Paul Jacobson

News just broke about MWEB’s new pricing for its ADSL offerings including a remarkable R219 for uncapped ADSL (for a 384 kbps ADSL line).

Businesses can expect to pay between R499 for 384 kbps DSL and R2 359 for up to 4 Mbps DSL. These prices are a little misleading and they vary depending on whether you are including ADSL line rental in your 12 month contract with MWEB (oh, yes, you need to sign a 12 month contract with MWEB).

The local Twittersphere has just gone crazy at the news with a number of people spreading the news as if it is the biggest ADSL news for the year to date. It is certainly fantastic news for MWEB subscribers who have been paying ridiculously high prices for their ADSL access so far. This pricing is not, however, the best pricing available to consumers or businesses. I don’t know how many businesses are still using 384 kbps lines unless their traffic is pretty much limited to email for a couple people so let’s assume more people will be using the faster connections. Once you are looking at pricing for the faster 4 Mbps lines, you can expect to spend around R2 000 for the pure data component with MWEB. Still not bad for an uncapped and unshaped ADSL connection, for sure. Well, until you consider Afrihost’s pricing …

You may be familiar with Afrihost’s R29/GB pricing offer which just seems to keep going. You may even be aware of the occasional double-up offer where you can buy 2GB of Afrihost data for R29. I just noticed that Afrihost is giving a lot of data away as part of its higher end packages (granted, the service is semi-shaped if that makes much difference to you):

I have a 50GB package with Afrihost and we tend to use around 60GB to 70GB on heavy months. 100GB is, practically, an uncapped package for us. I could probably find some way to use 100GB if I try hard (yes, I know it is easy to use that much data on illegal data transfers, I’m talking about the legal or semi-legal stuff) but it is quite a bit of data for R950. The price will probably revert to R1 450 for 50GB in June but that is still cheaper than MWEB’s equivalent, at least for me.

So, yes, MWEB’s pricing is great news for consumers, particularly its users who have been paying its absurdly high prices in the past but it isn’t exactly revolutionary for those of us who have been Afrihost customers (and other pioneers’ customers).

Welcome to the party MWEB, what kept you?

I had the misfortune of being disconnected from Afrihost this morning because my scheduled payment didn’t go off my card for some reason I suspect has more to do with Standard Bank than Afrihost (yes, there is money in the account). I didn’t receive the email from Afrihost telling me about this on my MacBook because, well, I was offline. I did see the email on my N97 though (it connects to MTN for my email access).

My immediate challenge was connected to the Afrihost site control panel. I thought I would be able to make a payment directly on the site using my card like I do when I top up my account. The reason why this is a challenge is that when you run out of bandwidth or if your account is suspended, you can’t even access the Afrihost client zone to top up your account or seek assistance on the site itself. This is pretty dumb and while I criticised Axxess for its relatively high prices, I could always access my Axxess control panel to top up my account or post a support request. Not being able to access the Afrihost site when you are out of bandwidth makes it a little difficult to do anything about it. You can’t top up your account using the online top up method or even get to your Internet banking service to make a manual payment (like I just had to do).

Fortunately I also have an account with G-Connect and this is where its Connection Manager came in really handy. The Connection Manager doesn’t require you to edit your router settings to connect to G-Connect. If you are plugged into a DSL capable router that is synching with the necessary switches or servers (or whatever these routers sync with), it will establish a connection to G-Connect and you are back online. As clunky as the Connection Manager can be, it worked well for me this morning when I needed it.

Anyway, I then connected to the Afrihost client zone and couldn’t find an option to pay the outstanding invoice directly. I could view the invoice but there doesn’t seem to be a button that allows me to pay it. The invoice listing doesn’t even tell me that the invoice is outstanding, I need to look at my connectivity information page to see that my account is suspended. Very unhelpful. Instead I have to make an EFT to Afrihost (got to be online for that), send Afrihost the payment confirmation (sent via fax and email) and wait for its accounts department to process the payment and reactivate my account.

My concern now is that because I made the payment from Standard Bank to ABSA bank (Afrihost’s bank), I may have to wait 2 to 3 days before my account is reactivated because that is usually how long it takes for inter-bank payments to occur. It is possible that my account will be reactivated now on the basis of my payment confirmation to Afrihost but I’ll have to wait and see if that happens.

In the meantime I am going to try find out why my payment wasn’t processed in the first place. This isn’t the first time I have had an issue with my card not being processed and my Standard Bank relationship managers still haven’t come up with a solution.

Rant.

Fact: we have expensive Internet connectivity compared to most of the developed world. You can throw a stone at a story about connectivity in SA without grazing a mention of the costs here compared to, say, the UK or the USA. Thankfully we do have developments like the Seacom cable, the upgrade to SAT-3 and a bunch of cables coming down the west coast of Africa which will boost the available bandwidth almost exponentially. We may even see Telkom drop its prices and increase caps and transfer rates … just maybe!

In the meantime we have a couple options that are better priced than most and offer pretty decent service. I used to be a loyal Axxess DSL customer but when it failed to take steps to reduce its pricing after G-Connect dropped its pricing to between R45/GB and R49/GB for ADSL access and Afrihost launched its limited duration and special R29/GB offer, I decided to switch.

I’ve been using G-Connect on and off for a few months now since Emerging Media sent me a SIM card and G-Connect gave me some credit to try the service out. Setting up the account on my laptop was easy with some terrific support from the G-Connect helpdesk. I focussed on the 3G access at first and it worked really well. It wasn’t until I moved away from Axxess that I started using the ADSL connectivity too. While I’ve enjoyed using G-Connect, the sign-on mechanism is a pain in the butt at times. Sometimes it just won’t connect me to the network but the support guys are terrific and I’ve had them call me a couple times with suggestions and to follow up with the support query. There are a couple pros and cons when it comes to the G-Connect service:

• Pro’s
• Pretty fast transfer speeds;
• Unshaped bandwidth;
• A single account for your ADSL, wifi and 3G connectivity;
• No commitment and your balance carries over month to month; and
• Excellent support (the support team are persistent).
• Con’s
• No concurrent connections;
• Cumbersome sign-on mechanism

I heard a couple reports about terrible customer service at Afrihost but the limited duration and special offer was too cheap to ignore. I decided to sign up and try it out and so far I have been pretty happy with the service I have been getting. I initially signed up for a 20GB service at R580 (compared to R490 for 8GB at Axxess) and I am moving up to a 50GB service next month at a cost of R1 450 (compared to the R1 475 I paid Axxess for 25GB). I occasionally have connectivity issues that seem to resolve themselves after a few minutes. As with G-Connect there are a few pros and cons:

• Pro’s
• Pretty fast transfer speeds;
• Up to 5 concurrent connections;
• Minimal commitment, you can cancel at around a month, I think (this is pretty standard);
• Excellent price and if you buy during the special you lock that price in
• Con’s
• Shaped bandwidth;
• No bandwidth carry-over so use it or lose it;
• Reportedly dodgy customer service (although I haven’t had any problems)

At the moment I use both G-Connect and Afrihost. Afrihost is my primary DSL provider but I have credit with G-Connect for when I can’t use Afrihost for some reason or I am out and about and MTN 3G is half GPRS (happens fairly often lately). I also maintain a 1GB data bundle on Axxess as a kind of “in case of emergency break glass” option but I don’t see myself going back there in a hurry. Granted the Afrihost pricing is not sustainable but the R49/GB price point seems to be where ADSL should be priced these days and Axxess’ refusal to revisit its pricing or make any effort to communicate with its customers about its pricing puts me off (Axxess doesn’t seem to be on the social media map and that says a lot to me about the company’s desire to engage with customers).

Of course it is worth mentioning Internet Solutions itself for a number of reasons. For one thing it is the underlying provider that powers Afrihost (as well as Axxess). Another reason is that IS has its own consumer offering called Plugg. Plugg’s offering isn’t terribly appealing from a price perspective. At R79/GB (apparently the price has been or will be dropped to around R65/GB) it is just not an option despite it potentially being pretty zippy due to what I understand are low contention rates (excuse any terminology mangling – I am trying to remember what smarter people in the know have told me). Plugg’s pricing is partly due to its relationship with its customers which it can’t really undercut without causing some trouble (those providers should be cutting their prices but that is besides the point, it seems). Instead Plugg is going to look at ways to really improve the value it adds to connectivity by adding a couple other services and options down the line. The fact that Plugg is an IS product automatically makes it worth watching but until there is better pricing and/or a more compelling offering there are better choices.

While I am talking about IS products I also want to mention its Mobility product. This is a corporate product and analogous to the G-Connect service in that it encompasses wifi and 3G access outside the office. It is a lot more than just connctivity and includes a really comprehensive management system that grants network managers a fine grained level of control over who has what level of access to which network. It seems to be a pretty powerful option for corporates who want to give their people the ability to work remotely and at the same time control how they do that and even how they interface with the corporate network. I haven’t used much more than the 3G connectivity on my phone (like G-Connect you can provision your SIM to run on the IS network rather than your usual provider). I just couldn’t figure out how to get the 3G dongle working with my MacBook for some reason. This mention really doesn’t do the offering any justice. I just wanted to mention it here as a powerful corporate option that also comes with some competitive pricing.

Although pricing has hardly plummeted while bandwidth caps and transfer speeds have rocketed, we are seeing some very welcome relief when it comes to pricing and the flexibility to switch from provider to provider (well, assuming you weren’t nailed down by Telkom or some other larger provider). Even at R49/GB ADSL is becoming much more affordable and providers like G-Connect and Afrihost are putting some pressure on their competitors to do better. I would love to know the number of users other DSL providers lost when Afrihost announced its special offer. That must have been noticeable. I’m pretty happy with my current choices although what I’d like to see is improved upload speeds. That is the next big thing, I think.

News of Afrihost’s special offer has spread like wildfire and for good reason. Afrihost is offering ADSL connectivity for a low R29 per GB which is probably the lowest price in South Africa at the moment.

I am currently an Axxess customer and I just called Axxess to find out if they have any price drops planned. The sales person I spoke to said I should keep an eye on their website over the next 2 months or so because they are “looking into” reducing their prices. I pointed out to her that Axxess is going to lose a bunch of customers because Afrihost’s special offer is only valid for a limited time period. She asked me if I am a customer and I said I am an Axxess customer but I use a fortune of data (35GB this month so far) and it is costing me a bomb. She basically just told me to keep an eye on the site.

Being the lawyer I am I just called Afrihost and asked for the fine print for their ADSL offering. They don’t seem to have any but I did find out the following:

• if you have exceeded your cap you will be directed to the Afrihost control panel to top up your bandwidth;
• if you ever want to cancel your account you will have to give Afrihost 1 month’s notice (I suspect other providers like Axxess have the same notice requirement so bear this in mind if you want to leave your current provider for Afrihost); and
• the special offer was supposed to end today but the call centre guys have been told to keep selling the cheaper packages for the time being.

There is no doubt the Afrihost offer will attract a number of new customers. I am seriously tempted by the 50GB package at R1 450. It is cheaper than my bandwidth at Axxess is costing me for a lot less and given my current usage, 50GB is practically uncapped for me. Another big plus is that Afrihost’s ADSL allows for 5 concurrent connections and if I understand that correctly, that means my family can also use my account for their DSL needs. That translates into an even lower cost all around.

The Afrihost guys seem to be pretty confident that they have shaken up the local ADSL industry and they probably have. It remains to be seen what the post-special offer price will be although I doubt very much it will be much more than around R49 per GB which is what G-Connect is charging for ADSL on the high end.

What is clear is that pricing ADSL at anything more than R59 per GB for simple ADSL is foolish and we should see other providers drop their pricing sooner rather than later. Either that or those providers will start to fall away as serious competitors.

That just leaves you with one question. Have you signed up with Afrihost yet? I’ll be exiting the Axxess offramp shortly after about 2 years as an Axxess customer.