Will Work for Bandwidth...

Having recently returned back to South Africa from a 5 year stint in the UK I still cannot believe how expensive it is for data connectivity whether it be mobile, WiFi or ADSL. Yes the prices have come down quite a bit but lets be honest it's nothing to right home about.

Even before getting a broadband account from a service provider you need to have the phone line enabled which also means you need to have a phone service. So you pay for an ADSL account and you pay for the service to be enablede, what the hell? That would be the same as charging mobile users to have wifi enabled on their devices as well as a data plan for the service, wouldn't it?

The only conclusion I can come to on this is that goverment wont remove this as long as they keep their fingers in the Telkom pie.

ADSL
I recently joined one of South Africa's well known ISP's and during our induction I couldnt help but think constanly about what one of the presenters said. Bearing in mind this gentlemen is part of the sales team. The discussion was around connectivity costs in South Africa and how it is becoming harder and harder to make a profit off bandwidth sales. Fair enough, but it was the actual comment afterwards that suprised me. "Becareful what you wish for. In the 1990's we could sell a 64k line for around R65k/pm, today with so much competition prices are driven down and it's harder to make profit." Now I am all for a company doing well, heck they pay my salary, but isnt that the point? Get costs down so we can have more subscribers?  Isnt that called supply and demand?

I believe we are still grossly over paying for any bandwidth accounts in South Africa. I was lucky enough to have a 24Mb BT account for around R120pm and this service was uncapped with a free wifi router. 

There is more light at the end of the tunnel with the WACS cable being roled out on the west coast of africa. The design capacity is for 3.84 Tbit/s and the participants are Neotel, Telkom, MTN, Vodacom and Broadband Infranco. Hopefully this will bring down prices in line with European providers, but dont hold your breathe on that one.

3G cost's are just as ri-donk-culous which I will pick up on in a future article.

Hosting
Working for an ISP doesnt mean free hosting. I wanted to start my own little business when I arrived back home just to make a little extra moola on the side. I was shocked to see we are no where near competitive in the hosting arena either. Unless you run a streaming or banking site why would you host your site in South Africa? We are charged more for the hardware and per MB of traffic. SiteGround.com offers you unlimited bandwidth and storage on your hosted solution for as little as $10pm.

So why is it so expensive for "connectivity" in South Africa?

Well I am pretty sure if you call your ISP they will blame Telkom straight off the bat. You will also most likely be told that peering costs with other ISP's is expensive, but at the end of the day we face the same challenges as other countries who have already implemented or trialing 1Gb Adsl with success, at less than half the price we offer on our 10Mb accounts.

I fear that we are just moving forward to slowly in an industry that could provide billions of rands in revenue. Providing call centres or a perfect location for overseas companies to host disaster recovery sites would be ideal for South Africa as we are not a terrorism target. None of this will happen unless something is done to put us up there as a competitive country in the telecoms industry.

Just sit down for a few minutes and calculate what percentage of your net salary goes on "connectivity", it's an interesting insight.

I would greatly appreciate your feedback on this article, onformative, critical or other, via the comments section.