008 for each minute of voice calls and $0.0065 on each megabyte of data.
Under the new plan, a $1 recharge card is worth 15 minutes of voice calls, down from 45 mins. And $2 will buy 600 megabytes on internet data down from 1.2 gigabytes.
In response, the state regulator, Liberia Telecommunication Authority, said on Oct. 8 the mobile companies were engaging in illegal price-fixing and collusion . It gave the network companies 12 hours to rescind their new prices which they did not.
The regulator argues the price floors established in 2019 gave the network companies a windfall of $104 million in extra revenue. And that the new prices are designed for additional profiteering.
French giant Orange and Lonestar Cell MTN, a subsidiary of South Africa’s MTN Group have been in a long-running battle with the Liberia Telecommunications Authority over charges which are aimed at increasing competitiveness and in turn bring stability to the market.
Over the years, the two companies have become a dominant duopoly providing voice calls and data at cheap prices, thus effectively pricing competitors like Novafone out of the market. Novafone was later bought by Lonestar-MTN.
The mobile network companies are fighting to lower their prices arguing that ordinary Liberians cannot afford a price regime which increases the average phone user’s costs by as much as 100%.