The South African telecommunications market has started to see the benefits of liberalization in the form of cheaper international bandwidth – brought about by SEACOM’s arrival – and more affordable ADSL bandwidth.<\/p>\n
The price of low end broadband services has however not showed much movement. Some industry players have said that the price floor for a broadband service most likely sits at between R 200 to R 220 per month, and Telkom recently said that their R 199 Do Broadband ADSL service is very close to cost.<\/p>\n
We investigated the total cost of ownership of the main entry level broadband offerings. A 1 GB package was selected as this is widely used as a low cost Internet connection in South Africa.<\/p>\n
The ADSL Internet Service Provider (ISP) market is very competitive in South Africa which means that consumers can get ADSL packages for as low as R 135.00 per month which includes both ADSL access and 1 GB data charges. For this pricing comparison Telkom’s Do Broadband Level 1 service was used without the self-install option and incorporating the most affordable Telkom ADSL Modem.<\/p>\n
While Telkom’s DSL384 service emerged as the most costly offering, it should be noted that the service has a few benefits over competitors, including more affordable ‘out-of-bundle’ bandwidth and 10 GB free local bandwidth. It is however far slower than competing wireless offerings.<\/p>\n
The following table provides a pricing comparison for the total cost of ownership of a 1 GB broadband service over a 24 month period. In most cases the 24 month contract prices were used which includes a modem.<\/p>\n
| \n 1 GB Broadband Service: Total Cost of Ownership<\/span><\/strong><\/div>\n<\/td>\n<\/tr>\n Service<\/span><\/strong><\/td>\n | Installation\/Activation<\/span><\/strong><\/td>\n | Equipment<\/span><\/strong><\/td>\n | Montly Cost<\/span><\/strong><\/td>\n | 24 Month Total<\/span><\/strong><\/td>\n<\/tr>\n | iBurst Wireless<\/td>\n | R 99.00<\/td>\n | —<\/td>\n | R 219.00<\/td>\n | R 5355.00<\/td>\n<\/tr>\n | Telkom Do 3G<\/td>\n | R 199.00<\/td>\n | R 581.25<\/td>\n | R 219.00<\/td>\n | R 6036.25<\/td>\n<\/tr>\n | Neotel NeoConnect Prime<\/td>\n | —<\/td>\n | —<\/td>\n | R 279.00<\/td>\n | R 6696.00<\/td>\n<\/tr>\n | Vodacom HSDPA<\/td>\n | R 99.00<\/td>\n | —<\/td>\n | R 349.00<\/td>\n | R 8475.00<\/td>\n<\/tr>\n | MTN HSDPA<\/td>\n | R 99.00<\/td>\n | —<\/td>\n | R 349.00<\/td>\n | R 8475.00<\/td>\n<\/tr>\n | Telkom DSL384 Do1<\/td>\n | R 1066.36<\/td>\n | —<\/td>\n | R 330.00<\/td>\n | R 8986.26<\/td>\n<\/tr>\n<\/tbody>\n<\/table><\/div>\n | |