Telkom CEO Sipho Maseko recently said household ADSL bills will soon not have a “line rental” item on them, and it will “just be a package of 25GB or 50GB, which will be priced as a service”.
Maseko’s comment gave hope that Telkom will remove the compulsory R189 analogue line rental from its ADSL service.
However, the more likely scenario is that it will be bundled with ADSL access and data, according to local ISPs.
Telkom’s fibre-to-the-home already sets the standard for the way forward, where subscribers purchase the full service for a set price.
This is in contrast to ADSL, where subscribers pay for three different components: analogue line rental (R189 per month), ADSL access, and data.
To create broadband services which do not differentiate between access mediums, Telkom will need to bring ADSL in line with its FTTH and LTE billing structures.
This means line rental will need to disappear.
Telkom was asked for clarity about Maseko’s comments, but the company declined to answer questions.
One of the reasons for Telkom’s lack of clarity may be that the company has not informed its Internet service provider partners about its plans yet.
MyBroadband asked ADSL service providers what they think of Telkom’s new line rental removal plan, and what they expect from the company.
Cybersmart CEO Laurie Fialkov – Telkom’s hand is forced, because ADSL has become more expensive than FTTH.
Cybersmart CEO Laurie Fialkov said Telkom’s hand is forced, because several FTTH products come with a telephony service and are now cheaper than ADSL.
“Removal of the line rental fee will make ADSL a competitive offering again,” said Fialkov.
Fialkov said he hopes Telkom’s new system will allow ISPs to provide customers with a single bill, without the need for Telkom to bill the client for line rental.
“The interesting question is whether a customer with a telephone line will be able to cancel the telephone service without disrupting their ADSL service. I am betting this won’t be possible,” said Fialkov.
Webafrica’s connectivity head Greg Wright – We hope there is a legitimate cost saving for ADSL users.
Webafrica’s connectivity head Greg Wright said they are holding thumbs that there is a legitimate cost saving for ADSL users. “If there is, it should open up the market,” he said.
Wright expects Telkom to align ADSL and fibre in terms of pricing and packaging, where, regardless of the access medium, you will pay the same price for access to voice and data.
“Hence, ISPs would charge their customers a rate for the line which includes access to data and voice, with no bill from Telkom for the line rental portion,” said Wright.
MWEB CEO Derek Hershaw – Telkom is likely to stop showing the line rental as an individual item on the bill, but the charges are not going to fall away.
MWEB CEO Derek Hershaw said Maseko most likely referred to removing line rental as an individual item on the bill, but the charges are not going to fall away.
“I don’t think there’s any point in speculating what their intentions are – let’s wait until they come out with something specific,” said Hershaw.
Vox Telecom senior product manager Justin Hovener – We definitely support the removal of the line rental charge on ADSL.
Justin Hovener, senior product manager at Vox Telecom, said they definitely support the removal of the line rental charge on ADSL.
“We would have liked to have seen more detail in this announcement as it has been anticipated for some time. Having said that, all initiatives that benefit the end consumer are always welcome,” said Hovener.