Zambia ICT Sector Performance Review 2010 - Research ICT Africa

Zambia ICT Sector Performance Review 2009/2010
Access & Pricing
Fixed Line
Table 9 below provides information on the prevailing tariffs for ZAMTEL fixed-line network in the
country. Zamtel has progressively simplified its tariff structure over the last decade by reducing the
complexity of its tariff bands from more than twenty (20) to the current three bands, with only per
second billing.
For purposes of comparison with mobile tariffs, we have also shown Zamtel’s per minute billing
derived by straightforward multiplication. The PSTN/CelZ tariffs reflect ZAMTEL's privileged and
exclusive monopoly in the fixed network segment.
Table 11: ZAMTEL Fixed-Line Tariff Structure
Fixed-Line or Public Switched Telephone Network (PSTN) Services
Type of Service
Kwacha Per Second
Kwacha per Minute
Peak Off-Peak Peak Off-Peak
PSTN to PSTN (Band A) Local 3.33 2.50 199.8 90
PSTN to PSTN (Band B) 16.67 12.50 1000.2 750
PSTN to PSTN (Band C) 16.67 12.50 1000.2 750
PSTN to CelZ 16.67 12.50 1000.2 750
PSTN to Other Networks 22 20 1320 1000
Source: ZAMTEL
ZAMTEL has positioned its fixed-line pricing strategy to keep national (long-distance) calls as high
as possible but slightly below the lowest mobile on-net tariff (i.e. MTN at K1066 per minute).
Secondly, call charges from the PSTN to ZAMTEL’s mobile arm CelZ are pegged at the same rate as
PSTN Band (C) call charges, while CelZ to PSTN are pegged at the CelZ on-net tariff level.
The above clearly demonstrates that ZAMTEL is engaging in price discrimination by taking
advantage of its monopoly position in the fixed line segment and offering different termination
rates to its mobile network (CelZ) compared to other networks.
Table 12 below provides information on the charges for international voice services 32 . The other
operators (MTN and ZAIN) are required to route their international traffic through ZAMTEL’s
international gateway. ZAMTEL’s call charges are lower for neighboring countries (mostly in the
SADC region) followed by those with direct links to Zambia. This group of countries includes
Belgium, Canada, France, Italy, the United Kingdom and United States. For example, calls to Uganda
and Kenya, which are in charge Band 3, are higher than calls to the United States and Italy.
Countries that are deemed to be too “hard to reach” attract the highest premium charge.
ZAMTEL is engaging in
price discrimination by
taking advantage of
its monopoly position
in the fixed line
segment and offering
different termination
rates to its mobile
network (CelZ)
compared to other
networks.
32 The International Gateway has since been liberalised leading to significant reductions in tariffs.
23