Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News
      Woan's ghost exorcised - Solly Malatsi

      Woan’s ghost exorcised

      25 September 2026
      Eskom's profit doubles even as it sells less electricity - Mteto Nyati

      Mteto Nyati to stay on as Eskom chairman

      25 September 2026
      Meta's new gadget is a pocket watch for its viral AI agent - Muse Charm

      Meta’s new gadget is a pocket watch for its viral AI agent

      25 September 2026
      Insurers carry the can for MIP breach, regulators say

      Insurers carry the can for MIP breach, regulators say

      25 September 2026
      South Africa's car exports face an EV reckoning

      South Africa’s car exports face an EV reckoning

      25 September 2026
    • World
      Anthropic weighs new model launch to blunt OpenAI's Astra surge - Anthropic CEO Dario Amodei and OpenAI CEO Sam Altman

      Anthropic weighs new model launch to blunt OpenAI’s Astra surge

      21 September 2026
      Hackers hack hackers: ShinyHunters seizes cl0p's dark web site

      Hackers hack hackers as dark web feud erupts

      21 September 2026
      Film piracy malware is reaching corporate machines

      Film piracy malware is reaching corporate machines

      21 September 2026
      Crypto's big bet fails as US senate sinks Clarity Act

      Crypto’s big bet fails as US senate sinks Clarity Act

      16 September 2026
      'This is not circular': Jensen Huang defends $3.5-billion MediaTek deal

      ‘This is not circular’: Jensen Huang defends $3.5-billion MediaTek deal

      2 September 2026
    • In-depth
      Meta to the AI industry: slow down without us - Mark Zuckerberg

      Meta to the AI industry: slow down without us

      16 September 2026
      Google DeepMind CEO Demis Hassabis. Image: John Sears

      The plan to stop AI from breaking the world

      16 July 2026
      The internet has a Strait of Hormuz problem

      The internet has a Strait of Hormuz problem

      15 July 2026
      AI boom sparks rally, frenzy and fear

      AI boom sparks rally, frenzy and fear

      11 June 2026
      Every plug-in hybrid on sale in South Africa, ranked by price - Lamborghini Temerario

      Every plug-in hybrid on sale in South Africa, ranked by price

      7 June 2026
    • TCS
      TCS | Octotel's Trevor van Zyl on the fibre merger question

      TCS | Octotel’s Trevor van Zyl on the MetroFibre merger question

      16 September 2026
      Meet the CIO | Shoprite's Chris Shortt on what a supermarket becomes

      Meet the CIO | Shoprite’s Chris Shortt on what a supermarket becomes

      9 September 2026
      Rubicon's EV charging network is profitable - and growing fast - Watts & Wheels

      Rubicon’s EV charging network is profitable – and growing fast

      8 September 2026
      Winstone Jordaan on building a national EV charging network

      Winstone Jordaan on building a national EV charging network

      2 September 2026
      Watts & Wheels S1E8: 'Tesla lands in Africa, just not here'

      Watts & Wheels S1E8: ‘Tesla lands in Africa, just not here’

      24 August 2026
    • Opinion
      Regulating AI: apply the laws we have first - Dirk de Vos

      Regulating AI: apply the laws we have first

      21 September 2026
      The end is nigh, and the shares go on sale in October - Duncan McLeod

      The end is nigh, and the shares go on sale in October

      14 September 2026
      The fragile joint in the Capitec machine - Pambos Soteriades

      The R197-billion market the banks can’t reach

      25 August 2026
      South African tech's compounding debt problem - Jannie van Zyl

      Management consulting as we know it is over

      21 August 2026
      South African tech's compounding debt problem - Jannie van Zyl

      The most dangerous customer is the quiet one

      10 August 2026
    • Company Hubs
      • 1Stream
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • Ascent Technology
      • AvertITD
      • BBD
      • Braintree
      • CallMiner
      • CambriLearn
      • CM.com
      • Contactable
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • HOSTAFRICA
      • Incredible Business
      • iONLINE
      • IQbusiness
      • Iris Network Systems
      • Kaspersky
      • LSD Open
      • Mitel
      • NEC XON
      • Netstar
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Telviva
      • Tenable
      • Vertiv
      • Videri Digital
      • Vodacom Business
      • Vox
      • Wipro
      • Workday
      • XLink
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and Media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Financial services
      • HealthTech
      • Information security
      • Internet and connectivity
      • Internet of Things
      • Investment
      • IT services
      • Lifestyle
      • Policy and regulation
      • Public sector
      • Retail and e-commerce
      • Satellite communications
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
      • Watts & Wheels
    • Events
    • Advertise
    TechCentralTechCentral
    Home » Opinion » Alison Gillwald » Digital equality: South Africa still has a long way to go

    Digital equality: South Africa still has a long way to go

    By Alison Gillwald7 March 2020
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    Get breaking news on WhatsApp

    The author, Alison Gillwald, says free “lifeline” data won’t reduce digital inequality

    In Cyril Ramaphosa’s state of the nation address earlier this month, the president highlighted the fact that the Competition Commission had instructed mobile operators to adjust their pricing in a bid to reduce digital inequality in the country. He referred positively to interventions aimed at mitigating inequality.

    These are likely to have mixed outcomes.

    The commission’s decision to force mobile operators to remove the “poverty premium” on low-denomination, prepaid mobile bundles has been widely welcomed as something the telecommunications regulator should have done years ago.

    A large number of the beneficiaries of the lifeline service who are capable of paying for the service will get the welfare benefit

    The “poverty premium” refers to the fact that poor people pay more than wealthier people for data. This happens in two ways. Firstly, prepaid data in South Africa costs way more than post-paid or contract data per megabyte. Logically, the price for it should be lower because it’s being paid up front, but it isn’t. Secondly, the price of low-volume, small-value bundles, typically purchased by poor people, compared with the high-volume packages, usually purchased by wealthier users, are highly discounted.

    Even if this may, arguably, inhibit the kind of product innovation that brought people online by offering micro-products, the intervention in the market is warranted on public interest grounds. And it is likely to have the intended outcome of making data more affordable for the poor.

    The president also referred to the free “lifeline” data package — a certain amount of data daily at no cost, proposed by the commission. The premise for this is much like the free basic water policy in the country which gives household 6 000l before charges kick in.

    ‘Free data for all’

    The “lifeline” package was hailed on public talk shows as “free data for all”.

    But adopting this in the far more complex telecoms infrastructure market is likely to produce some unintended consequences. In particular, it won’t reduce digital inequality. In practice the “free” lifeline data package will be given to everyone with a prepaid Sim card (85% of the data market) as the administrative costs of identifying the needy to provide the subsidy to is too high.

    This will produce a classical free-rider problem. A large number of the beneficiaries of the lifeline service who are capable of paying for the service will get the welfare benefit.

    There is also considerable evidence that the costs of mandatory user subsidies are transferred to end users’ prices. Levies like this are not paid from operator surpluses. Instead, they are built into the cost of services. Unless tightly monitored and regulated, this in turn drives up the price of services for users.

    From a public interest policy perspective, cross-subsidisation is justifiable if the subsidy and cost allocation is transparent. And if the increased cost being paid by those online, for example, is used to subsidise the extension of networks or services to get the rest of the population online. This is what happened in classical universal service regulation to get networks extended into remote areas.

    But the lifeline subsidy does not bring more people online. It subsidises the cost of data for those who are already online — rich and poor. The lifeline subsidy may enable those who are already connected through smart devices to use data more optimally to enjoy the benefits of being connected, such as financial inclusion, information gathering and job-seeking, but it does not assist with bringing the 50% of South Africans who are offline, online.

    There are alternative ways of subsidising data and bringing people online. One example is providing free public Wi-Fi at all public buildings

    The commission focused on the negative impact of data prices on consumers. And there is certainly evidence that price affects usage — in South Africa usage is way below the average in similar-sized economies with less inequitable income distribution.

    In the Research ICT Africa After Access 2018 survey of 10 African countries, including South Africa, non-users said that the price of smart devices was at primary reason for people not being connected. For those that were connected the cost of data was identified as the reason for their sub-optimal use.

    This shows that reducing data prices without attending to the cost of the devices (and other problems once people are connected, such as the lack of digital literacy) does not redress digital inequality.

    Mirrored online

    There are other reasons, too. Analysis of the 2018 survey shows that access and use of the Internet, across all countries, including South Africa, is determined by education and the corollary indicator of income. The survey showed that education, income and locational inequalities are simply being mirrored online — arguably amplified — as the economic and social value of being digitally networked increases exponentially.

    There are alternative ways of subsidising data and bringing people online. One example is providing free public Wi-Fi at all public buildings. This would enable those who were unable to pay for airtime to go online by accessing a public Wi-Fi point. This was proposed in the South African broadband plan, SA Connect, but was never implemented in the manner and scale intended.

    With successful Wi-Fi initiatives at city level, price-sensitive users are increasingly supplementing the purchases of their low-denomination bundles with public Wi-Fi. In the 2018 After Access survey, in South Africa 32% of Internet users indicated that they used public Wi-Fi at least once a month.

    Policy needs to address the underlying human development challenges if people are to be equitably brought online

    Of course, those who could afford data services would also be able to access the free Wi-Fi. But they wouldn’t get in automatically. They would need to make the effort of getting to a free public access point, which price-sensitive users do.

    Another option is zero-rating public interest services. “Zero-rating” is when no price is charged for the data used to access and use an application or website. This is proposed by the commission for government, educational and other public interest websites.

    But this is sub-optimal. Ideally, zero rating such sites should be in addition to some free public Wi-Fi. The poor should also be afforded choice and the benefits of access to the open Internet.

    Policy needs to address the underlying human development challenges if people are to be equitably brought online as well as enabled to shift from meagre passive consumption, to transaction-cost-reducing online activities, and even to enhancing their well-being and livelihoods.

    Policies that don’t address these challenges will simply perpetuate existing inequalities.The Conversation

    • Written by Alison Gillwald, adjunct professor, Nelson Mandela School of Public Governance, University of Cape Town
    • This article is republished from The Conversation under a Creative Commons licence
    Add TechCentral as a preferred source on GoogleFollow TechCentral on Google NewsGet breaking news on WhatsApp


    Alison Gillwald Competition Commission Cyril Ramaphosa top
    WhatsApp YouTube
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleTech festival SXSW is cancelled
    Next Article Coronavirus: Second South African case confirmed

    Related Posts

    South Africa's car exports face an EV reckoning

    South Africa’s car exports face an EV reckoning

    25 September 2026
    Visa crackdown is latest US blow to South Africa ties - Marco Rubio

    Visa crackdown is latest US blow to South Africa ties

    16 September 2026
    South Africa is behind its neighbours on the plumbing of digital IDs

    South Africa is behind its neighbours on the plumbing of digital IDs

    11 September 2026
    Company News
    The Courier Guy enhances customer engagement with Telviva

    The Courier Guy enhances customer engagement with Telviva

    23 September 2026
    Pinnacle takes its channel to Mauritius for TechScape 2026

    Pinnacle takes its channel to Mauritius for TechScape 2026

    23 September 2026
    Why true customer enablement starts on the inside - Backspace Technologies COO Graeme Thomson

    Why true customer enablement starts on the inside

    23 September 2026
    Opinion
    Regulating AI: apply the laws we have first - Dirk de Vos

    Regulating AI: apply the laws we have first

    21 September 2026
    The end is nigh, and the shares go on sale in October - Duncan McLeod

    The end is nigh, and the shares go on sale in October

    14 September 2026
    The fragile joint in the Capitec machine - Pambos Soteriades

    The R197-billion market the banks can’t reach

    25 August 2026

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Latest Posts
    Woan's ghost exorcised - Solly Malatsi

    Woan’s ghost exorcised

    25 September 2026
    Eskom's profit doubles even as it sells less electricity - Mteto Nyati

    Mteto Nyati to stay on as Eskom chairman

    25 September 2026
    Meta's new gadget is a pocket watch for its viral AI agent - Muse Charm

    Meta’s new gadget is a pocket watch for its viral AI agent

    25 September 2026
    Insurers carry the can for MIP breach, regulators say

    Insurers carry the can for MIP breach, regulators say

    25 September 2026
    © 2009 - 2026 NewsCentral Media
    Built and maintained by Chronon
    • Cookie policy (ZA)
    • TechCentral – privacy and Popia

    Type above and press Enter to search. Press Esc to cancel.

    Manage consent

    TechCentral uses cookies to enhance its offerings. Consenting to these technologies allows us to serve you better. Not consenting or withdrawing consent may adversely affect certain features and functions of the website.

    Functional Always active
    The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
    Preferences
    The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
    Statistics
    The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
    Marketing
    The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
    • Manage options
    • Manage services
    • Manage {vendor_count} vendors
    • Read more about these purposes
    View preferences
    • {title}
    • {title}
    • {title}
    🇿🇦 Sign up to the TechCentral newsletter