A comparative investigation of concentrated ownership, regulatory failure and the selective use of sovereignty arguments to protect a rent-extracting telecommunications system.
Editorial Analysis | November 2026
Zimbabwe’s telecommunications pricing deserves investigation as an economic and institutional problem rather than another routine discussion about national infrastructure deficiencies. The persistent affordability question concerns the distribution of economic power throughout the telecommunications value chain. Consumers purchase data through retail operators whose underlying infrastructure, international connectivity and regulatory obligations involve several interconnected commercial institutions. Consequently, the final retail price reflects considerably more than the technical expense of transmitting digital information. Understanding that distinction requires examining the economic architecture through which connectivity becomes a commercial product.
The comparison with Zambia and Botswana introduces an important analytical difficulty for Zimbabwean policymakers. All three countries operate within a regional environment characterised by infrastructure constraints, international connectivity dependencies and varying degrees of economic vulnerability. Zimbabwe’s geographical position certainly imposes logistical costs associated with international connectivity and terrestrial fibre transportation. However, Zambia also operates as a landlocked economy, making geographical explanations insufficient when considered independently. Rwanda and Uganda, both landlocked and significantly poorer than Zimbabwe in per capita terms, offer data at $0.55 and $1.11 per gigabyte respectively. Botswana provides another useful comparison because its regulator has undertaken a formal examination of telecommunications service costs and approved revised pricing arrangements. These examples demonstrate that institutional decisions influence affordability alongside geographical and technological conditions.
Zimbabwe’s official telecommunications statistics provide an appropriate starting point for examining the underlying market. According to POTRAZ’s fourth-quarter 2025 sector performance report, Econet Wireless controlled approximately 73.75 per cent of active mobile subscriptions. NetOne occupied a substantially smaller position, while Telecel remained commercially marginal. The concentration becomes considerably more revealing when examining actual mobile internet consumption. Econet accounted for approximately 81.20 per cent of mobile internet traffic during that reporting period. NetOne accounted for approximately 18.69 per cent, leaving Telecel with a negligible proportion. These figures demonstrate that Zimbabwe’s mobile telecommunications market contains several licensed operators without equivalent competitive influence.
Such concentration matters because telecommunications competition depends upon effective alternatives rather than operator numbers alone. Consumers require credible alternatives offering comparable coverage, network reliability, speeds and affordable data packages. A competitor unable to match the dominant operator’s infrastructure cannot exert equivalent downward pressure upon retail prices. Market concentration consequently creates conditions under which price competition may become less effective. This does not establish monopolistic abuse or prove coordinated commercial behaviour. It does, however, provide a credible economic explanation requiring regulatory investigation.
The international connectivity market introduces another significant concentration problem. POTRAZ reported that Liquid Intelligent Technologies controlled approximately 68.10 per cent of Zimbabwe’s equipped international internet bandwidth capacity during the fourth quarter of 2025. TelOne accounted for approximately 11.55 per cent, while African Fibre Networks increased its share to approximately 13.62 per cent. The remaining providers controlled comparatively small portions of available capacity. These statistics concern equipped capacity rather than actual wholesale purchases or final bandwidth expenditure. Nevertheless, they identify a market structure in which access to international connectivity remains substantially concentrated.
The historical relationship between Econet Wireless and Liquid Intelligent Technologies deserves particular scrutiny. Freedom House’s 2024 Zimbabwe report identified Liquid as an Econet subsidiary and documented its substantial international bandwidth position during 2023. That historical corporate relationship should not automatically substitute for verification of the present ownership structure. Nevertheless, the relationship raises legitimate questions concerning vertical integration, wholesale access and competitive neutrality. An operator with significant retail market power operating within a broader corporate environment containing major connectivity infrastructure creates important regulatory questions. Regulators should establish whether competing operators receive equivalent wholesale access, comparable commercial terms and transparent interconnection arrangements.
The central issue concerns the economic distinction between infrastructure ownership and infrastructure access. International bandwidth represents an essential input into telecommunications services, particularly where domestic content delivery infrastructure remains underdeveloped. An operator controlling substantial wholesale capacity may enjoy commercial advantages unavailable to smaller competitors. Such advantages could arise through purchasing economies, preferential commercial arrangements or infrastructure integration. However, ownership concentration alone cannot establish discriminatory pricing or abusive conduct. Establishing such conduct requires wholesale contracts, audited transfer pricing, comparable bandwidth quotations and documented evidence concerning access conditions.
Zimbabwe’s international connectivity statistics also complicate simplistic explanations about geographical disadvantage. POTRAZ recorded approximately 1.69 million megabits per second of equipped international incoming bandwidth capacity during the fourth quarter of 2025. That capacity increased by approximately 6.46 per cent compared with the preceding quarter. Used incoming international capacity also increased during the same reporting period. The country therefore possesses multiple international connectivity arrangements and expanding available capacity. These developments do not establish that bandwidth is inexpensive, because capacity availability and wholesale purchasing costs represent different economic variables. They nevertheless make international bandwidth expenditure an essential subject for independent verification.
Electricity shortages, currency instability and infrastructure replacement costs remain legitimate explanations for part of Zimbabwe’s telecommunications expenditure. Mobile networks require electricity, batteries, generators, transmission equipment and continual maintenance. Currency depreciation can increase replacement costs where network equipment, software licences and specialist components require foreign currency. Furthermore, operators maintaining extensive rural infrastructure must recover expenses across relatively limited revenue-generating populations. These economic pressures deserve recognition because commercially unsustainable telecommunications networks eventually undermine investment and service quality. However, comparable operators in South Africa, Nigeria and Kenya face similar energy constraints without retail prices approaching Zimbabwe’s levels, which suggests that energy costs alone cannot explain the scale of the affordability gap.
Acknowledging legitimate expenditure does not settle the question of retail pricing. The decisive missing information concerns the relationship between actual costs, revenue generation and the final consumer tariff. POTRAZ’s fourth-quarter 2025 report recorded mobile operator revenue of approximately ZWG7.74 billion against operating expenditure of approximately ZWG4.64 billion. The resulting operating cost-to-income ratio approached 59.95 per cent. This ratio indicates substantial operating expenditure but does not independently establish net profitability. Capital expenditure, financing expenses, depreciation, taxation and other accounting considerations require separate examination. Aggregate sector statistics also conceal differences between individual operators.
A particularly important finding concerns the changing composition of telecommunications revenue. POTRAZ reported that mobile internet and data services contributed approximately 50.75 per cent of mobile network operators’ revenue during the fourth quarter of 2025. Data had consequently become the sector’s largest revenue-generating service category. Increasing reliance upon data revenue creates a commercial incentive to protect the economic value of existing customer relationships. Operators must balance attracting additional subscribers against preserving revenue per customer. Where competitive pressure remains weak, commercially attractive pricing may diverge considerably from socially desirable affordability.
The taxation argument requires similarly careful examination because its components frequently become conflated in public discussion. Telecommunications operators reportedly face VAT, airtime excise duty, annual regulatory charges, universal service contributions and other statutory obligations. In January 2026, industry representatives identified a 15.5 per cent VAT rate, 10 per cent airtime excise duty, 2 per cent monthly licence fee and 1.5 per cent Universal Services Fund contribution. These figures were presented by industry representatives rather than established through an independent audit of every consumer transaction. Their actual application across different telecommunications products therefore requires verification.
The economic significance of cumulative taxation extends beyond the percentage appearing on individual invoices. Taxes imposed on revenue, infrastructure imports and telecommunications equipment can influence investment decisions. Regulatory charges may also affect market entry, especially where prospective competitors face substantial initial licensing expenses. Zimbabwe’s historically reported mobile network licensing requirement reached US$137 million for twenty years. Such entry requirements can restrict the number of commercially viable competitors entering the market. However, licensing requirements must be examined alongside investment obligations, regulatory concessions and actual enforcement practices.
A regulatory environment can therefore produce an unintended contradiction between public revenue collection and digital inclusion. Government benefits from taxation and licensing revenue generated by telecommunications activity. Consumers, meanwhile, require affordable connectivity to participate effectively in education, commerce, financial services and international economic exchange. Operators require sufficient revenue to maintain networks and finance future investment. These interests are interconnected, although their institutional incentives differ substantially. Excessive fiscal extraction can ultimately undermine the very economic activity governments intend to tax.
Botswana provides a particularly revealing institutional comparison because its regulator adopted a different approach. BOCRA commissioned a comprehensive costing and pricing study covering wholesale and retail telecommunications services. Following consultation with industry stakeholders, the regulator directed operators to submit revised tariffs aligned with the study’s findings. Revised tariffs subsequently received regulatory approval during 2025, with further adjustments approved for Botswana Telecommunications Corporation during February 2026. The significance lies primarily in the methodology rather than any simplistic claim that Botswana possesses universally cheaper telecommunications services. Its regulator attempted to establish the underlying cost structure before intervening in retail pricing.
Zambia offers a complementary comparison concerning competitive incentives. A GSMA policy report published in October 2024 characterised Zambia’s mobile telecommunications market as highly competitive. The report associated competitive pressure with comparatively low average revenue per user and operators’ willingness to introduce targeted promotional offers. Such commercial behaviour can produce lower effective prices because operators compete directly for subscribers and consumption. The report represents an industry association’s assessment, rather than an entirely independent regulatory investigation. Nevertheless, its description identifies a recognisable economic mechanism through which competition influences affordability.
The comparison reveals an important difference between regulatory philosophies. Zambia’s documented experience emphasises competition as an instrument for constraining retail prices. Botswana’s regulatory intervention emphasises independent costing and price supervision. Zimbabwe’s publicly available evidence does not demonstrate an equally transparent combination of these mechanisms. Consequently, consumers remain dependent upon a pricing system whose underlying wholesale costs, individual operator margins and complete fiscal incidence remain difficult to establish independently.
The methodological disagreement surrounding Zimbabwean data prices further complicates public accountability. Freedom House documented a significant dispute between independent price comparisons and POTRAZ’s official assessment. One international comparison attributed an average price of US$43.75 per gigabyte to Zimbabwe during September 2023. POTRAZ disputed that figure and reported an alternative average of approximately US$3.21 per gigabyte. These figures should not be treated as directly comparable measurements without examining their respective methodologies. Differences in bundle size, validity periods, promotional discounts, purchasing conditions and currency conversion can substantially alter international rankings.
The methodological disagreement nevertheless exposes a regulatory weakness. Consumers cannot independently assess affordability when the regulator and external researchers employ different measurement systems. A reliable comparison requires standardised monthly baskets, transparent exchange-rate assumptions and consistent treatment of promotional products. It should also distinguish prepaid retail prices from postpaid contracts and fixed wireless packages. Affordability must additionally account for household disposable income rather than relying exclusively upon nominal international dollar comparisons.
The political economy of this arrangement deserves consideration because telecommunications infrastructure occupies an increasingly strategic position within national development. Governments depend upon telecommunications for revenue collection, financial transactions, public administration and information management. Large operators simultaneously depend upon government decisions concerning licensing, spectrum allocation, taxation and infrastructure permissions. Regulators therefore operate within relationships involving substantial commercial and political interests. Such institutional interdependence does not establish corruption, but it creates conditions requiring stronger transparency and independent oversight.
The question of deception should consequently be approached through observable institutional conduct. Public explanations emphasising electricity shortages, foreign currency constraints and international bandwidth expenses contain legitimate economic elements. However, those explanations become incomplete when institutions cannot demonstrate the actual contribution of each expense to retail prices. Repeatedly invoking operating difficulties without publishing independently audited cost structures risks converting explanations into instruments of institutional insulation. The distinction concerns verifiable accountability rather than speculation about secret agreements.
A further concern involves the distribution of economic advantages throughout the telecommunications value chain. International connectivity providers, fibre infrastructure owners, mobile operators, equipment suppliers and regulators occupy different positions within the same commercial ecosystem. Each institution seeks to protect its revenue streams and bargaining position. Consumers, however, possess limited information concerning the contractual arrangements determining their final purchasing costs. Information asymmetry therefore weakens the ability of consumers and smaller competitors to challenge existing commercial arrangements.
The strongest investigation would examine wholesale bandwidth contracts, related-party transactions, infrastructure-sharing agreements and spectrum allocation decisions. Particular attention should examine whether wholesale prices charged between associated companies reflect independent market conditions. Regulators should also compare the prices offered to affiliated businesses against those available to competing internet service providers. Such investigations would establish whether vertical integration produces genuine efficiencies or creates opportunities for economic rent extraction. Until these records become available, conclusions about abusive transfer pricing must remain provisional.
A realist interpretation provides another dimension to the problem. Telecommunications operators pursue commercial survival, shareholder returns, market share and strategic control over infrastructure. Governments pursue fiscal revenue, regulatory authority, employment, political stability and national connectivity objectives. These interests can overlap without requiring a formal agreement between the participants. A government may tolerate concentrated market structures because established operators provide reliable tax receipts and maintain expensive national infrastructure. Operators may simultaneously accept substantial regulatory obligations while protecting commercially valuable market positions. Such arrangements can emerge through institutional bargaining rather than deliberate conspiracy.
Game theory helps explain how relatively high prices can persist under these circumstances. In a concentrated market, operators repeatedly evaluate whether reducing prices would generate sufficient additional customers to compensate for lower revenue per subscriber. Smaller competitors may lack the financial capacity to sustain prolonged price competition against dominant incumbents. Consequently, individual operators can rationally avoid aggressive pricing even without communicating with competitors. This outcome resembles tacit accommodation within an oligopolistic market, although proving unlawful coordination requires additional evidence. Government taxation can further reduce the commercial attractiveness of aggressive price reductions. The combined incentives can preserve expensive retail products despite the theoretical existence of several licensed operators.
A materialist interpretation directs attention towards ownership, infrastructure, capital accumulation and the distribution of economic surplus. Connectivity depends upon fibre networks, spectrum, electricity, international gateways, transmission equipment and financing. Ownership of these productive assets determines bargaining power throughout the telecommunications economy. Market concentration can therefore generate advantages extending beyond ordinary retail competition. The institution controlling critical infrastructure may exercise influence over the conditions under which other commercial participants operate. Consumers ultimately encounter these structural relationships through prices, package restrictions and limited alternatives.
The material analysis also exposes a weakness in conventional explanations based exclusively upon national poverty. Low disposable income certainly reduces affordability for Zimbabwean households. However, household poverty cannot independently explain the underlying price charged by telecommunications operators. A country can experience low incomes alongside competitively priced connectivity, provided institutional arrangements constrain production and distribution costs. Consequently, presenting poverty as the primary explanation risks confusing consumers’ ability to pay with operators’ reasons for charging particular prices.
The proposed expansion of Starlink introduces a further dimension requiring analytical clarity rather than reflexive deference to either incumbents or enthusiasts. Starlink is not a neutral commercial service delivering connectivity as a public utility. It is a privately governed satellite architecture controlled by a single foreign corporation with discretion over who connects, where, under what conditions and with what technical constraints. The Ukrainian experience demonstrated that access to Starlink terminals can be conditioned upon political concessions and strategic calculations rather than consumer demand. The Iranian experience demonstrated that satellite terminals can function as instruments of external influence during domestic unrest. These are documented uses of the architecture for purposes extending beyond consumer connectivity, and they establish that the sovereignty concerns raised by Zimbabwean regulators possess a legitimate evidentiary basis.
India’s regulatory approach provides an instructive comparison because Indian authorities have withheld full commercial approval pending resolution of lawful interception, data routing, gateway bypass and security compliance questions. These are the concerns of a state exercising legitimate authority over critical infrastructure, and they demonstrate that serious jurisdictions examine such questions before granting market access. The Zimbabwean state’s initial prohibition of Starlink usage, followed by subsequent licensing, reflects an awareness of these issues that cannot be dismissed as mere obstructionism.
The analytical difficulty lies in the selective application of sovereignty arguments. Incumbent terrestrial operators possess an obvious commercial interest in limiting a competitor capable of bypassing their infrastructure entirely. The language of national security can function as a commercially convenient shield against disruptive entry, and the timing of regulatory concern often correlates with competitive threat rather than with genuine security assessment. A state that invokes sovereignty to slow Starlink while simultaneously failing to enforce competition, transparency and cost-based pricing in the terrestrial market is not protecting sovereignty in any substantive sense. It is protecting a rent-extracting equilibrium under a patriotic idiom.
The level of institutional ignorance lies not in taking security risks seriously but in failing to apply equivalent analytical rigour to the terrestrial market. Genuine sovereignty in telecommunications would require demanding transparency in wholesale bandwidth contracts, enforcing infrastructure sharing, publishing cost-of-service studies and ensuring that regulatory decisions serve consumers rather than incumbents. Invoking sovereignty selectively to impede one competitor while leaving the existing market opaque and uncompetitive represents the preservation of institutional advantage rather than the defence of national interest.
The strongest explanation emerging from the available evidence concerns a structurally protected market rather than an established conspiracy. Zimbabwe combines concentrated mobile data consumption, substantial concentration within international bandwidth capacity, significant regulatory and fiscal burdens, macroeconomic instability and insufficiently transparent wholesale pricing. These conditions create an environment in which high retail prices can remain commercially sustainable. They also weaken the ability of consumers, independent competitors and public institutions to determine whether those prices accurately reflect underlying economic costs.
The word deception requires a further distinction because misleading public explanation and organised fraud represent different evidentiary categories. Available evidence supports criticism of incomplete explanations and inadequate public disclosure. It does not establish that government officials and telecommunications operators deliberately conspired to deceive consumers. Nor does it establish unlawful price-fixing by individual operators. The more defensible interpretation is that institutional incentives permit a pricing structure whose costs remain insufficiently scrutinised, while public debate concentrates upon explanations that are individually plausible but collectively incomplete.
The decisive test would involve an independently commissioned telecommunications cost study covering Zimbabwe, Zambia and Botswana. Such research should calculate the actual cost of delivering comparable quantities of mobile data under equivalent technical conditions. Researchers should examine international bandwidth procurement, domestic fibre transport, network electricity expenditure, equipment depreciation, spectrum charges, taxation and operator financing costs. They should also calculate operating margins using audited financial statements and disclose related-party transactions wherever applicable. The resulting evidence would distinguish legitimate operating expenditure from regulatory inefficiency and potential economic rent extraction.
POTRAZ should publish standardised retail price baskets alongside independently verified wholesale bandwidth benchmarks. Regulators should additionally disclose market shares across subscribers, traffic, international capacity and domestic infrastructure ownership. Competition authorities should examine whether access arrangements disadvantage independent internet providers or smaller telecommunications operators. Government should assess whether telecommunications taxation generates sufficient public revenue to justify its effect upon digital affordability. These measures would strengthen both commercial accountability and the long-term viability of telecommunications investment.
Zimbabwe’s digital economy cannot develop sustainably while affordable connectivity remains constrained by institutional arrangements that consumers cannot independently examine. Businesses require predictable data expenditure, while educational institutions require affordable access to international information networks. Agricultural producers, financial institutions and emerging technology enterprises also depend upon reliable digital infrastructure. Consequently, telecommunications affordability should become a central component of national industrial and economic policy rather than remaining an isolated consumer complaint.
The ultimate finding is that Zimbabwe’s expensive data problem appears most consistent with an interaction between concentrated infrastructure ownership, weak competitive pressure, substantial fiscal extraction and macroeconomic instability. These factors reinforce one another, creating commercially sustainable conditions for prices that may exceed what a more competitive and transparently regulated market could support. The available evidence does not establish a criminal conspiracy, but it places a substantial burden of explanation upon regulators and operators. Until independent cost accounting becomes publicly available, claims that Zimbabwean data prices simply reflect unavoidable operating expenses remain insufficiently demonstrated. The unresolved economic question concerns how much of the consumer’s payment finances genuine connectivity and how much reflects institutional advantages protected by an inadequately scrutinised market structure.
References
References
[1] Postal and Telecommunications Regulatory Authority of Zimbabwe (POTRAZ). (2026). Postal and Telecommunications Abridged Sector Performance Report: Fourth Quarter 2025. Harare.
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Editorial Evidence Note
The analysis distinguishes published regulatory statistics, institutional statements and analytical interpretations. POTRAZ’s sector report relies upon information supplied by telecommunications service providers. The GSMA assessment represents an industry association’s analysis rather than independent regulatory certification. Historical corporate ownership information should be updated against current company filings before publication. The available materials do not provide independently audited operator-level wholesale bandwidth costs, related-party pricing or complete retail profitability calculations. Those omissions prevent a conclusive finding of collusion or deliberate overcharging, while leaving substantial grounds for further investigation.