How cheap Internet prices are in South Africa

The Economist Intelligence Unit has released its Inclusive Internet Index report.

The Facebook-commissioned index assesses the performance of countries in four categories: Accessibility, Affordability, Relevance, and Readiness.

Overall, South Africa placed 39 out of 86 countries – making it the top country in Africa

In the affordability category, the index placed South Africa at 33 for price, and at 24 for the level of competitiveness in the environment.

Price measures the cost of Internet access relative to income, while the competitive environment metric looks at the concentration of the marketplace for Internet service provision.

Price

South Africa mostly ranked in the bottom half of the world when it came to “price relative to income” measures.

The table below summarises how South Africa’s overall rank for Internet pricing was calculated.

South Africa – Price
Metric Rank Measurement Detail
Smartphone 27 94% affordable Scores the price of an entry-level Internet-enabled handset.
Prepaid mobile phone service 52 1% of monthly GNI per capita Price of 500MB prepaid mobile data plan.
Postpaid mobile phone service 51 2% of monthly GNI per capita Price of 500MB postpaid mobile data plan.
Fixed-line monthly broadband 48 4% of monthly GNI per capita Price of a 256kbps (or next nearest) fixed-line monthly broadband.

Competitive environment

The competitive environment measures the concentration of the marketplace for Internet service provision, and looks at average revenue per user and market share.

The table summarises how South Africa’s overall rank for its competitive environment was calculated.

The market share rankings are defined as follows:

  • Unconcentrated: Hirschman-Herfindahl Index of <3,000
  • Moderately concentrated: Hirschman-Herfindahl Index of 3,000-4,000.
  • Highly concentrated: Hirschman-Herfindahl Index of >4,000
Competitive Environment
Metric Rank Measurement Detail
Average revenue per user 40 $101 Average revenue per user for wireless operators (data and voice).
Wireless operators’ market share 24 3,414 South Africa is “moderately concentrated”.
Broadband operators’ market share 1 2,176 South Africa is “unconcentrated”.

Now read: High mobile data prices – Operators respond

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How cheap Internet prices are in South Africa