When Mweb announced uncapped Internet in this country, the market went crazy. Competitors followed with similar offerings within days and analysts announced the breaking of a new dawn. Most people failed to mention that it was a rip and in everyone’s enthusiasm, the point that the product is not worth paying for got swept under the carpet.
Now the part about it being not worth paying does not apply so much to businesses or hardcore gamers who download 150 GB of data or more a month. Let’s look at the rest of us.
The truth is that ISPs looked at a simple model. And let’s put it in cooking terms to make it more accessible. If you walk into a restaurant and there is a big sign that says, “R200 buffet (no sharing)” you’d kind of go, what’s the point?
But that’s exactly what the ISPs did. To prove it lets look at some numbers.
On a 4MB line, the fastest available to most people on ADSL, Telkom charges R554 (Telkom Do Broadband 3), which includes your line rental (please take note of that), 5GB of bandwidth and 30 GB of local bandwidth once you have reached cap. If you don’t understand the last part, focus in on R554 all in, ok? (Even the modem which is free on contract. MWeb charges R599.)
So far everyone with me? Right. Now let’s look at MWeb as an average (the other providers are generally similar in price). For the line rental on a 4MB line and uncapped bandwidth, MWeb charges R899. (Don’t only look at the R539 price – that is only bandwidth).
So if we take R899 all in and we minus R554, we get R345. So how much bandwidth would you have to purchase to spend R345 before uncapped becomes worth spending the money?
Well let say you use Afrihost – they are the cheapest sellers of bandwidth in the country. So the scenario – you use the Telkom 5GB until you hit cap. And then at the push of a button your switch to Afrihost. If you buy 1GB a month and then top up, they sell bandwidth at R29 per GB.
So R345/R29=11.9 GB. So if you have the Telkom package which gives you 5GB and you use that all up and then purchase and additional 12GB (rounded off), only then will uncapped start being worth it. That’s almost 18GB of bandwidth a month before uncapped becomes worth it! Oh wait. And if Afrihost are running their buy-one-get-one-free option, which they have run every month for the last six months or so, after the first GB at R29, every R29 thereafter gets you 2GB. So in this scenario you’d get 27.8GB of bandwidth before uncapped became worth it.
To give you some perspective, I use between six and nine GB of bandwidth a month and that’s pretty heavy for a normal user.
But you don’t need a 4MB line you say? Ok let’s run it on the lowest 384k line speed. Telkom option, R199 for their Telkom Do Broadband 1) MWeb price is R349. The difference between the two is R150. If you divide that by R29 you get 5.2GB of bandwidth. So if you add the 1GB you get with Telkom and the 5.2 GB you’d top up with, then you would have to use 6.2GB of bandwidth before uncapped became viable on a 384 uncapped package from MWeb.
And this is before we even get into the fact that Seacom has been down on numerous occasions. It has currently been down for several days and they are hoping to restore it on 22 July, seven days from now. In the mean time, uncapped providers are making contingency plans which offer a poor and sometimes unavailable service to their users while they limp along.
I think I have made my point.