{"id":609955,"date":"2025-09-06T09:58:30","date_gmt":"2025-09-06T07:58:30","guid":{"rendered":"https:\/\/mybroadband.co.za\/news\/?p=609955"},"modified":"2025-09-06T10:00:14","modified_gmt":"2025-09-06T08:00:14","slug":"fibre-has-one-big-problem-in-south-africa","status":"publish","type":"post","link":"https:\/\/mybroadband.co.za\/news\/broadband\/609955-fibre-has-one-big-problem-in-south-africa.html","title":{"rendered":"Fibre has one big problem in South Africa"},"content":{"rendered":"\n

The Competition Commission has published its inaugural Cost of Living report, which found that fibre Internet prices have increased faster relative to inflation than mobile and fixed wireless broadband.<\/p>\n\n\n\n

Expanding on its Essential Food Price Monitoring report first published in July 2020, the competition watchdog said its new report captures a more inclusive and representative view of household economic realities.<\/p>\n\n\n\n

Prepared by Andiswa Sibhukwana, Tiisetso Lerumo, and Raksha Darji, the Cost of Living report found that Internet usage costs for wired and wireless connections remain below general inflation.<\/p>\n\n\n\n

The report relied on Consumer Price Index data and pricing data published by Stats SA and the Independent Communications Authority of South Africa (Icasa) bi-annual tariff analysis report.<\/p>\n\n\n\n

\u201cStats SA collects data monthly through direct enquiries with Telkom and other cell phone operators. The data is only available from 2022, as such, earlier analysis was not possible,\u201d the report noted.<\/p>\n\n\n\n

While the retail price growth of Internet access in South Africa is below headline inflation, the report found that wireless Internet only increased by 1% since January 2022, whereas fibre increased by 14%.<\/p>\n\n\n\n

\u201cAccess to the Internet is now considered an essential service similar to electricity and water supply rather than a luxury item due to its importance in the everyday lives of South Africans,\u201d the report stated..<\/p>\n\n\n\n

\u201cIt is therefore important that affordable, reliable Internet access is available to all, including those living in remote areas.\u201d<\/p>\n\n\n\n

The report argues that data prices in South Africa decreased significantly following the recommendations of the Competition Commission\u2019s Data Services Market Inquiry in 2019.<\/p>\n\n\n\n

It said Icasa\u2019s tariff analysis from 2017\/2018 shows that Vodacom, MTN and Cell C charged R149 for their 1GB data bundle, while Telkom Mobile charged R99.<\/p>\n\n\n\n

\u201cFollowing the Commission\u2019s intervention, data prices fell for all major operators, most evidently in 2020 and 2021,\u201d the Cost of Living report stated.<\/p>\n\n\n\n

\u201cThe 2020 Icasa report illustrates that Vodacom, MTN, Cell C and Telkom Mobile reduced their 1GB data bundle prices by 33.6%, 33.6%, 36.3% and 1% respectively. Prices have since remained stable.\u201d<\/p>\n\n\n\n

It should be noted that Icasa\u2019s tariff analysis only considers the price of permanent packages that Internet service providers file with the regulator.<\/p>\n\n\n\n

Icasa does not track the prices of promotions or personalised deals that mobile operators like Vodacom and MTN have started offering customers.<\/p>\n\n\n\n

\"\"
Competition Commission 2025 Cost of Living report: Internet Usage Cost (IUC) increases for wired and wireless services relative to the overall Consumer Price Index.<\/figcaption><\/figure>\n\n\n\n

Why mobile data prices fell<\/h2>\n\n\n\n

The mobile operators also didn\u2019t simply reduce their sticker prices on data because of the Competition Commission\u2019s recommendations.<\/p>\n\n\n\n

There were negotiations between the operators and the Commission, where the carriers explained that they could reduce prices provided they received certain assurances from the government.<\/p>\n\n\n\n

Chief among these was that additional radio frequency spectrum \u2014 the raw network capacity that is the lifeblood of any wireless network \u2014 became available soon.<\/p>\n\n\n\n

Unless Icasa assigned more spectrum for 4G and 5G deployments to South Africa\u2019s cellular networks, Vodacom and MTN warned that prices would have to go back up.<\/p>\n\n\n\n

Icasa then released spectrum on an emergency basis during the Covid-19 pandemic for operators to capacitate their networks to help while people sheltered in place.<\/p>\n\n\n\n

In 2022, Icasa held a spectrum auction, allowing for a more permanent assignment of the precious network resources.<\/p>\n\n\n\n

Vodacom and MTN each spent more than R5 billion<\/a> on their additional spectrum \u2014 costs they must still recoup.<\/p>\n\n\n\n

However, despite the cost, having the spectrum resources in hand has allowed the price decreases that the mobile operators negotiated with the Competition Commission more than five years ago to remain in effect.<\/p>\n\n\n\n

The fibre challenge<\/h2>\n\n\n\n
\"\"<\/figure>\n\n\n\n

According to the Competition Commission\u2019s Cost of Living report, the most notable increase in wired (i.e. fibre) Internet usage costs occurred in the July\u2013August 2022 period, where it increased by 7.4%.<\/p>\n\n\n\n

\u201cThis increase can be attributed to a few fibre network operators pricing their products above the average market price,\u201d the report stated.<\/p>\n\n\n\n

\u201cFor instance, 20\/20Mbps line speeds average monthly price across the sample was R726.\u201d<\/p>\n\n\n\n

What the report\u2019s data does not encapsulate is that fibre entry-level pricing has remained relatively stable, while line speeds have increased.<\/p>\n\n\n\n

In other words, fibre network operators have frequently implemented speed upgrades without increasing prices.<\/p>\n\n\n\n

This has caused 20\/20Mbps packages to disappear in middle-class neighbourhoods, with 50Mbps+ lines becoming the new entry-level.<\/p>\n\n\n\n

On the other hand, mobile operators offer fixed wireless access products from prices around the R300 per month mark, which are attractive to families feeling the pressure of South Africa\u2019s poor economic growth.<\/p>\n\n\n\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

The Competition Commission has published its inaugural Cost of Living report, which found that fibre Internet prices have increased faster relative to inflation than mobile and fixed wireless broadband.<\/p>\n","protected":false},"author":15,"featured_media":498749,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[62528,4,28470],"tags":[3222,101342,887,57366,27607],"class_list":["post-609955","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-5g","category-broadband","category-fibre","tag-competition-commission","tag-cost-of-living-report","tag-fibre-1","tag-fibre-prices","tag-inflation"],"_links":{"self":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/609955"}],"collection":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/comments?post=609955"}],"version-history":[{"count":2,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/609955\/revisions"}],"predecessor-version":[{"id":609958,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/posts\/609955\/revisions\/609958"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media\/498749"}],"wp:attachment":[{"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/media?parent=609955"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/categories?post=609955"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mybroadband.co.za\/news\/wp-json\/wp\/v2\/tags?post=609955"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}