Fibre war in South Africa heats up

South Africa’s biggest fibre network operators are in a heated battle, cutting prices and increasing line speeds to win over customers.

Over the past two years, the prices of fibre-to-the-home (FTTH) packages have come down significantly as demand has surged and rollouts have reached hundreds of thousands more households.

The Covid-19 pandemic saw Internet traffic climb exponentially as people spent more time working and relaxing at home — with entertainment video streaming and conferencing increasing in particular.

Several fibre network operators (FNOs) introduced free line speed double-up promotions to help Internet service providers (ISPs) handle this surge.

But even after life gradually returned to normal, traffic remained high as consumers grew accustomed to their hungrier consumption habits.

Frogfoot was one of the first to implement its upgrades permanently.

However, Openserve blew the field wide open with substantial line speed increases and price cuts to ISPs in February 2021.

These changes made its packages significantly cheaper than most major FNOs.

Its biggest competitor — Vumatel — endured harsh criticism from customers for not also dropping its prices.

So significant were these changes that a recent report from Analytico showed that Openserve had become the most preferred FNO in South Africa.

That is despite it being owned and operated by Telkom, which still contends with its ill fame for monopolising fixed-line Internet in the country.

Consumers have appeared willing to forgive the company for its past sins — with price being the decisive factor.

Although Openserve now holds favour in the middle-class fibre market, Vumatel has been taking significant strides in another market.

The country’s biggest FNO has already pushed into lower-income areas with Vuma Reach, offering more affordable uncapped fibre packages on a prepaid basis.

This product has proved so successful that Vumatel is trialling a new Vuma Key service aimed at households with monthly incomes below R5,000.

Openserve and Frogfoot have also launched more affordable entry-level fibre products in select areas — dubbed Openserve Web Connect and Frogfoot Air.

To better compete with Vumatel, Openserve made its 20Mbps Web Connect product available on prepaid terms, making them easier to buy for households with inconsistent income.

MetroFibre and Vumatel recently doubled line speeds and reduced prices on most of their packages, significantly reducing Openserve’s price advantage.

MyBroadband found that MetroFibre was now neck-and-neck with Openserve regarding the pricing of entry-level packages from several popular ISPs.

However, at 50Mbps and 100Mbps, MetroFibre seems to be the best-priced option.

Vumatel’s promotional speed double-up, which will last until end-January 2023, has also made its higher-end packages — from 200Mbps to 1Gbps — highly competitive.

To illustrate how the prices of the four major FNOs currently compare, we analysed their products from three major ISPs — Afrihost, RSAWeb, and Cool Ideas.

We did not include the FNO’s lower-income-focused packages, as these have very limited coverage.

Now read: Vuma Core, Vuma Reach, and Vuma Key — Vumatel’s three services explained