Telkom ADSL pricing surprise

Telkom is planning to increase the access fee of its entry level ‘Fast DSL’ product by between R8 and R10 per month.

Two independent sources have informed MyBroadband that Telkom is planning to charge Internet Service Providers (ISPs) between R8 and R10 per month extra per ‘ADSL line’ for its entry level broadband service.

ISPs may try to absorb the increased DSL access costs from Telkom, and hence not pass this increased cost on to consumers, but with already thin margins this could be challenging.

Telkom announced on Friday 1 June 2012 that it will increase the speed of its 384kbps ADSL subscribers to 1Mbps, and will boost the speed of its current 1Mbps users to 2Mbps.

Telkom did not mention pricing in its press statement, and it is assumed that the upgrades will be free of charge.

The entry level ADSL price increase may be unrelated to the ADSL speed increase plans, as Telkom is under financial pressure. The incumbent is facing sliding fixed line numbers and voice revenues, and an increase in ADSL pricing will assist the company to boost revenue.

Telkom was asked about its plans to increase the price of its entry level ADSL product, but the company did not respond by the time of publication.

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Telkom ADSL pricing surprise