By Our Correspondence.
Dar es Salaam, Tanzania - Tanzania Communications Regulatory Authority (TCRA) has expressed optimism regarding the reduction of mobile communication costs following a significant decrease in Right of Way (RoW) fees. The government's decision to lower the fees from $1000 USD to $200 USD per kilometer is expected to have a transformative impact on the affordability of communication services throughout the country.
Right-of-Way (RoW) fees are charges levied on telecommunication companies by the government for utilizing road reserved land under the management of Tanzania Roads Agency (TANROAD) to install vital infrastructure such as fiber optic cables.
Daudi Mkwela, a stakeholder in Tanzania's communication sector who serves as Technical Manager at Zanzibar Broadcasting Corporation, expressed his concern about these fees, emphasizing that “the charges were too high and posed a substantial barrier to the expansion of communication networks, and furthered bundles outcry,” he remarked.
With an 80% reduction in RoW fees, the Government aims to stimulate investment in telecommunications infrastructure, foster competition, and ultimately lower the costs of communication services for all citizens. This move is part of the government's broader efforts to bridge the digital divide and accelerate socio-economic development.
During a press conference held on Tuesday, July 18, 2023, at the Habari-MAELEZO Conference Hall, Dr. Jabiri Bakari, the Director General of TCRA, highlighted the significance of the fee reduction in reducing communication service costs. In the past, when calculating the pricing of communication services in collaboration with service providers, the Regulatory Authority had to consider the impact of RoW costs, which ultimately affected end-users.
"Last year, we faced challenges with service providers lacking sufficient bandwidth for better quality and 5G frequencies, this has been solved by a successful auctioning of spectrum. We also encountered issues with the Right of Way, where service providers were previously required to pay $1000 USD per kilometer annually. However, the fee has now been reduced to $100 USD per kilometer," remarked Dr. Bakari. He further added, "We are optimistic that slashing these costs will substantially reduce communication service expenses."
The reduction in RoW fees will bring immediate benefits by accelerating the expansion of high-speed broadband networks. Internet service providers (ISPs) will find it more economically viable to extend their coverage to remote areas, where the return on investment was previously hindered by exorbitant fees. This expansion will pave the way for improved internet connectivity, enabling businesses, schools, healthcare facilities, and individuals to access online services and participate in the digital economy.
Furthermore, the lowered fees will foster competition among telecommunication companies. Reduced barriers to entry will provide new players with an opportunity to enter the market and offer innovative and affordable services. This increased competition is expected to drive down communication service costs as companies vie for customers by offering competitive pricing plans and improved service quality.
Another positive outcome of the lower RoW fees will be an expansion in mobile network coverage. Currently, many remote areas suffer from limited or no mobile network access due to the high costs associated with network expansion. The reduced fees will make it financially feasible for mobile network operators to extend coverage to these underserved regions, connecting previously isolated communities and promoting social inclusion.
The government's decision to reduce RoW fees demonstrates its commitment to bridging the digital divide and fostering inclusive growth. By making communication services more affordable and accessible, Tanzania aims to provide its citizens with greater opportunities for education, healthcare, e-commerce, and participation in the global digital landscape.
While this reduction represents a significant step forward, challenges may arise during the implementation process. Close cooperation between government authorities, telecommunication companies, and other stakeholders will be crucial to ensure the smooth rollout of infrastructure projects and address any potential issues that may arise.
The reduction of Right of Way fees from $1000 USD to $200 USD per kilometer marks a major milestone in Tanzania's efforts to improve communication services. As the nation embraces the digital age, this reduction will play a pivotal role in boosting connectivity, fostering economic growth, and empowering its citizens with the tools they need to thrive in the modern world.
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