Today’s edition
Priced Out
Good morning. South Africa is opening another inquiry into why data still costs what it costs, four years after the spectrum auction that was meant to settle it, and Zimbabwe is getting its first Hilton because a South African developer spent fifteen years making the case. Plus a couple other stories that will keep you locked and loaded for the day ahead. Let’s get into it.
MARKETS
SIGNAL FAILURE
Icasa is opening another inquiry into the price of data, a decade after the first one
Icasa is South Africa’s communications regulator, and it has just opened 2 separate inquiries into how South Africans use and pay for internet services. The first asks whether South Africans can actually afford services like mobile data and broadband. The second looks at what streaming and messaging apps are doing to the traditional companies Icasa regulates.
It comes 4 years after government auctioned off more spectrum, essentially giving mobile networks more airwaves to carry our calls and data. That was supposed to make networks cheaper to run, improve coverage and help bring data prices down. There has been progress since then, but clearly the affordability question has not gone away.
What the auction actually bought:
- In 2019, after a 2-year investigation, the Competition Commission found that mobile data pricing was particularly punishing for poorer South Africans.
- Since the 2022 spectrum auction, some mobile services have become relatively cheaper and networks have expanded their coverage across the country.
- But 4 years later, the affordability question remains. Icasa is once again asking whether South Africans can actually afford services like mobile data and broadband.
The second inquiry looks at a different problem. Services like Netflix now compete with traditional broadcasters like the SABC without operating under the same broadcasting rules. Icasa wants to understand what that shift means for the companies it regulates. For now, these are investigations, not new rules, so nothing is changing for Netflix, the SABC or your data bill just yet.
ROOM TO GROW
Hilton is finally opening a hotel in Zimbabwe, and a South African developer is building it
Hilton has been signing hotels across Africa for years without ever putting one in Zimbabwe. That changed at a property forum in Harare in late August, where the company announced a 140-room Hilton Garden Inn in the city’s Highlands district, its first in the country, due to open in early 2029. It will sit about 25km from Robert Gabriel Mugabe International Airport. Harare has fewer than 11,000 three- to five-star beds against an industry estimate of about 20,000 needed, and this is the first significant hotel development the city has seen in years.
The building is somebody else’s job. The hotel goes up inside the Highlands Precinct, a mixed-use scheme of offices, retail, homes and conference space belonging to Terrace Africa, a Harare and Johannesburg firm founded in 2011 by the South African developer Brett Abrahamse, who was 28 when he pointed a property company at a country most international money had spent two decades avoiding. Terrace has delivered more than US$230 million of projects across four countries and listed Zimbabwe’s first traded property fund in 2022. Neither side will say what the agreement is worth.
Hilton is bringing the name. Terrace Africa carries the building for another three years, and the 140 rooms cover a small part of the gap when they open.
BAGEL BITE
What is the fastest animal in the world?
A. Peregrine falcon
B. Golden eagle
C. Common swift
DOING THE ROUNDS
Sun International’s casinos are growing again, but the company is cutting jobs anyway. The Sun City owner has opened formal retrenchment talks across its smaller casinos, marketing and technology teams, and parts of head office, although it won’t say how many of its 7,222 staff could be affected. The cuts come as casino income rose 1.5% in the half, its first growth in 3 years, while the board also lifted its interim dividend by 7.6%. Full story →
Onderstepoort Biological Products imports foot-and-mouth vaccine and sells it to South African farmers, and it isn't supposed to profit doing it. Agriculture Minister Willie Aucamp put pricing allegations to its board on Friday, and it gave acting chief executive Jacob Modumo 5 days to answer. GroundUp reports it bought doses from an Argentine supplier at 45 rand and sold them on at close to 3 times that, and it lands in the middle of the country's worst ever foot-and-mouth outbreak. Modumo has said nothing publicly, and no finding has been made. Full story →
Tesla put cars with no steering wheel, no pedals and no mirrors on Austin’s streets, and the safety regulator opened an investigation hours later. American carmakers certify their own cars as safe, and Tesla did that with the Cybercab. Now the regulator wants to know how Tesla reached that decision, including which safety rules it decided don’t apply to a car without a human driver. Tesla shares fell almost 6% the day the investigation became public. Full story →
How does a company like Bell Equipment benefit from the AI boom? It makes the giant dump trucks used on construction sites, and America’s data centre boom needs plenty of earth moved. Bell says that helped its US market recover, even as overall profit fell 66%. US tariffs are another problem, with Bell absorbing some of the cost itself. Its South African factories swung to an R81.4 million operating loss, although it still declared a 30c interim dividend. Full story →
WEATHER
BAGEL GAMES
Have you got what it takes to win today’s Wordle? Play here →
THE ANSWER
As for the Bagel Bite, the answer is: A. Peregrine falcon
The peregrine falcon is the fastest animal on Earth, reaching over 380 kilometres per hour as it dives to catch prey. In a hunting dive called a stoop, the falcon tucks in its wings and drops at astonishing speed, faster than any other creature. Its body is built for it, with special structures in its nostrils that let it keep breathing as air rushes past. Peregrines live on almost every continent and have adapted well to cities, where they nest on tall buildings and bridges. They hunt other birds in mid-air, striking with a powerful blow.
That’s your Tuesday sorted. Enjoyed it? Forward it on, a friend can subscribe in a click. Written by the Business Bagel crew.