Fibre in South Africa – More price increases are expected

Cool Ideas recently notified customers of changes in the pricing of several fibre packages.

The ISP said prices would increase on all its packages sold over network operator Openserve, while prices on all of the packages on Vumatel’s network except two have also been bumped.

Cool Ideas director Paul Butschi previously told MyBroadband that a number of network operators had informed them of changes in pricing for the provision of networks.

“We have already received notices from 4 fibre network operators, and whilst in the past, we have absorbed what we can, the realisation is that pricing will more than likely increase on a couple of networks as we have seen in the past,” Butschi said.

More ISPs could follow

The news could be just the first announcement of increases from ISPs coming in 2020, as RSAWEB’s Business Unit Head Wendy-Anne Bailey has also indicated price changes may be on the cards for its customers.

“As an ISP we are reliant on our Fibre Network Operators when it comes to pricing. We try and absorb those costs as much as we can, but if the providers increase their pricing due to inflationary costs, we too need to increase our pricing,” Bailey said.

The changes could be a mixed bag, however.

“Some providers have let us know there are price increases to be expected, but others have let us know their pricing will be staying the same this year. We have heard that some providers are dropping the cost of their higher line speeds which is some good news.”

MyBroadband asked several other major ISPs for comment on their fibre pricing for 2020, but most said they would prefer not to respond.

Fibre pricing in South Africa

Fibre to the Home (FTTH) has seen expansive growth in South Africa in recent years.

Although prices have gradually gone down in recent years, South Africa’s fibre Internet is still relatively expensive when compared to other countries.

A study by Picodi last year found that South Africa had the most expensive 100Mbps fibre Internet in the world.

Additionally, the research revealed many countries had fibre options at R300 or less, but no such option was available in South Africa.

Rollout in new areas

Current indications are that pricing will mostly either remain flat or might see a slight rise, but the good news is that the number of areas being served with fibre will likely increase in 2020.

Network operator Frogfoot recently announced it was rolling out fibre in Polokwane and will expand its footprint in Bloemfontein, East London, Ermelo, Middelburg, Pietermaritzburg, Richards Bay, and Witbank.

RSAWEB said many operators are looking at underserved locations.

“There is a renewed focus in areas previously overlooked. Many providers are planning to roll out to these areas with more competitive pricing which hopefully will be rolled out by RSAWEB too,” Bailey said.

Alternative solutions

For those looking to hedge their fibre package against price hikes, Cybersmart offers a prepaid fibre product called Free Fibre Forever.

Users pay a once-off fee of R3,999 to get 10GB data per month and 50GB night data per month indefinitely. These customers can also buy uncapped prepaid bundles for a set time period.

These bundles include R69 for one day of uncapped data, R1,199 for 30 days, and R5,699 for six months.

The total line speed for this package is 500Mbps, with users able to configure their own uplink and downlink rates.

Now read: The most popular fibre and LTE packages in South Africa

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Fibre in South Africa – More price increases are expected