Monopoly pricing of telecommunications services in Swaziland

Lushaba, Samkelo Welcome
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According to Porter (1999, p. 842) “telecommunications, transportation, energy and other sectors, all provide vivid examples of the power of competition to unleash innovation and drive unheard rates of progress… no company and no country can afford to ignore the need to compete”. Literature provides material evidence on the existence of two-way causal relationship between investments in telecommunications and economic development. However, as other writers suggest, such economic benefits may not be fully realised if the telecommunications playing field is not evened out and a proper trajectory of the sector not clearly defined with the necessary ingredients for growth. Such requisite ingredients in the mobile telecommunications sector include a conducive regulatory framework and competition, among others. Competition in mobile telecommunications has been identified in literature as one of the factors that play a fundamental role in lowering prices and driving innovation. More than a decade and a half into the introduction of mobile telephony in Swaziland, the market remains one of the few remaining monopolies in Africa and the only one in the Southern African Development (SADC) countries. By using tariff data across the SADC countries over a five-year period between and including the years 2008 and 2012, this study examines the effects of monopoly in the pricing of telecommunications services in Swaziland, focusing mainly on the mobile telecommunications sector. The study furthers investigates the prospects of introducing another player into the mobile telecommunication market. This extension of the study seeks to provide a corrective recourse if the pricing exhibited some form of distortions due to the monopolistic influence.
Telecommunication policy -- Swaziland. Mobile communication systems -- Swaziland. Cell phone services industry -- Swaziland.