A Case for Non-Expiring Mobile Data in Botswana

The other day, I had a sudden electricity cut while doing some work on the internet. My primary source of internet is an unlimited broadband connection from a local ISP, so as a result of the power cut, I bought a 1-day mobile data bundle so I could continue working. Lo and behold, a few minutes after dropping a couple of pulas on the bundle, electricity came back, and I was stuck with a few GBs of mobile data, which I had no use for but would be expiring in a few hours.

That got me thinking, why does mobile data even expire if, for starters, I have already paid full price for it, and secondly, it's not a perishable product?

According to a study by Cable.co.uk, Botswana ranks 161 out of 231 countries regarding affordable mobile data prices. The study further shows that of the 22 mobile data plans studied from different carriers in the country, the average price for 1GB of mobile data was $1.99 (P27). For context, the lowest average price in Sub-Saharan Africa was found in Malawi, with an average cost of $0.38 (P5) for 1GB. 

Despite the already high cost of data in the country, most internet service providers still sell packages whose data "expires". This means that if a customer, for example, buys a 1GB package for a day and after the end of 24 hours, they have used none of it, it's pretty much their loss.  For a country already battling to provide access to the internet for the underprivileged, this is counterproductive.

Internet Service Providers (ISPs) argue that the reason mobile data expires is because of a telecommunications principle called "breakage". Simply put, breakage refers to any type of service which is unused by the customer. In the case of mobile data, ISPs design data plans to maximise the amount of expiry breakage that occurs. They offer plans that are right on the cusp of an average subscriber’s monthly usage to push you to buy more data than you really need.

This is because to serve mobile data to consumers, ISPs buy network capacity from their supplier (in this case, spectrum from BOCRA) and not data in GBs like end customers buy. For example, to serve 10 million people with a 1GB data bundle for a day, ISPs don't simply buy 10 million GB of data and add their profit margin. Instead, they buy a certain capacity, for example,  a 10Mbps line, which would allow consumers to access the internet. Because they know how many customers will be on that line and for how long, ISPs can calculate how much capacity will accommodate a certain number of users at both peak and low traffic periods.

As a result, ISPs argue that if data does not expire and is allowed to roll over, they would have to accommodate the worst-case scenario when all customers decide to use their data at one time, which would require large amounts of capacity. To pay for that extra capacity, they argue that they would have to pass the costs to consumers, making data prices astronomically expensive.

If the data is allowed to expire as is currently the case, if ISPs' research for example shows that the low tier of mobile data users consume 1GB of data a day, and the next tier consumes 5GB a day, they will offer those particular plans knowing that the capacity they bought can accommodate that traffic. If a customer specifically wants 3GB, well, tough, they would have to buy the 5GB package, and anything left will be lost. In short, it's a numbers game, and as always, consumers pay the price.

Additionally, "expiring" mobile data serves ISPs well in that it offers a predictable flow of revenues. ISPs can easily calculate the returns they expect from their infrastructure investment (buying capacity etc) if the service they provide, no matter how much of a daylight robbery it is to consumers, can be easily measured. But why should consumers suffer to appease ISP investors by being barred from accessing and using a service they have already fully paid for? This is where regulators like BOCRA should come in.

In South Africa, following years of customer complaints about expiring data, the Independent Communications Authority of South Africa (ICASA) proposed new regulations which imposed a minimum validity period of three years for mobile data. After pushback from telcos, the two parties settled on an agreement which will see telcos allowing customers to transfer their extra data to friends and family and also "roll over" data to the next period beyond what they subscribed for. For example, if a user bought a 10GB data package for a month but only used 5GB, the ISP will be required by law to allow the user to use at least 2.5GB of that leftover data in the next month.

ISPs will also be required by law to deplete bundles in order of earliest expiry. Previously, a user who activated a weekly data bundle after their monthly mobile data bundle would first have to consume all their monthly data before the weekly bundle could be used. With the revised consumption order, usage on the monthly bundle will stop until the weekly bundle is depleted. 

The new regulations also require telcos to inform customers about how much data they have left, which is a useful feature, especially for contract customers who are charged exorbitant "overage" fees if they go over the data limit of their respective plans.

This is what Botswana needs if the country is serious about bridging the internet accessibility gap, which currently persists. ISPs can argue about the technicalities of why they impose expiry dates on mobile data but the fact of the matter is that it all boils down to maximising profits at the expense of the consumer. The South African telecoms regulators and consumer protection bodies have shown that telcos can be made to take into consideration their customers in making data affordable.