Afrihost fixed LTE pricing question

[AfriMan]

Ok so setting aside the email...

If sim only is R199, and
sim + device is R249 + R999

There's still the weird difference in price. I still can't figure out what the extra R50 (R249 vs R199) is for when I'm already paying for the device @ R999. Basically I can't buy a sim for R199 and a device for R999. If I want the device too I have to pay R249 + R999.

I can only explain it as seeing them as separate offers. I guess without the device we carry less risk (defects, returns, cancellation costs, etc), so that is probably a factor in how the price was calculated.

If you think about it - you can potentially realise R2,500 in free value in your first month. We supply a router worth R2499 plus one month free (potentially R799) with free delivery etc. That's a total value of R3500 more or less (delivery is about R249). So if you cancel after a month, pay us R999 for the router and R999 cancellation, it doesn't come close to covering our costs.

However, please don't take this as the difference being a payback. Even if someone paid the same rate for 6 months, cancelled and ordered a new SIM only package for the cheaper price (which I don't think we'd have any issue with), it would not cover the cost of the router. It's purely that we've decided to price the packages differently in the market.

 

[AfriMan]

the R50 is for the router which is R999 cash but R1250 over 24 months, you cant fight afrihost over this because if you dont want to pay for the extra R50 per month you can take the sim card only option which has no R50 and buy your router from the cash R999

If you took the SIM only deal and used the savings to "pay" for the router, it would take you 30 months to recoup the opportunity cost that you could have realised by utilising your cash elsewhere. So ultimately, it's always going to be a better deal to take the SIM+ device and not fork out R2499 immediately. R1500 buys a lot of things (especially with Christmas coming). Of course, if you have a Cat ^ or above router, you have other options.

It's a personal choice, but I think it's still an excellent deal.

 

[AfriMan]

I had the same discussion with them yesterday - it doesn't make sense at all. On the one hand, they tell you the router is discounted, but then, on the other hand, they want you to pay an extra R50 per month, which means the router is not discounted as advertised.

This is a really weirdly structured deal that they cannot explain themselves. Add to that the fact that the router image shows its from Telkom (actually Huawei), and that its limited to 30Mbps.

I spoke to a salesperson yesterday who was adamant that the router only supports 30 Mbps, and when I pointed out the technical specification says otherwise, I was told: "go and Google it". Which I did while I was on the line, and then she Googled it herself, at which point her only response was "Sorry for the inconvenience".

Afrihost sales and support seems to be going down the toilet rapidly. I ended up backing out of the deal entirely due to the weird structuring and lack of solid answers.

The R50 difference is not a payback - I want to be super clear on that. Otherwise we would not be able to say that you are saving R1500 and we would also have to give you a payback period. Ultimately, we are not a financial services provider, and that would amount to a "loan" or financing on the device purchase. So, it's definitely not a payback in any way.

 

[AfriMan]

View attachment 741403

1) It's a Huawei product - not Telkom
2) Total cost: R2499. Once-off: R999. Claimed saving: R1500. Extra charges R1200 (R50 * 24)
3) Who wants an LTE-A router that is limited to 30 Mbps?

Valid points on 1) and 3). Please see my posts above on the second point. It's not a payback - the products are priced differently in the market.

Point 3) The router is 300Mbps as far as I can see. I'll ask our web design team to fix that ASAP.

 

[AfriMan]

Yeah, and I'm asking you why they're priced differently. The router is presumably accounted for with the R999, so why the extra R50 for the sim + device option?

Please see my post here

 

[AfriMan]

I agree with this. Smoke and mirrors. I'm guessing there's one of their classic R999 6-month claw back clauses as well meaning they'll get at least an extra R300 over and above the R999 for the router.

It makes sense to cancel the package and migrate back to a sim-only deal as soon as you can, but for some it may not be worth the time and effort... Profit for Afrihost.

If you see my post here you'll see that we don't really make anything extra. In fact, if a client changes to the SIM only deal after 6 months, we'll still write off quite a bit, but the risk is minimised overall, so we're happy to take that loss.

 

[Totempole]

If you see my post here you'll see that we don't really make anything extra. In fact, if a client changes to the SIM only deal after 6 months, we'll still write off quite a bit, but the risk is minimised overall, so we're happy to take that loss.

Fair enough, it is a pretty expensive router by itself, but what interests me more is why this premium differs on Telkom vs MTN fixed LTE? With MTN it's only R50 difference but with Telkom it's R70. Why is that?

 

[AfriMan]

Fair enough, it is a pretty expensive router by itself, but what interests me more is why this premium differs on Telkom vs MTN fixed LTE? With MTN it's only R50 difference but with Telkom it's R70. Why is that?

As far as I know it's a similar price adjustment based on our upstream cost with Telkom.

 

[lokinc]

I have a question about the Telkom Fixed LTE. An ISP is claiming that they sell Telkom Premium Fixed LTE to justify their higher prices. Is there such a product?

 

[AfriMan]

I have a question about the Telkom Fixed LTE. An ISP is claiming that they sell Telkom Premium Fixed LTE to justify their higher prices. Is there such a product?

Not that I am aware of. Telkom doPremium is an old ADSL bundle - not aware of any other products marketed as premium. I know Telkom do sell capped or uncapped - they might be referring to unshaped Capped data, which should be the same across all resellers.