Mobile broadband prices falling
Local mobile broadband provider Vodacom has recently announced that it will be reducing its price by 20% for most of its mobile data offerings, making its services attractive to a wider market.
International providers have however acted more aggressively to target fixed line customers.
Vodafone New Zealand recently dropped its data rates by over 66%, from $ 149-00 per GB to $ 49-00 per GB. This translates to under R 200-00 per GB in local terms. The mobile company made it clear that they aim to compete with the fixed line providers with this offering.
German owned T-Mobile has announced that it will be offering an unlimited data offering (read 2 GB) at 8.50 pounds in the UK, making it affordable enough to ditch traditional wired services.
While fixed line services are still more affordable, T-Mobile believes that it will be able to provide users with an attractive overall telecoms package.
“Although mobile phone customers will pay £8.50 (E12.33, $15.22) for unlimited data use, T-Mobile believes it can still undercut UK operators as customers will not need to pay a fixed phone line rental, although they will still be able to retain the sort of phone number currently used for fixed line,” The Business Online reports.
Locally we have not seen similar price wars yet, and it is not clear why mobile operators are hesitant to compete on price. This is especially true for providers like Sentech and iBurst where most of their revenue relies on data and growing their current user base.
Telkom’s high ADSL prices and crippled services have created a fertile environment for the mobile operators to effectively compete against the fixed line operator, but the mobile providers seem hesitant to take on the monopoly.
This conservative decision making has created an environment where Telkom can truly sit back and count its money as it has no reason to react to any real threats from other players.
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