At a press conference this morning the Independent Communications Authority of South Africa (ICASA) launched its Cost to Communicate programme, designed to address the high cost of communication and bandwidth in South Africa.
Pieter Grootes, the regulator’s general manager of markets and competition called for 40Mbit internet connections to cost R329 per month. Grootes insisted that that while it sounds unbelievable, Maboneng Broadband – a cable company in the city of Johannesburg – already provides this exact service with a 20GB cap.
Of course, it’s one thing to provide fibre to companies within range of your servers and net connection for a start-up, quite another to upgrade street cabinets and exchanges for supplying that kind of service over the public telephone network.
It’s unclear right now – although we are asking – whether the intended price would include all costs for an internet connection. Presently the cost for an VDSL or ADSL line includes three separate items. Line rental, for the copper line, goes to Telkom. This accounts for around R150 of costs. Then there’s services rental for DSL which, at current prices, costs between R165 (1Mbps) and R795 (40Mbps). Finally, the bandwidth portion has to be paid to an ISP. Depending on the monthly allowance (cap) this can cost from R15 for 1GB, to R2 500+ for an uncapped account.
The Cost to Communicate program will have a study on the broadband value chain, reassessment of mobile termination rates, local loop unbundling, and broadcasting regulations.