Mobile broadband prices dropped massively: Telkom Mobile

The Internet Service Providers’ Association of SA (ISPA) recently called for greater competition in the mobile data market to drive down “high mobile broadband costs” and increase broadband access in South Africa. Telkom Mobile said it has already happened.

In a press statement ISPA said that South Africans pay too much for mobile data connectivity, asking government to address this issue by using its policy, legislative, and regulatory powers to increase competition and bring the prices down.

Telkom Mobile hit back, saying that aggressive competition in the broadband space has seen operators competing to provide the best priced broadband offers to the market.

“Broadband pricing has been dropping significantly in the last couple of years and Telkom Mobile currently offers the most competitively priced Data plans in the market with pricing as low as 1c per MB,” said Caroline Macharia, Telkom Mobile’s Portfolio Manager: Commercial Product Development Data, VAS & WASP Services.

Macharia added that increased competition and reduced pricing alone will not significantly increase the uptake of broadband.

“Radio Frequency Spectrum policy for broadband remains a barrier to broadband market development and is key to resolving the challenges currently being faced by the industry,” said Macharia.

Macharia said that a shared challenge faced by operators is the lack of access to radio frequency spectrum in the lower frequency bands which is crucial in enabling the roll-out of broadband networks to rural areas and addressing the digital divide.

“Total cost of ownership of a broadband service is also a barrier to the uptake of broadband services,” she added.

“Devices for broadband use such as netbooks, tablets, laptops, PC’s, iPads and smartphones are much more expensive than voice handset devices making them unaffordable for the majority of the population and especially for people living in the rural areas.”

Macharia said that subscribers can currently acquire a handset for R99 while the acquisition costs for broadband devices is significantly higher.

“While there is a culture of people handing down voice people are not as willing to hand down devices like tablets or smartphones due to the high acquisition costs,” she said.

“Some form of government subsidy or tax incentives on devices for broadband use such as netbooks, tablets, phablets, laptops, PC’s, and smartphones will go a long way to addressing this challenge.”

According to Macharia, broadband is also a sophisticated technology which requires some level of technological literacy.

“Some form of formal ICT education program is key to advancing this. Educating the market on the benefits of broadband will play a major role in promoting the uptake of broadband services,” she said.

“Content and applications also play a role in creating relevance for broadband and advancing the uptake of broadband services. This remains an area for improvement by operators.”

Macharia concluded that increasing competition may have an impact on reducing pricing. However, this would not necessarily promote the uptake of broadband services.

“Without [concurrently addressing] the cost of broadband, scarcity of radio frequency spectrum for broadband, availability of relevant content and applications, and educating the market on the benefits of broadband, broadband uptake will not increase significantly,” said Macharia.

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Mobile broadband prices dropped massively: Telkom Mobile