If you’ve been following the news, you must have heard that the Minister of ICT has announced that as from 1st December 2011, the price of Orange ADSL will decrease by around 10% (VAT inclusive).

• Orange ADSL 256K 3GB – Rs 399 to Rs 349
• Orange ADSL 512K – Rs 759 to Rs 699
• Orange ADSL 1M – Rs 899 to Rs 799
• Orange ADSL 2M (new!) - Rs 1349
• Orange ADSL 4M (new!) - Rs 2349

Une baisse de 12% à 46% sur les tarifs ADSL Home et de 50% sur l’ADSL Business dès le 1er décembre. C’est ce qu’a annoncé le ministre des Technologies de l’Information et de la Communication (TIC), ce vendredi 25 novembre, lors d’un point de presse à son ministère.

Comme l’avait déclaré récemment Tassarajen Pillay Chedumbrum lors du lancement du nouveau portail du gouvernement, la réduction des tarifs d’Internet prendra effet à partir du 1er décembre prochain. Ainsi, les nouveaux tarifs de l’ADSL Home de 256K passeront de Rs 399 à Rs 349, avec une baisse de 12%. Ceux de l’ADSL Home de 512K seront à Rs 699 au lieu de Rs 759. Pour le débit de 1 Méga, les tarifs seront de Rs 799 avec une réduction de 46%.

Pour les entrepreneurs, le prix de l’ADSL Business connaîtra une baisse de 50%. Alors que pour les centres d’appel et les sociétés évoluant dans le secteur BPO, les tarifs enregistreront une réduction de 10 à 46%. Tous les  nouveaux tarifs  seront  effectifs à partir du  1er décembre 2011.

TassarajenPillay Chedumbrum explique que toutes ces baisses ont pu devenir une réalité grâce à l’Open Access Policy to Sea Cable. «Les opérateurs n’auront plus à prendre des bandes passantes uniquement auprès de Mauritius Telecom. Bientôt, Emtel pourra également commencer à vendre ses bandes passantes », explique le ministre des TIC.

De plus, celui-ci affirme qu’une baisse de 50% sur l’ADSL Business vise à encourager les Petites et Moyennes Entreprises. Tassarajen Pillay Chedumbrum soutient que l’objectif de son ministère est de faire que le secteur des TIC devienne le second pilier de l’économie, avec une contribution de 8% au Produit Intérieur Brut (PIB).

Le ministre estime, par ailleurs, que les bandes passantes qui connectent Maurice à l’étranger seront plus accessibles.« Nous voulons briser le monopole détenu par Mauritius Telecom, et ainsi créer un environnement favorable à l’investissement », soutient-il.

S’agissant de My.T, ce service de Mauritius Telecom permettant à la fois de téléphoner, de visionner les films et de surfer sur Internet, il n’y aura aucune réduction des tarifs.

Source – L’Express.mu

There are no decreases for My.T (at least not yet). New My.T prices updated at the bottom of the post.

But wait… where did that 1Mbps ADSL come from?!?

 

To explain this, we need to go back to a month ago when…

The Competition Commission of Mauritius (CCM) had launched an investigation on the monopoly of Mauritius Telecom on Internet in Mauritius, specifically concerning its anti-competitive My.T offer. Hence, they had invited all Internet users to come forward with their complaints.

Here is the press release. The pdf can be downloaded here.

INFORMATION GATHERING FROM MEMBERS OF THE PUBLIC IN THE INVESTIGATION OF MAURITIUS TELECOM IN RELATION TO ITS MYT INTERNET ACCESS BUNDLING

The Competition Commission of Mauritius (CCM) has launched an investigation into Mauritius Telecom’s offering of the My.T product on the 21st February 2011. The Statement of Issues, a document which outlines the main areas of concern at the preliminary stage of the Investigation has been issued to Mauritius Telecom.

Following the Statement of Issues, the Executive Director of the CCM wishes to invite comments or representations from members of the public to gather further information and evidence on the concerns which may or may not lead to an eventual finding of breach of the Competition Act. Comments or representations should be made by November 04th by contacting the CCM. The issues on which the public may comment are as follows:

• Market definitions for further analysis of the conduct in each relevant market which have at present been defined as
  i. the market for fixed line retail broadband access
  i. the market for Pay TV
  ii. the market for ILD (International Long Distance) calls
  
• The effects of MT’s tying and bundling conduct on competition in these markets, particularly the Pay TV market;

Dr Sean Ennis, Executive Director of the CCM, has stated: “The My.T package mixes together broadband internet – a product in which MT has a monopoly - with products such as international calls and TV services, in which it competes with other companies. Such packages might be in the interests of vigorous competition and convenient for customers. But if customers are unduly influenced towards buying TV services from MT, just because of its broadband monopoly,that could damage competition in those markets.”

The investigation is continuing. It is being carried out under the “monopoly situations” provisions of the Competition Act. The next step is the preparation of the report by the Executive Director. After that report, if the Commission finds that MT’s actions have the object or effect of “restricting, preventing or distorting competition”, then the Commission can impose remedial measures on MT. Whatever the outcome, there is no possibility of any financial penalties being levied in this case, as these relate only to collusive agreements between several competing companies.

The Executive Director emphasised “The fact that a Statement of Issues has been communicated to MT should not be construed as conclusive findings or as a determination that MT is in breach of the Competition Act. At this stage, no such determination has been made. Any determination as to possible breaches can only be made at the stage of provisional and final report of investigation.”

The Executive Director will endeavour to the fullest extent possible to respect anonymity of any individual providing information in the context of this investigation and/or to protect any confidential information any person or any company may provide at the request of that individual.

The Competition Act
The Competition Act 2007 came fully into effect on November 25th 2009, and is enforced by the Competition Commission of Mauritius, the CCM. Sub-parts II and III of Part III of the Competition Act 2007, cover restrictive practices described under ‘Other restrictive agreements’ and ‘Monopoly situations’.

To take action, the CCM must find that the conduct of an enterprise in a monopoly situation restricts, prevents or distorts competition or otherwise exploits the monopoly situation. We refer to such conduct as ‘abuse of monopoly’. Where the Executive Director has reasonable grounds to believe that abuse is occurring, or will occur, he may launch an investigation.

Monopoly abuse: It is not in itself any breach of the law for an enterprise to be in a monopoly situation. However, as per Section 46(2) of the Competition Act, enterprises which hold monopoly positions may be in breach of the abuse or exploit any market power this position confers upon them. The question for the CCM is whether such enterprises are engaged in conduct which restricts, prevents or distorts competition (such as using their market position to exclude rival enterprises) or otherwise exploiting the monopoly situation. This is sometimes termed ‘foreclosure’.

Anticompetitive foreclosure may arise through ‘bundling’: the packaging together of two or more products. If the sale of one product is conditional on the sale of another, the products are said to be ‘bundled’ or ‘tied’ together (the former term is normally used when neither product can be bought separately).

Tying and bundling are normal business practices that are not by any means necessarily anticompetitive. Many products are sold jointly, or in varying combinations. However, in some cases bundling might be used anti-competitively. If an enterprise has market power in the sale of one product (for example a 100% market share), but sells another in more competitive markets, then it might ‘leverage’ market power to reduce competition in the second market. To the extent customers have to buy the monopolized (tying) product, they are forced in effect to buy the other (tied) product, reducing the sales of competitors for that second product.

The CCM takes the view that, in most markets, free competition is an effective guarantor of the interests of consumers and is likely best to promote the efficiency, adaptability and competitiveness of the economy of Mauritius. Significant weakening of competition will therefore have adverse effects.

If it finds a breach of the monopoly provisions of the Competition Act, following an investigation, the Commission has the power to force sales of assets or businesses, or require changes in company behaviour, to remedy the situation.

Further information: For further information see the CCM’s website at www.ccm.mu, and the CCM’s Procedural Rules and Guidelines: ‘CCM 1 - Procedural Rules’, ‘CCM 4 - Monopoly situations and non-collusive agreements’ and ‘CCM 6 - Remedies and Penalties’, all available on the web site.

L’Express - Enquête sur l’offre MyT : La Competition Commission invite le public à déposer

Eventually, the date for submission was extended from the 4th Nov to 18th Nov & along with several other Internet users, we submitted a document to the commission, where the following points were raised.

 

Monopoly?

The Act defines a ‘monopoly situation’ where any one company has a 30% market share.

Does Mauritius Telecom have more than 30% share of the ISP market in Mauritius? Obviously yes.

But the admins over at the Facebook page of Orange Mauritius want you to believe otherwise. Quoting:

“First of all, Orange Mauritius is not in a monopoly situation as the liberalization of the telecommunication sector in Mauritius is effective since 2004. There are several other Internet Service Providers in Mauritius.”

So let’s see how they are taking undue advantage of their monopoly status, starting with…

 

I. Fixed line retail broadband access

There are only a handful of ISPs in Mauritius – Mauritius Telecom/Orange Mauritius, Emtel, Nomad (RIP) and MTML. As of 2010, there are 284,200 Internet subscriptions in Mauritius (ICTA, 2010). Out of the 271,400 broadband subscriptions, 93,900 are fixed line & 177,500 are mobile.

As we all know, wireless broadband doesn’t come cheap. The speed is not constant & the usage is not unlimited.

Orange (EDGE, 3G, HSUPA – up to 7.2Mbps)

Mobile Internet (prepaid)

• 20MB – Rs 50
• 50MB – Rs 100
• 200MB – Rs 200
• 1 GB – Rs 499
• 3 GB – Rs 999
• 5 GB – Rs 1299
  Excess at PAYG rate of Rs 3.53/MB.

Internet Everywhere (with modem & monthly tariffs as above)

• Post-pay - Rs 1999 (excess Rs 2/MB)
• Prepay - Rs 2999 (excess Rs 3.53/MB)

Emtel (3G, HSUPA – up to 7.2Mbps)

Prepaid Web (PAYG at Rs 3/MB)

• 500MB – Rs 350
• 1 GB – Rs 480

Mobile Broadband (monthly tariffs, modem at Rs 1990)

• 1 GB – Rs 459
• 2GB – Rs 861
• 5GB – Rs 1724
• 10GB – Rs 2874
  Excess at Rs 2.25/MB

MTML (CDMA, EVDO – up to 2.4Mbps)

Azu Broadband (monthly tariffs, modem at Rs 4542)

• 1 GB – Rs 344
• 2 GB – Rs 631
• 5 GB – Rs 1379
• 12 GB – Rs 2300
  Excess at Rs 0.80/MB

& that’s why more than 90,000 people have chosen ADSL. Except, they didn’t really have to chose since there is only one ISP which provides ADSL services to the public – Mauritius Telecom.

ISPs that have tried to compete with MT were already at disadvantage because

1. they had to pay MT for using the SAFE cable (until 2011 when the Open Access Policy came in, SAFE access was being solely regulated by MT),
2. they had to setup their own wireless networks while MT already had its own wired network, and
3. they couldn’t wage a price-war while remaining profitable as MT could always beat their prices.

DCL & Mauripost have all gone out of business, Nomad is on life-support with the handful of customers still with it, MTML failed because of mismanagement and Emtel still haven’t launched their Wimax services (reputed very reliable) for the public.

This Microsoft-like monopoly has allowed Mauritius Telecom to set any price that suits them.

Orange ADSL

• 256k – 3GB – Rs 399 (excess at Rs 0.58/MB)
• 512k – Unlimited – Rs 759

My.T

• 1M + TV – Rs 999
• 2M + TV – Rs 1699
• 4M + TV – Rs 2999

As you can see, there's no ADSL 256k unlimited, no ADSL 1M, ADSL 2M, ADSL 4M or any My.T with no TV options.
(There was an ADSL 1M at Rs 1353 only for existing 1M users before the speed double, but all of them have migrated to My.T)

If you phone MT's customer care, & ask them why there's no ADSL 1M, they'll tell you that My.T is a package & you either take it or you're free to go to their (inexistent) competitors.

In fact, by bundling additional (non-optional) services, MT can demand more money from subscribers. & because customers are only concerned with the Internet connectivity, they are forced to pay for these unwanted services.
In short, a blatant abuse of monopoly.

It's like using those AC buses where they make you pay extra. You don't want the AC, you don't want to pay additional fare for it, but you have to because that's the only bus that goes through your destination. Your other choices are to either walk or buy a car.

In their pursuit for more profits, MT have also stranded thousands of users who want faster speeds. By making 1Mbps & 2Mbps connections only available to My.T subscribers, they effectively prevent people who live far from a DSLAM (the exchange) from moving up from 512k connections.

The maximum range for an ADSL2 connection is 3km & the attenuation should be less than 42dB. Given that My.T also requires at least 5Mbps of bandwidth, it leaves many users ineligible for an upgrade. Their only hope is to wait for FTTC to be installed in their region.

Now if Orange ADSL was available at 1Mbps or 2Mbps, all these users would have been satisfied.

 

II. Pay TV

Another malpractice of MT is the bundling of IPTV channels on My.T. Using their Internet monopoly, MT force their TV channels on customers. Many users already have a separate satellite subscription from CanalSat, Parabole Maurice or DSTV, which makes most of the My.T channels redundant. So they're paying extra for a service they already have. Not to mention that the quality of IPTV is largely inferior to satellite TV & is network dependent (no ADSL connectivity = no TV).

My.T Core Bouquet (27 channels) - FREE

• Info: CNN, NDTV Profit, NDTV 24x7, France 24, CCTV, NHK World, Bloomberg TV.
• Kids: Boomerang, Gulli, Boing, Kidsco.
• Music: Hungama, MCM Tor, Clubbing TV.
• General: Reunion 1ere, France 2, France 3, France 5, France O, Ary Digital, Jaya TV, TCM.
• Lifestyle: Liberty TV, Fashion TV, Motors TV, NDTV Good Times, Yacht & Sail.

My.T Bollywood Bouquet - +Rs 250

• Star Plus, Star One, Star Gold, Imagine, Headlines Today

By bundling IPTV with My.T, MT gives less incentives for people to subscribe to satellite TV as the most basic of subscriptions start at Rs 450/month. & according to the above definition of bundling, that's unfair competition.

 

III. ILD (International Long Distance) calls

With every My.T subscription comes My.T Talk, an International Call service. You just need to call

< 320 2051 + country code + phone number >

Easy right? For the customers, yes. But other ILD operators simply can’t compete. First, it has made the Prepaid card completely obsolete. Who will go & buy a prepaid card if you can just dial a number from your telephone line?

Second, if you have to use another operator’s service directly from your telephone line (IDD), you first have to register with that operator. Emtel, Outremer Telecom & Easicall all require you to call on their office/showroom, present some relevant documents & fill up a form before you can subscribe.

Why would anyone go to such a pain for saving some extra cents when they can use My.T Talk? & that’s why it is uncompetitive, because Mauritius Telecom is leveraging the monopoly it has on Internet access to promote its own international call services.

 

So?

In all 3 of the above markets, MT are making a blatant abuse of their Internet monopoly. The CCM has every right to impose sanctions on MT. This investigation was expected to be completed by March 2012. Except, in the meantime, something has happened...

 

 

The Orange ADSL 1Mbps offer

On the 2nd of November, Orange Mauritius discreetly updated their Orange ADSL with a new option - 1Mbps.

Last year, they scrapped this offer & suddenly out of nowhere, it comes back. Did they pity the users? No, it’s because of the CCM. By adding this 1Mbps offer, Mauritius Telecom have effectively nullified half of our arguments.
Update: As I had long suspected, they've now added two new ADSL offers - 2Mbps & 4Mbps.

The new price grid looks like this now:

Orange ADSL

• 256k – 3GB – Rs 359 (excess at Rs 0.58/MB)
• 512k – Rs 699
• 1Mbps – Rs 799
• 2Mbps – Rs 1349
• 4Mbps – Rs 2349

My.T

• 1M + TV – Rs 949
• 2M + TV – Rs 1499
• 4M + TV – Rs 2499

A perfect price grid that is absolutely legal. Want TV, pay extra for it. Don't want it, choose ADSL. There are hardly any grounds for the CCM to investigate My.T now that customers have the choice. ALL users should be satisfied now...

Well, except if you are an old-time My.T 512K user… which I am. Last year I was cheated by Orange Mauritius, now I’m being extorted…
Let’s see. I pay Rs 750+VAT, which is Rs 864 & I get up to 512K & two channels. YES, ONLY TWO – Liberty TV & CCTV.
Now, I have no choice but to subscribe to ADSL 1Mbps & forego the crappy Livebox & the crappier 2Mbps local speed (which was 4Mbps since the past 3 weeks).

That’s what you get from being a monopoly situation. Absolute control of prices. Double the speeds but keep the same prices. No wonder they have a net profit of Rs 1.6 billion (pre-tax).

 

 

Why so slow?

Why is our internet still so slow? It’s not as if we are running out of bandwidth, are we?

If you at the above chart, the international bandwidth has increased nearly exponentially, so we clearly have more than enough of it.

 

The number of users hasn’t increased either. Even if you factor in the CyberTower sector, it doesn’t explain why we do not have 10Mbps connections.
Note that the total number of Internet subscribers includes mobile users (hence the large number) & that the 2010 numbers are estimates based on reported numbers.

 

The evolution of the price & the speed of Internet is not in line with the international bandwidth we have. If you notice it, the lowest pricing has always remained at around Rs 750. I think that’s what you’d call price-fixing…

Nevertheless, that doesn’t explain why our connections are slow. Why do we experience slowdowns every night, every week-end, every public holiday?

To find out, I did some speed tests with the local server at Port Louis.

Test at 15:32, during the day. Full 4Mbps local.

6pm. Drops down to 1300kbps.

19:40. 354kbps local speed.

The next day, at 06:44 – 4.2Mbps.

So what we can conclude is that at night, as more subscribers use their broadband connections, the speed drops.

But the real metric is the ping test. At night, it’s nearly 8 times higher. The ping test determines the connection latency, the time it takes for an IP packet to travel from your computer to the speed server. If there are more packets on the network, the longer will be the delay.

& the reason why our connections are so slow is because the local infrastructure is inadequate. Our kilometres of copper cabling have become completely obsolete. It simply cannot cater to the ever-increasing internet connection speeds.

It’s as if for years you’ve been using an ox-cart (local connectivity) being pulled by a ox (international bandwidth). Which was then upgraded to a donkey, then a horse, pulling the cart. & now we have a car. Except that it’s still pulling that same ox-cart.

Unless every single region in the country is served by fibre, we will still have these problems. Who to blame? MT for its short-sightedness in not predicting this situation & starting the deployment of its FTTC network only three years ago.

& why did we have come to this situation? Once again, because of the monopoly…

 

Update 28.11.2011:

Orange ADSL

MT have updated their Orange ADSL page with the new prices, taking effect as from 1st December 2011.

Orange ADSL	Old Price	New Price
256k 3GB	Rs 399	Rs 349
512k	Rs 759	Rs 699
1M	Rs 899	Rs 799
2M		Rs 1349
4M		Rs 2349

Well, surprise, there are new 2Mbps & 4Mbps offers… If you have read about the CCM above, you’ll know why these offers have magically appeared! :)

 

My.T

My.T prices have also decreased.

My.T	Old Price	New Price
1M	Rs 999	Rs 949
2M	Rs 1699	Rs 1499
4M	Rs 2999	Rs 2499

So that’s it. Let’s all move to ADSL! :)
After 4 years of suffering My.T, Mauritian users can finally enjoy an Internet-only connection. Note that there's only Rs 150 difference between the My.T & ADSL packages (plus the local speed of 2Mbps/4Mbps).

 

 

Update 30.11.2011

A few more information which I gathered from Orange Mauritius’ Facebook page.

My.T 512k

If you are a My.T 512k – no TV user (i.e. with only 2 TV channels), the price decrease is from Rs 848 to Rs 799. Given that I’m getting double the speed, 1Mbps, on ADSL, there’s no point staying on my My.T 512k, paying the same price. Well, except…

 

My.T to ADSL?

If you’re moving from My.T to ADSL, there’s a line conversion fee of Rs 1000. Plus, you get a non-wifi modem.
& if you’re upgrading from the same package (My.T to My.T, ADSL to ADSL), it’s free. Otherwise, you have to pay. Brilliant!

 

Related:

• Yashvinblogs.com - Competition Commission invites the public to comment on myT packages
• Yashvinblogs.com - Price of ADSL goes down but not that of myT
• Mauritius Information - The Internet in Mauritius sucks and Mauritius Telecom does not care
• Orange - MT annonce des baisses de tarifs et de nouvelles offres internet