Webafrica introduces R999 cancellation fee — but promises cheapest fibre prices

Webafrica says a new one-size-fits-all R999 cancellation fee for its fibre-to-the-home (FTTH) packages is justified in light of recent price adjustments across South Africa’s major fibre networks.

A WebAfrica customer recently contacted MyBroadband after he noticed the fee when trying to downgrade his line speed from 200Mbps to 100Mbps.

He had been automatically upgraded to the higher speed by his fibre network operator (FNO) — Octotel — after it made package changes.

“The problem now is that none of my devices can receive more than 100Mbps due to the network ports being rated for 100Mbps, which is still pretty standard, not just in my household,” the customer explained.

“I wanted to downgrade back to 100/100Mbps because there is no point having a 200Mbps line if nothing can utilise it.”

Webafrica allowed him to downgrade back to his old speed and pay less per month without immediately paying any penalty fee.

That approach differs from some other ISPs, which immediately pass on specific FNOs’ downgrade penalties.

However, before the customer could proceed with the downgrade, he had to tick off a box which said if he chose to downgrade or upgrade, he accepted he would have to pay a R999 cancellation fee in the future, should he terminate his package with Webafrica.

Webafrica told MyBroadband that its cancellation fee was necessary to compensate for recent price reductions on its packages.

“In light of the increasing financial difficulties that consumers face, Webafrica decided to launch a brand-new product portfolio with market-leading price points across all FNOs,” the company said.

“With the introduction of our aggressively priced portfolio, which is clearly cutting deep into our margins, we’ve introduced a cancellation processing fee.”

It explained the fee replaced the following costs:

• Administrative costs of processing a cancellation with the FNO, which typically required human intervention and a notice period set by the FNO
• All installation and connection fee clawbacks previously applied if a customer cancelled within a short period of taking up the package.
• Costs related to reverse logistics for free-to-use router collection when a customer cancels. Customers don’t have to pay the courier collection fee.
• FNO-determined upgrade or downgrade fees, which range from R100 to R750, excluding VAT.

Webafrica told MyBraodband that the fee is only charged when the customer cancels, not when they move or switch to another FNO and keep Webafrica as their ISP.

The amount of R999 was informed by the fact that Webafrica had a cancellation rate of less than 1%.

“It is in the majority of our customer base’s interest that we proportion these cancellation costs to the minority that choose to cancel instead of trying to recoup it from every customer,” Webafrica said.

Webafrica said its approach of not penalising a downgrade would help make up for the cancellation fee in the case of the customer who first brought it to MyBroadband’s attention.

“They will save a substantial amount on their monthly subscription charge by simply ‘downgrading’ to our new 100Mbps package,” the ISP said.

“All we require from existing customers is to agree to the same terms and conditions that new customers agree to.”

With the 100/100Mbps package costing R110 less per month than the 200/200Mbps package, the cancellation fee would be almost completely accounted for within nine months of savings.

Webafrica prices shoot the lights out

Webafrica also told MyBroadband that comparing FTTH prices across major FNOs would show that its new prices were the best in the market by a significant margin.

We put this claim to the test and compared Webafrica’s prices with those of major ISPs like Afrihost, Cool Ideas, and Mweb.

Out of 35 packages across Frogfoot, MetroFibre, Octotel, Openserve, and Vumatel, Webafrica was the cheapest in 34 cases.

Our findings are summarised in the table below.

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Now read: South Africa’s fibre war