SA ADSL price cuts: ISPs respond
On the backdrop of recent wholesale ADSL price cuts, South Africa’s ISPs have responded in kind by rolling out new products, pricing and data packages that filter down the saving and extra value to consumers.
On the 30th of March, 2012, The Independent Communications Authority of South Africa (ICASA) announced that wholesale ADSL IPConnect (IPC) prices had to be dropped by 30% from 1 April 2012.
The price cut was welcomed by ISPs as it offered more breathing room in terms of pricing, and also provided them with a chance to restructure and feed some of the saving down to their customers.
MWEB price reduction
MWEB cut the price of its 1Mbps uncapped ADSL service from R299 per month to R199 per month, and is offered all of its 384kbps uncapped subscribers a free upgrade to 1Mbps accounts.
MWEB ISP CEO, Derek Hershaw said that it is in-line with their aim to make 1Mbps Uncapped ADSL the new entry-level uncapped product in South Africa.
MWEB Business also reduced the price of its business uncapped 1Mbps service from R986 per month to R799 per month.
Axxess 10Mbps
Axxess has been the lastest ISP to cut its uncapped ADSL prices after the wholesale reduction, announcing a reduction in its 384 kbps and 1Mbps uncapped ADSL packages, as well as launching a 10Mbbps uncapped service.
“We have just updated our uncapped pricing (on 384kbps and 1024kbps justUncapped) to pass on the new IPC savings from Telkom to all our existing and new clients,” Axxess marketing director, Franco Barbalich, told MyBroadband.
Cybersmart uncapped
Cybersmart MD, Laurie Fialkov said that the IPC price cut, as well as new hardware investments the company has made, made it possible for them to offer an uncapped ADSL product.
Cybersmart is planning to launch its home uncapped product before 1 June, with its business uncapped ADSL service following towards the end of the year.
Afrihost ADSL boost
Afrihost chose to deliver the IPC price cut in a different way, by providing more data for the same price. The new data limits on capped accounts brought per-gig prices down to as little as R8.
Afrihost said it would also be reviewing its regular and business uncapped prices. “Though no official figures are available, [the prices] will at minimum match competitor rates,” said Afrihost director, Greg Payne.
OpenWeb
Openweb immediately reacted, cutting the price across their 1Mbps uncapped product range
The ISP also announced it would be providing better value to ADSL users with new capped, unshaped ADSL data bundles.
“Telkom have dropped their IPC charges. ISP’s have been waiting for this drop for a long time. We thought the consumer should not wait any longer for cheaper rates,” said Keoma Wright, Founder of OpenWeb.co.za.
FNB Connect
FNB’s ISP arm responded to the cut by offering its banking clients additional free ADSL data – giving qualifying customers between 1GB and 5GB of free data a month.
“We think that there’s an opportunity to reward customers more through rewards programmes like eBucks or fuel rewards, and in some cases to disrupt other industries,” said FNB’s CEO, Michael Jordaan.
“In our case, we thought the telco industry is one where we can bring significant free benefits to our customers.”
The rest
Web Africa’s COO, Rupert Bryant said that while they had just released their new Home ADSL packages from R7.99 per GB, their uncapped service would be next on the roadmap for review.
Vox Telecom and Telkom Internet are yet to announce any price shifts or reductions as a direct reaction to the price cut, however, Vox’s Clayton Timcke said that the ISP “will definitely also challenge the status quo.”
Telkom Internet has alluded that there isn’t any plan to cut prices.
“Telkom Internet is continuously reviewing its pricing but places a larger significance in offering value differentiation to its customers, both Business and Consumer. The ISP’s products are designed toward sustaining good network performance,” it said.
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