Afrihost recently launched capped fibre products for subscribers, augmenting its existing uncapped fibre range.
The capped packages are available on multiple fibre networks, and were announced soon after the ISP revealed it was doing away with small-cap ADSL accounts.
Afrihost said cheaper DSL options – when all cost factors were taken into account – were costing the company money.
Despite the axing of the lower-end capped products, Afrihost believes that capped accounts will always play a role in the market.
“We see data caps increasing as upstream costs decrease and economies of scale make it possible for us to offer clients more broadband for a minimum fee that allows us to cover administrative costs,” said Afrihost.
A driving force behind the need for larger caps is increased line speeds, which Afrihost sees ramping up as fibre continues to roll out.
“We expect to see DSL lines continue to dominate fixed-line broadband for the immediate future, but we do expect fibre roll-out to accelerate as more providers join the market.”
“While we see many users going for lower speeds on fibre – 20Mbps and 50Mbps – we predict they will upgrade in the future, especially as more users embrace media streaming and cloud-based services.”
“As users upgrade their speeds, we’ll also see data caps increasing,” said Afrihost.
The problem with ADSL
Afrihost said it faced several challenges in its mission to deliver high-speed, affordable bandwidth across DSL and fibre networks.
“In terms of DSL, the biggest challenge is still the limitations posed by Openserve’s infrastructure, in terms of cost, maintenance, and demand,” said Afrihost.
“Naked DSL and local loop unbundling could help stimulate the market and improve services.”
For fibre, the main challenge was the “rate of roll-out”. This is “dependant on lengthy council approval processes”, it said.
“A government intervention to fast-track this process could help to speed up installations and get more people onto fibre, which could relieve some pressure on Openserve’s DSL infrastructure,” said Afrihost.
Despite this, Afrihost is “very happy” with the uptake of its fibre packages so far.
“We were initially cautious in entering the market, and this approach helped us to streamline our processes to facilitate smooth-running orders and installations.”
“We’re now seeing a massive increase in sign-ups, as more clients get access to fibre in their areas and in response to our competitive offerings.”