About to get cheaper
In recent years, voice telephony costs, particularly for international calls, have fallen sharply as new competitors entered the market to take on fixed-line operator Telkom. But the costs are likely to drop further if all goes according to plan for a new market entrant.
PrimeTel is a new SA company, backed by US venture capitalists. It is promising cut-price local and international calls that will undercut not only Telkom but many of the Internet service providers that offer discounted voice telephony.
PrimeTel head Michael Alter says telecom prices in SA are still exorbitant. “We aren’t that cheap by international standards,” he says. “We will be giving simply what we consider to be a fair price in other countries.” Alter, a Briton who has helped established telecom businesses in the highly competitive Chilean market, says the SA market is “underserved and certainly overpriced”.
PrimeTel is entering an increasingly competitive market, with players such as Vox Telecom and Dimension Data’s Internet Solutions already offering discounted calls by carrying voice traffic using the same communications protocol that underpins the Internet.
Telkom charges 95c/minute during peak hours for calls to both the US and UK and 85c/minute for calls made during off-peak times (at night and over weekends). In comparison, PrimeTel charges 22,8c/minute to the UK (at any time of the day or night) while a call to the US costs 27,4c/minute (also anytime). PrimeTel does not charge on-network calls — that is, calls made to other PrimeTel subscribers. Calls to cellular numbers will cost R1,48/minute and national long-distance calls 47,9c/minute (Telkom charges 65c/minute).
PrimeTel customers will have to lease a broadband digital subscriber line.
The company will pay customers 11c/minute for incoming calls on the PrimeTel line, a model first pioneered in SA by Vox Telecom. Alter says this is a particularly attractive option for call centres.
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