3 GB is just not enough
South African broadband consumers have become accustomed to low monthly usage limits (aka caps), typically ranging between 1 GB and 3 GB per month. These low usage allowances are inadequate for bandwidth intensive applications which means consumers are forced to keep a close watch on their monthly usage.
The view that 3 GB is not enough was reiterated in a recent MyBroadband poll where nearly 90 percent of broadband users indicated that they need more than 3 GB of bandwidth per month. 26 percent of the voters indicated that they require in excess of 100 GB per month.
When ADSL was launched in late 2002, the service had a 3 GB blended bandwidth cap with unlimited local bandwidth available after the cap was reached. Six years on and the situation has deteriorated.
Telkom’s ADSL caps currently range between 1 GB and 3 GB per month while companies like iBurst sell services with usage limits as low as 40 MB.
Most consumers complain that they ‘hit their cap’ sooner each month, something which is hardly surprising when considering how the Internet has evolved over the last few years. Most international websites are now designed to serve broadband users with uncapped broadband connections of multiple-Mbps and they contain bandwidth intensive features like embedded video files and higher resolution images.
Broadband subscribers are consuming far more bandwidth than what they did back in 2002 without necessarily changing their online habits; the Internet has just become more bandwidth intensive. But if South Africans have kept up with online trends there are now a multitude of new, bandwidth hungry services like Youtube and Last.fm which have become commonplace amoung Internet users.
Dark Fibre Africa (DFA) director Richard Came recently discussed the need for more fibre in South Africa, saying that users will typically need a 5 Mbps connection for proper web usage and up to 19.2 Mbps for HDTV streaming. These speeds are however wasted in a low cap environment.
All of this means that South Africans are now on the wrong end of the digital divide, unable to use bandwidth intensive services because their monthly usage limit is too low. While mobile broadband speeds of 7.2 Mbps are available throughout South Africa, the cost for bandwidth on these services is too high to effectively make use of these speeds.
Neotel Chief Technology Officer, Angus Hay, commented on the pent up demand for higher usage limits, saying that they were surprised by the amount of bandwidth used by their uncapped NeoConnect subscribers. The company expected subscribers to use slightly more than the standard package offering 10 GB and 15 GB of usage per month, but what they found was that some subscribers exceeded 100 GB per month.
Hay said that this is a clear indication that there is a massive demand for bandwidth amoung many local broadband consumers, and it is something which the company is looking to address.
MWEB recently informed subscribers that they will end their ‘uncapped local bandwidth’ trial, partly due to very high usage from certain subscribers. Some individuals were reported to have exceeded 1 TB per month using multiple 4 Mbps ADSL lines, yet another indication of the pent-up demand for uncapped local bandwidth.
Neotel has already changed the broadband landscape slightly with their standard 10 GB, 15 GB and uncapped broadband solutions, but this was not enough to make companies like Telkom respond. Telkom’s ADSL prices have remained unchanged since August 2007 despite the fact that they are losing market share to Vodacom, MTN, iBurst and now Neotel.
Things could change when SEACOM becomes operational later this year. More affordable international bandwidth should have a direct effect on the usage limits provided to customers, and since broadband providers are not always keen to drop prices they may look at higher speeds and caps to add value.
While SEACOM is expected to start operating in June this year, telecoms experts have warned that it will take some time for the benefit of lower priced international bandwidth to flow down to consumers. What is clear is that broadband consumers should get some relief from the prohibitive caps they have growth accustomed to.
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