Fibre war in South Africa — with prices dropping below R400

Fibre-to-the-home (FTTH) in South Africa is cheaper than ever before, with 25Mbps packages starting for as little as R399 per month.

South Africa’s home fibre market saw the beginning of a real price war when the country locked down for the Covid-19 pandemic.

Fibre network operators (FNOs) were among the companies that wouldn’t let a crisis go to waste.

The operators scrambled to outdo each other by offering free speed upgrades or price cuts to give households more capacity as people worked, studied, and consumed entertainment online.

Internet Service Providers (ISPs) passed the upgrades on to their customers, resulting in big surges in traffic on their networks.

Telkom’s wholesale and networks division Openserve set the tone for permanent changes when it revamped its fibre and copper products in February 2021.

The company more than doubled the download speed of its 10Mbps and 20Mbps packages, and doubled 50Mbps and 100Mbps lines — while keeping prices the same.

However, the move was met with some criticism from ISPs, which explained that Telkom had not implemented a corresponding discount in wholesale bandwidth.

Regardless, the new prices eventually forced the hand of other FNOs, including Openserve’s biggest rival — Vumatel.

Openserve bakkies and employees

We compared the current prices of entry-level fibre packages with those from before the Covid-19 pandemic.

We used Vumatel and Openserve’s pricing for our comparison, as these are the two biggest FNOs in the country.

Out of six ISPs on Openserve’s network, five had lower prices on their entry-level packages in April 2022 compared to February 2020.

Telkom Retail offered the lowest price on a 25/5Mbps package — at R399 per month.

That is a reduction of R250 from the R649 it charged on a 10/5Mbps package two years ago, making it about 39% cheaper.

Similarly, Afrihost’s 25/10Mbps package was R170 less than its 10/5Mbps product cost in February 2020.

Axxess, Cool Ideas, and Supersonic were also around R50 cheaper on their 25Mbps packages than their 10Mbps products were two years ago.

While RSAweb’s price remained the same, it offers the cheapest symmetric 25/25Mbps connection in our comparison at R595 per month.

Vumatel employee and his bakkie

The picture differed somewhat when considering Vumatel. On four of the ISPs compared, entry-level package prices had grown more expensive in the past two years.

While Vumatel’s packages might not stack up well against Openserve, it should be noted that they are substantially cheaper on a per-Mbps basis than they were in 2020 while still being in a similar price bracket.

For example, Afrihost’s current 20/10Mbps Vumatel package is R727, R28 more expensive than the 10/10Mbps package from 2020, which cost R699.

That works out to R36.35 per Mbps of download speed on the 20Mbps product, against R69.90 per Mbps on the 10Mbps package.

The table below summarises the prices of entry-level fibre packages from fibre ISPs on South Africa’s two biggest fibre networks — Openserve and Vumatel.

Now read: How Supersonic rapidly grew its subscriber base and became ISP of the year