The cheapest 1 GB broadband service
The South African telecommunications market has started to see the benefits of liberalization in the form of cheaper international bandwidth – brought about by SEACOM’s arrival – and more affordable ADSL bandwidth.
The price of low end broadband services has however not showed much movement. Some industry players have said that the price floor for a broadband service most likely sits at between R 200 to R 220 per month, and Telkom recently said that their R 199 Do Broadband ADSL service is very close to cost.
We investigated the total cost of ownership of the main entry level broadband offerings. A 1 GB package was selected as this is widely used as a low cost Internet connection in South Africa.
The ADSL Internet Service Provider (ISP) market is very competitive in South Africa which means that consumers can get ADSL packages for as low as R 135.00 per month which includes both ADSL access and 1 GB data charges. For this pricing comparison Telkom’s Do Broadband Level 1 service was used without the self-install option and incorporating the most affordable Telkom ADSL Modem.
While Telkom’s DSL384 service emerged as the most costly offering, it should be noted that the service has a few benefits over competitors, including more affordable ‘out-of-bundle’ bandwidth and 10 GB free local bandwidth. It is however far slower than competing wireless offerings.
The following table provides a pricing comparison for the total cost of ownership of a 1 GB broadband service over a 24 month period. In most cases the 24 month contract prices were used which includes a modem.
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1 GB Broadband Service: Total Cost of Ownership
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| Service | Installation/Activation | Equipment | Montly Cost | 24 Month Total |
| iBurst Wireless | R 99.00 | — | R 219.00 | R 5355.00 |
| Telkom Do 3G | R 199.00 | R 581.25 | R 219.00 | R 6036.25 |
| Neotel NeoConnect Prime | — | — | R 279.00 | R 6696.00 |
| Vodacom HSDPA | R 99.00 | — | R 349.00 | R 8475.00 |
| MTN HSDPA | R 99.00 | — | R 349.00 | R 8475.00 |
| Telkom DSL384 Do1 | R 1066.36 | — | R 330.00 | R 8986.26 |
1 GB broadband price – discussion
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