Lower local internet costs expected soon!
Cyberspace lovers could soon be getting more bang for their buck when it comes to internet connection fees in the country.
Better infrastructure and increased competition in the internet connection industry will allow consumers to pay approximately 50% less on their connection fees, according to Frost and Sullivan ICT analyst Vitalis Ozianyi. Connection fees have been incredibly expensive, so much so that it is cheaper to transport a gigabyte of information from Britain to SA than between Johannesburg and Cape Town.
South Africans who have previously felt that they were being ripped off by internet service providers, as revealed in a 2007 report done by Business Leadership SA, can now breathe a sigh of relief.
According to ECR Newswatch, Communications Minister Roy Padayachie announced at the unveiling of a cyber-lab at a rural Kwa-Zulu Natal High School in Ndwendwe last Thursday South Africans can expect the cost of broadband to steadily decline as the country has benefited from major undersea cables that have recently come online. The prices we pay for internet access are largely determined by the cost of international bandwidth, as most content and services sit offshore.
Padayachie says his department met with service providers at a recent summit where providers made a commitment to bring down costs so that more South Africans can have access to broadband says ECR Newswatch.
Questions may be raised as to why it’s taken so long for consumers’ wallets to feel some much needed relief, Ozianyi says this is due to the “lack of sufficient infrastructure”. He adds that there’s been a considerable increase in the number of cables being laid across the country and points of position – the areas in which companies like Broadband Infraco and Neotel have bandwidth capacity to provide internet connectivity.
Director of BMI-TechKnowledge Brian Neilson adds that competition in the broadband market intensified dramatically in 2010, following more moderate levels of competition previously. Neilson says that cellphone giants have seen the gap in the market. “Cellphone networks have to continually pour money into their networks to keep up with the rapidly expanding broadband usage, which is accelerated by the heightened competition, with MTN and Vodacom owning the bulk of the 3G market, but Cell C taking on an aggressive approach,” said Neilson.
Neilson adds that the biggest change in 2010 is the nature of the cellphone networks’ offerings, providing more service for the same price. “What users pay for five gigs of data today is probably the same as what they paid for one gig not so long ago, thus the unit price of data has decreased while users may be spending the same, or perhaps slightly less” said Neilson.
This is also evident in the recent release of Vodacom results, where the cellphone operator announced that it would be investing R7bn in its network to improve internet and call connectivity. Vodacom CEO, Pieter Uys said at the results announcement that consumers could expect a 12-15% decrease in data tariff charges within the next six months.
Whist it’s currently still cheaper to transport data internationally compared to locally, with the myriad of options that consumers will be given- it will be interesting to see how low the prices go.
Lower local internet costs expected soon! << Comments and views
Source: Moneyweb.co.za
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