How much will you really save on ADSL?

[Turtle]

I think this kind of comparison is necessary to highlight the effective saving on ADSL. ADSL is sold as a bundled product, so every time one of the components are reduced Telkom can claim ‘x % reduction on ADSL’. Not good!

I think it's also perhaps worth weighing these reductions against the anyway general downward trend of ADSL prices all over the world ... if it's dropping by, say, 20% everywhere else (on average), and it only dropped by 12-15% here, we're not really making much progress (I don't know the actual figures). It's also worth considering that the 'ADSL line rental' portion is almost pure profit for Telkom anyway, so we're just paying slightly less to breathe basically (i.e. they're not providing any kind of service at all in exchange for that portion of the money).

 

[Turtle]

They took the TOTAL of all the reductions and divided it by the TOTAL of all the access costs to get 24% ... talk about making statistics work for you!

And to top it off, the rolling headline I saw on the news last night was, simply, 'Telkom files for 32% ADSL price reduction with ICASA' ... ! (No doubt issued verbatim by Telkom PR ... and as we know journalistic fact-checking is so last-century.)

 

[DavidKinnes]

I think it's also perhaps worth weighing these reductions against the anyway general downward trend of ADSL prices all over the world ... if it's dropping by, say, 20% everywhere else (on average), and it only dropped by 12-15% here, we're not really making much progress (I don't know the actual figures). It's also worth considering that the 'ADSL line rental' portion is almost pure profit for Telkom anyway, so we're just paying slightly less to breathe basically (i.e. they're not providing any kind of service at all in exchange for that portion of the money).

Thats a good point perhaps some one could write and article showing that by giving a price reduction of ONLY 12-15% we actually in real world terms are getting hiked whatever % ?

 

[Abe]

I will add a survey-like poll to this thread in a few minutes...

The only problem I can see with a poll on who has got what is that a lot of the small home users who use 192 lines would not even know to look here (For example my mom). Although my mom does not use TelkomInternet, I am sure that most of these small guys just subscribe to the 192/TI 3GB bundle and don't look back.

 

[Toxin]

OMW!!1 Ginormous poll!! Just looking at it...... hurts eyes....... must click...... too many options......

Done.

 

[BTTB]

Telkom slashes Internet prices

Telkom slashes Internet prices
Lee and Barry should rephrase the Title on this IOL article, that internet prices will be slashed.
This is the kind of media attention that Telkom was aiming for?
Telkom knows how to play the game of cat and mouse.

Just amuses me that Lee and Barry fell for it.
Perhaps they were trying to catch the readers eye like most journalists, but came out looking like they work for Telkom's Marketing Department.

 

[Abe]

I hear you, but the point of the survey, is not to try and find out how many DSL192|384|512|1024 subscribers [customers] there are across Telkodemonopolies' entire ADSL customer-base, but rather to try and determine, out of forumites that are current ADSL customers, how many are happy with the price reductions that apply to the service they currently pay for, as well as their views on the price reductions of the other services .

Teach me to post before the poll came out

 

[bwana]

I will add a survey-like poll to this thread in a few minutes...

Spent all that time making my choices only to be told I'd already voted?

 

[UncleSam]

surely by increasing analogue line rental theyre going to be making more money overall anyway? I thought one of the biggest arguments against fixed lines were that the majority of South Africa couldnt afford one because of the line-rental. So Telkom just increases it. Its absurd. Dont they care about improving South Africa at all?

 

[bwana]

LOL, you're obviously pulling my leg(s), you have indeed already cast your vote in favour of 9 survey options .

Wasnt pulling your leg(s) but I'm glad my vote was counted. Thanks

 

[Juice]

The average of 24% (ACTUALLY 23.4%, but they’ve taken some liberty with rounding it off…) quoted by Telkom is USELESS without the reductions being weighted by product. What I really want to get to is what the actual 'price reduction' is worth on TELKOM’s side. Since Telkom refuse to give us the figures broken down by line speed, we’ll just make them up, but it will serve the purpose of illustration.

ASSUMPTIONS (no statistical analysis will be complete without it)

Let’s assume that the product distribution is as follows:
192 – 50%
384 – 25%
512 – 15%
1024 – 10%
Let’s assume that last year we had 70,000 subscribers and this year we have 140,000 subscribers.
Let’s further assume that the subscribers have increased linearly over all the above products.
Let’s assume that IS was correct at the ICASA hearings and that it costs Telkom only R40 to supply ADSL infrastructure, irrespective of product. (Considering that you have to have a telephone line over copper and THAT rental fee has always been enough to cover the cost of the maintenance LONG before ADSL came along.)

ANALYSIS

The profits as they exist at the moment are as follows:
192 – [(270-40) * 140,000 * 50%] = 16,100,000
384 – [(359-40) * 140,000 * 25%] = 11,165,000
512 – [(477-40) * 140,000 * 15%] = 9,177,000
1024 – [(680-40) * 140,000 * 10%] = 8,960,000
For a total of R45,402,000.

Now, with the new ‘price reductions’, the profits will look like this the next month:
384 – [(245-40) * 140,000 * 75%] = 21,525,000
512 – [(362-40) * 140,000 * 15%] = 6,763,000
1024 – [(516-40) * 140,000 * 10%] = 6,664,000
For a total of R34,951,000.

So, it seems that while Telkom will be netting a profit of R35 Million, it will about R11 Million less at the end of August than it will be at the end of July.

BUT: Considering that we had 70,000 users last year in August, the profits as they existed THEN were as follows:
192 – [(270-40) * 70,000 * 50%] = 8,050,000
384 – [(359-40) * 70,000 * 25%] = 5,582,500
512 – [(477-40) * 70,000 * 15%] = 4,588,000
1024 – [(680-40) * 70,000 * 10%] = 4,480,000
For a total of R22,701,000…

What does this mean? Well, for one thing, it means that even after the so-called ‘price reductions’ in August this year, Telkom will still be making R12 Million more this August than they did last August!! Which is a GROWTH in profit of over 50%!!! So why should we, the consumers, be satisfied with even a piddly 24%???

/spit

PS: Assuming that the R40 cost of maintaining an ADSL line is a little too low, I’ve worked out that if it actually costs R215, and NOT R40, Telkom will make EXACTLY the same amount of profit (of R10,451,000) this year than it did last year with the current projected ‘price reductions’.

Someone should show THIS to ICASA...

Juice

 

[.geek]

Bit of an overcomplicated poll..

 

[kilo39]

Telkom slashes Internet prices

South African National Consumer Union vice-chairperson Lillibeth Moolman said she welcomed a price reduction but said it should be simplified for the consumer to understand.
-
"Icasa's intervention ensures that there is more discipline and restraint shown by Telkom and they are doing a good job. But we know that Telkom makes extraordinary profits and compared with the overseas market their costs are still very high."

Lost at sea.

 

[Evil-Concarne]

Nice topic and poll >> all

 

[Mask]

From the IOL article:

For Internet connections, the DSL 192 megabyte package rental comes down from R270 a month to R245 while DSL 384 decreases by 31 percent from R359 to R245.

Oh yes - these two know what they're talking about!

 

[shilliar]

so let me understand this.
4000000 telephones go up with R7 to R10 @ R7 extra (+- R28 000 000 extra for telkom)
dsl 512k line goes down by R115 @ +-150000 customers = +- R17 250 000 less for telkom. difference is R10 750 000 extra for Telkom R10.7 million extra. so who is Telkom fooling..

 

[BTTB]

so let me understand this.
4000000 telephones go up with R7 to R10 (+- R28000000 extra for telkom)
dsl 1024k line goes down. the maximum R164 @ +-150000 customers = +- R24600000 less for telkom. difference is R25540000 extra for Telkom R25 million extra. so who is Telkom fooling..

Certainly not the MyADSL Forum.

Take into account that these announcements refer only to ADSL line and "connectivity" rental of which the former has actually gone up in price, but not bandwidth costs which is still extra onto that.

Telkom tries to pass the buck here, claiming that ISP's charge for bandwidth, which is true, but who charges them?
Ever since per GB Billing was introduced the cost of bandwidth has been formalised at about R75 per GB, with the net result that a 10 or 30Gb Account is going to cost the consumer a packet.

 

[telkomsuig]

so let me understand this.
4000000 telephones go up with R7 to R10 @ R7 extra (+- R28 000 000 extra for telkom)
dsl 512k line goes down by R115 @ +-150000 customers = +- R17 250 000 less for telkom. difference is R10 750 000 extra for Telkom R10.7 million extra. so who is Telkom fooling..

To be fair you need to take into account inflationary operating cost increases and decrease in residential lines they experience every year..

Don't get me wrong though i don't agree with the new pricing model

 

[LifelongGamer]

Fuel to the fire?

I've read all previous posts and I've not seen mention at the bigger picture.

We're all doing what Telkom expects us to do - look at this on a micro-level, because we've become good at picking out the finer points which is conveniently left out of the media limelight.

Has anyone thought about this from the perspective of multiple users in a single household? The ADSL router / modem usually has built-in 4 port ethernet hubs - so dad can have his pc connected in his home-office (if he has one), the kids can share a pc in the study, maybe there's a LAN setup in the garage for all intense purposes. I would hazard a guess that a measly 3GB account being shared over multiple pc's would not last long regardless of line-speed. The cost for additional bandwidth to cater for everyone in the household would be much higher and the single line-rental reduction proposed won't offset the total connectivity cost at all. Now imagine how much lower this reduction looks for those users that for whatever reason cannot use the normal (much lower cost) shaped packages offered by ISP and instead pay extra for an Unshaped service?

It would be interesting to hear from forumites in the above (either one OR both) situations. It's been a long day in the office, but was mention of Shaping / Port-Priotisation / Caps raised at the last ICASA ADSL Hearings? If so, perhaps these price reductions are low specifically because they're the first of many due down the road - however long that may be.

 

[BandwidthAddict]

Hello.

If I were a betting man, I would bet that come August, Telkom will start enforcing the hard cap. They don't have to state anything as the hard cap is offical Telkom policy even though, unofficially, people can get between 6 and 15 GB. By enforcing the hard cap, people will have to buy more accounts and thus the price of "internet" will effectively double for most broadband users (IE not the slight browsing and check email crowd).

As LifelongGamer points out, a family sharing an ADSL connection will hammer their 3GB pretty fast and soon that one account will become two, maybe even three. Back to the good old days of counting the "minutes" (bytes).

Ahh Telkom, the more things change with you, the more they stay the same.

Aaaaaffffriiiiccaaaa!!

Peace.