Competition in the ADSL service provider market is already very competitive which means that Internet Service Providers (ISPs) have to operate on very slim margins. Traditional dial-up, ISDN and ADSL ISPs now also have to deal with new market entrants who are willing to cut their prices to the bone to gain market share.
In the last few months traditional hosting providers have entered the ADSL market with very aggressive tariffs. Afrihost launched a R29 per GB ADSL offering for a promotional period, undercutting all other ADSL service providers. While some industry players described this service as below-cost and unsustainable, Afrihost is still offering this price to customers in a ‘prolonged’ promotional period.
The latest hosting provider to enter the ADSL market with an aggressively priced service is Gridhost with its R44 per GB ADSL data bundles. Gridhost has become known for its cheap R8.95 hosting service, and has now jumped into the broadband market with the same philosophy of cut-throat pricing.
“We’re proud to have entered the ADSL market and are sure that the service will be as much of a success as our Web Hosting has been for our customers” says Dave Lane, Gridhost Core Network Architect.
While not as aggressive as Afrihosts’ fees, Gridhost’s offering undercuts most other similar ADSL data bundles in the market. Gridhost is using standard shaped SAIX bandwidth for its ADSL services, and has four different data bundle offerings: 1 GB (R44), 3 GB (R131.95), 5 GB (R219.95) and 8 GB (R351.95). Gridhost also offers prepaid ADSL data bundles at around R56 per GB.
This offer from Gridhost joins a slew of ISPs which recently either launched new services or dropped the price of their current ADSL offerings to around R50 per GB. This includes Vox Telepreneur, G-Connect and Web Africa.