Telkom has defended its tariffs for voice and data services, arguing that independent research shows its prices are not excessive, or even expensive, when measured against its international peers.

Citing research by Tariffica, Telkom’s senior managing executive for enterprise markets, Brian Armstrong, says the company’s rates are competitive when measured against a wide range of developed and developing markets.

“Are we a global price leader? No,” says Armstrong. “Given our context, are we providing competitive value? We believe so.”

Telkom is often criticised for its tariffs, especially over the cost of its consumer broadband services. But Armstrong says prices are falling, pointing to a 90% reduction in international bandwidth prices in the past five years and steep reductions in its metro Ethernet and leased-line Diginet data services. “Diginet prices have come down 34% in nominal terms and 53% in real terms over five years.”

He says it’s unfair to draw a direct comparison with prices charged in “small, dense geographies” such as Iceland and Malta, which the Tariffica research shows have operators that charge lower tariffs than Telkom.

Prices will continue to fall, and Armstrong predicts the SA market will move increasingly to the European model of “all-you-can-eat” data and voice options.

“Because of growth in demand, competitive pressures and falling underlying costs, there will continue to be price declines in many of our product categories,” Armstrong says. — Staff reporter, TechCentral