Sign up with Google<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica" id="quote">quote:<hr height="1" noshade id="quote"><i>Originally posted by nonroker</i>
<br />There's no ways their network will be able to handle the load if every guy and his dog has a 512K connection, not to mention their Internet connection
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Why not? I disagree. It works in almost every other country on the planet, and in fact this is exactly what <i>makes</i> it work, i.e. allowing "every guy and his dog" to have a broadband connection. Korea is a (the) prime example. The average broadband connection is about 8 Mbits/second, never mind 512k. And they have broadband penetration of over 78% of households (over 12 million broadband lines in a country whose population is only about 10% more than SA). The key is to make the price (of e.g. a 3GB capped version) low enough to attract the hundreds of thousands of users who are mainly only interested in e-mail and some web browsing. These kinds of users don't put much strain on the network. If you have, say, 100,000 such low bw users and say 5,000 high bw users, your income should be able to cover the overall costs. Currently the ratio of high to low bw users is much higher. As strange as it may sound to us (i.e. we like to download lots of stuff), the majority of people <i>won't</i> just start using up tonnes more bw just because they now have an always-on connection, because most people quite frankly have other interests/priorities and just couldn't care about sitting and downloading stuff all day. People like my mom/sister/gran etc. The potential market size in SA is probably easily over 1,000,000 connections in the major cities alone.
Telkom are effectively making the same mistake with their "HomeADSL" 2GB cap product. Nearly R700/month but obviously aimed at low bw users, that's a huge rip-off, such a product <i>shouldn't</i> cost more than about R300/month in a competitive market, and the market they're seemingly aiming at with this product already has a "pscyhological" cut-off point of around R300/month. In a monopoly market you have to set your pricing at "what the market will bear", not "however high you like". "The market" in this case will not bear nearly R700/month. They won't gain much market share like this. But then they aren't interested in expanding market share because that requires spending R&D money that could otherwise be turned into profit and bonuses. Expanding the market size means investing in infrastructure, which they could easily do if they just took say R3bil of their R4.5 billion profit from last year and spent it on R&D, but they're too greedy and shortsighted to do that. (With that kind of money you could build at least <b>15</b> Sentech-size networks, or install a whole extra under-sea fiber to Europe.)
<br />There's no ways their network will be able to handle the load if every guy and his dog has a 512K connection, not to mention their Internet connection
<hr height="1" noshade id="quote"></blockquote id="quote"></font id="quote">
Why not? I disagree. It works in almost every other country on the planet, and in fact this is exactly what <i>makes</i> it work, i.e. allowing "every guy and his dog" to have a broadband connection. Korea is a (the) prime example. The average broadband connection is about 8 Mbits/second, never mind 512k. And they have broadband penetration of over 78% of households (over 12 million broadband lines in a country whose population is only about 10% more than SA). The key is to make the price (of e.g. a 3GB capped version) low enough to attract the hundreds of thousands of users who are mainly only interested in e-mail and some web browsing. These kinds of users don't put much strain on the network. If you have, say, 100,000 such low bw users and say 5,000 high bw users, your income should be able to cover the overall costs. Currently the ratio of high to low bw users is much higher. As strange as it may sound to us (i.e. we like to download lots of stuff), the majority of people <i>won't</i> just start using up tonnes more bw just because they now have an always-on connection, because most people quite frankly have other interests/priorities and just couldn't care about sitting and downloading stuff all day. People like my mom/sister/gran etc. The potential market size in SA is probably easily over 1,000,000 connections in the major cities alone.
Telkom are effectively making the same mistake with their "HomeADSL" 2GB cap product. Nearly R700/month but obviously aimed at low bw users, that's a huge rip-off, such a product <i>shouldn't</i> cost more than about R300/month in a competitive market, and the market they're seemingly aiming at with this product already has a "pscyhological" cut-off point of around R300/month. In a monopoly market you have to set your pricing at "what the market will bear", not "however high you like". "The market" in this case will not bear nearly R700/month. They won't gain much market share like this. But then they aren't interested in expanding market share because that requires spending R&D money that could otherwise be turned into profit and bonuses. Expanding the market size means investing in infrastructure, which they could easily do if they just took say R3bil of their R4.5 billion profit from last year and spent it on R&D, but they're too greedy and shortsighted to do that. (With that kind of money you could build at least <b>15</b> Sentech-size networks, or install a whole extra under-sea fiber to Europe.)
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