Over the last few months we’ve seen intense competition around call and data tariffs from local cellular providers. But what happens when we combine the two to make voice calls using data?
Skype has become the standard voice over IP (VOIP) solution, gaining tremendous popularity since its launch in 2003. Calls are free between two Skype users, but if you use Skype to call a landline or a mobile line, you’ll have to pay. Even then, it has extremely competitive tariffs – often besting those of the country you are calling from. In the US, on AT&T’s cheapest calling plan (450 minutes/$39.99) it’s cheaper to use Skype to call people in the US than than using your AT&T minutes.
Of course, Skype also uses data. Use it to make a call to America and you’re paying for both the data you’re using as well as the Skype call tariff. This has to be taken into account, especially here where we pay a lot for data bundles and even more for out-of-bundle data usage.
It gets even more complicated, when trying to break down the tariffs and find out what the cheapest solution is for making calls. This isn’t helped by the fact that there are tariffs for each country in the world. And then tariffs for landlines and separate tariffs for each of the mobile providers in a country. Calling somebody in Zimbabwe costs R1.58 if you use a Telkom land line to make the call. Using the same landline to call a cell phone in Zimbabwe can cost between R4.29 and R5.17. Then there are cheaper rates for calling during off peak hours.
In an effort to simplify things, we’ve chosen some popular calling destinations and compiled tables to indicate what it would cost to make calls using a Telkom land line, a Vodacom or Cell C voice line, and then Skype, including data charges.
With the complicated numbers out of the way, but neatly arranged in a table, we can start doing the maths. Skype’s let down by its connection fees, which means that conventional call providers have the edge when it comes to calls of a shorter duration. However, average it out over 10 minutes, and things even out.
A 10 minute call to Australia on Skype will use 10MB, which, at Cell C’s nominal data rate of 15c per MB, works out to R1.50 in data charges. Add a 50c connection fee and the R2.30 for 10 minutes of talk time (deducted from your Skype credit), and you’ll pay R4.30 for a 10 minute call.
The same call using Vodacom’s data rates is a bit more complicated, since it depends on which bundle you use. Sadly, Vodacom doesn’t make it easy to get a single tariff for any one bundle, but let’s use its cheapest data deal: R39 for 500MB. Quick maths gives us a rate of 7.8c per MB, so a 10-minute Skype call to Australia will cost 78c in data, plus R2.30 in Skype credit and a 50c connection fee (total R3.58).
Both of these are vastly cheaper than using a Telkom line (R7.50), and even its off-peak rates don’t help. Vodacom and Cell C’s voice rates for calling Australian land lines also don’t hold a candle to the Skype + data alternatives, when it comes to cost. In fact, for all the foreign countries in our graphs it’s cheaper to call land lines using Skype.
There’s a huge problem, though: nobody really uses land lines. Skype will be great if you’re phoning an office or hotel, but most of your friends or family are more likely to be reached on a mobile phone. And that’s where the VOIP service simple cannot match in the majority of cases.
Calling an Australian cellphone for 10 minutes, using Skype? R23.20 using Cell C bandwidth, or R22.48 on Vodacom’s calculated rate.
While Telkom isn’t competitive when calling Australian mobiles, doing so from Vodacom or Cell C is less than half the total Skype price. R8.90 on Vodacom, and R9.99 on Cell C (again, for 10 minute calls).
For two of the most popular destinations Telkom does manage to come out on top, compared to the mobile networks. It charges only 60c per minute for calls to the US and UK. R6 for a 10 minute call is more than reasonable – though that does exclude the monthly line rental. One curiosity is the US. Given the nature of VOIP (which uses least-cost routing) it’s possible for Skype to charge a single flat fee when calling both land lines and mobile numbers in the USA. That means you pay R2.30 in Skype credit for a 10 minute call; just add your respective service provider’s bandwidth charge and it works out to be very cheap.
Now we know that Skype is far cheaper when calling land lines abroad, while it’s not the case when it comes to mobile numbers. Bandwidth on local mobile networks has become so affordable that the data used for a 10 minute phone call doesn’t really figure into a budget.
Hoping to ditch your voice bill altogether and use Skype exclusively? There is hope. While Skype’s regular rates don’t work out favourably, it does offer subscription plans that make far more financial sense. For $3.99 (R40) or $7.99 (R80) a month you can have 60 or 120 minutes, respectively, to call both land lines and mobile numbers in South Africa. The nominal rate works out to 67c per minute – cheaper than any mobile provider, and cheaper than Telkom if you’re not calling land lines exclusively. Even if you include data costs – 120 minutes will need less than 150MB of data – it’s a huge bargain.
For €50 (around R650) a year you can also have a South African phone number tied to your account, through Skype. People can dial it and your Skype device – whether phone or laptop – will ring just like a land line or mobile phone does.