Communications Regulatory Commission finally set the new internet prices in Iran. They lowered mobile and landline-based internet prices but it might actually cause the mobile internet prices to go up.

Setting the internet prices in Iran is a big news nowadays. The services are not that good yet but the government tries to lower the prices constantly. But the story gets complicated as they go further. As covered the mobile internet prices in this post, we mentioned that in some parts of the city you can even use mobile internet as your primary source of data even when you have access to the landline-based internet such as ADSL since the prices could be cheaper. As you can guess many people started using their mobile data as their primary source of internet and ISPs started to feel that they are losing the game to the mobile operators. That’s when the government came in to resolve the issue. At first, there were some talks that the government wants to set the lowest price for the internet packages provided by the mobile operator to help the ISPs to keep up with them. This news brought many negative feedbacks from domestic medias in Iran. So what was the solution?

If you study the market you’ll find out that the people who are switching their data usage to the operators’ are using the operator’s internet packages. So the government brought in a new solution without touching the data packages. The solution was to lower the base (per KiloByte) internet prices to lower the operator’s income from it. In this case, the operator’s income from free internet usage (when the user is not using the packages) would go down and they have to somehow make up for it. So the only solution for the operators would be set higher prices for their packages to make up for the lost that they would have from the free internet usage. Of course setting the prices were not only for the mobile internet, the Communications Regulatory Commission also lowered the landline-based internet prices such as ADSL by 20% which is not that great in terms of internet quality but still a good initiative.

Communications Regulatory Commission lowered the prices of mobile internet (free usage) from 0.5 Rial to 0.4 Rial (Dollar is nearly 35,000 Rial). In this scenario, the government has lowered the standard price of the internet for the operators but on the other hand, they forced the operators to increase the price of their internet packages. We should pay attention to the fact that there are 40M smartphones in the country right now and demand for the mobile internet is rising every day and it’s becoming one of the primary sources of revenue for the operators.

Let’s not forget that the government has a responsibility to support ISPs because there are many people working in these companies and if the companies couldn’t keep up with the operators they would be crushed, and the people would lose their jobs. Maybe this is not the best solution for the end users but it’s a temporary solution for this problem. And if the government feels the responsibility to support these companies they should come up with a permanent solution to have these companies back, and even better bring in a solution to lower its role in the market and let the market decides where it should head to.

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