Mobile Internet prices falling in Papua New Guinea

By on 9 Apr 2024

Categories: Development Tech matters

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Vodafone sales outlet in Jiwaka Province. Photo by Moses Sakai.

After years of high prices for mobile data in Papua New Guinea (PNG), consumers are now able to access lower prices that represent better value.

Devpolicy Blog has been monitoring mobile Internet prices in PNG since the start of 2020. This post reports on research findings since the last update in April 2022 (previous updates are available).

From the beginning of May 2022, we have added an additional mobile network operator to our monitoring program. It launched in late April 2022 with ‘Vodafone’ branding and is run by Amalgamated Telecom Holdings, which is listed on the South Pacific Stock Exchange. Its entry into the PNG market was assisted by funding from the Asian Development Bank. We are now recording the prices offered by Telikom, Digicel, and Vodafone.

How do the offerings of the three mobile network operators compare? Table 1 shows the data rates offered by the three companies in January 2024. Telikom’s rates are similar to those of new entrant Vodafone in terms of value, or toea per megabyte (in PNG, there are 100 toea in a kina, with cent and dollar being roughly equivalent terms respectively). Digicel offers more choice and Digicel users typically need to select a high-end option to access a rate comparable to those offered by Telikom and Vodafone.

   1-day plan  3-day plan  7-day plan 30-day plan
Service Provider Most accessible Middle High end Most accessible Middle High end Most accessible Middle High- end Most accessible Middle High- end
Telikom 0.30     0.20     0.20   0.20 0.13 0.11 0.12
Digicel 1 0.50 0.15 0.33 0.25 0.20 0.40* 0.30* 0.25* 0.25* 0.20* 0.12*
Vodafone 0.30   0.17 0.23     0.20   0.19 0.13 0.12 0.10

Table 1 — Comparison of data rates as of January 2024 (toea per megabyte). *The Digicel plans marked with an asterisk offered bonus access to Digicel’s television service in January 2024 through a television application that could accessed on mobile devices such as smartphones or tablets.

The rates shown in Table 1 are substantially better in terms of toea per megabyte than the rates we presented in a similar table in July 2020. At that time, Telikom’s data cost 0.60 toea per megabyte for 1-, 3- and 7-day plans and their best-value offering was 0.50 toea per megabyte for a high-end 30-day data bundle. Digicel’s data rates at that time ranged from 7.50 toea per megabyte to 0.80 toea per megabyte. Therefore, it is clear that mobile Internet rates have improved in PNG since 2020.

However, unlike Telikom’s and Vodafone’s offerings, Digicel’s data plans now come with strings attached. Between 73% and 80% of the data purchased for each of the plans (1-, 3-, 7-, and 30-day) is only valid to be used from 06:00 (UTC +10) to 18:00 (UTC +10), with the balance able to be used at any time of the day.

Although Digicel’s data prices have dropped, we feel that these time-of-day restrictions place their customers at a disadvantage. They create an additional mental load for users and require them to monitor their own behaviour, thus continuing what anthropologist Robert J. Foster has referred to as Digicel’s tendency “to encourage personal responsibility for monitoring data usage”.

As can be seen in Table 1, users who can spend more upfront can purchase data at better value than users with less money at the time of purchase. We feel that such pricing structures, which have been adopted by all three telecommunication companies, place low-income users at a disadvantage.

The rates shown in Table 1 are those offered to prepaid users. We monitor prepaid services because the majority of mobile telephone connections in PNG are prepaid. Since April 2021, Digicel has offered a subscription service to prepaid users through its ‘REDclub’.

Under REDclub, data rates are similar to the ones provided by Telikom and Vodafone under their normal plans. However, to access plans under REDclub, Digicel users are required to subscribe for a week for 10 kina or a month for 20 kina. REDclub data plans do not have time-of-day conditions attached. Telikom and Vodafone do not offer subscription services.

Overall, our research has shown that all three mobile network operators have decreased their prices.

This is welcome news for mobile phone users in PNG. Nonetheless, it is worth acknowledging that some offerings remain unattainable for certain citizens. For example, people who live a subsistence lifestyle, operate in the informal economy, or sustain themselves through insecure employment may not be able to afford REDclub subscription fees. Similarly, families in urban areas with high housing costs and other expenses may not be able to buy the data plans that represent the best value.

The Coral Sea Cable System (CS2) launched in December 2019 and the Kumul domestic Internet cable completed early in 2020 were expected to improve access to the Internet and reduce Internet pricing in PNG. In their first few years of operation, the cables appeared to have had no positive impact on mobile Internet prices, as was shown by our earlier updates.

The entry of a new company into PNG’s mobile market in 2022 appears to have had a demonstrable impact on the mobile Internet rates offered by the two existing mobile network operators. It is unclear whether the purchase of Digicel’s Pacific operations by Australian company Telstra had any bearing on Digicel PNG’s pricing structures.

While there are multiple factors at play, such as the regulation of wholesale prices, it seems that the introduction of additional competition may have done more for the budgets of consumers than the earlier introduction of cable systems. However, we acknowledge that the price decreases could have been caused by something else, or a combination of factors, and we cannot be sure of the cause.

Detailed analysis and graphs showing the prices offered by the three mobile service providers over time can be found online.

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The views expressed by the authors of this blog are their own and do not necessarily reflect the views of APNIC. Please note a Code of Conduct applies to this blog.

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