Kenya, Uganda and Rwanda have agreed to reduce the cost of sending a text message across the three countries, according to a report. During a regional summit in Kigali, Rwanda, on 6 March, the three partner states agreed that the wholesale price for SMS within the region will not be more than US $0.03 per SMS, including all applicable taxes, and that the retail price will not exceed US $0.06 per SMS. This is less than half the current market rates.

Tarifica’s Take

While savings of US $0.03 or thereabouts may not seem very significant, such small sums can be make-or-break for consumers in developing, largely rural areas. East Africa is a “mobile-first” market, in which the entire economy is deeply dependent on mobile telecommunications, despite the fact that many users still have not been able to adopt mobile data usage. In such an environment, SMS and voice bear the preponderance of responsibility for transmitting vital business-related information, so a 50 percent reduction in SMS roaming rates should do a great deal to stimulate regional growth—not only in the telecom sector but beyond—and promote trade across the borders. Last year the three nations agreed on a reduction in roaming voice rates, under their One Network Area agreement. The current agreement on SMS extends that thinking into an area that is perhaps even more economically vital.