Uncapped Internet: Telkom goes on the offensive - TechCentral

Uncapped Internet: Telkom goes on the offensive

Telkom Towers in Pretoria

Telkom has hit back at the introduction by MWeb and other Internet service providers of uncapped broadband, accusing rivals of “not delivering on their promise”.

In a newsletter sent out to Telkom subscribers with their monthly bills this month, the incumbent fixed-line operator climbs into its competitors without naming them.

“The introduction of uncapped broadband was supposed to bring with it pure Internet joy, but it’s become very clear that all that joy is subject to terms and conditions that are hidden in small print,” the newsletter says.

“It’s unfortunate, but that’s what you get when you buy uncapped broadband in SA. Many service providers talk the talk, but don’t deliver on their promise.”

The newsletter goes on to talk about Telkom’s Do Broadband products, and how they supposedly offer better value than the uncapped offerings from the company’s rivals.

It markets the fact that its 1GB Do Broadband Level 1 product, which costs R199/month, also offers 10GB of “free” local bandwidth, a 3GB mailbox and access to Encyclopaedia Britannica online. “You can choose to buy another 1GB for R64,76,” it says. “The total will be R263,76.”

The company then lays into rival MWeb, without naming it: “The entry-level package from other providers that includes ADSL will set you back R349. That’s R86 EXTRA [Telkom’s emphasis] per month!”

Telkom's newsletter (click for larger version)

Telkom says “the truth” is that “many people don’t use all their allocated data per month. Now, by going the uncapped way, you’re most certainly subsidising someone else and you get zilch in return.”

The newsletter concludes by saying that there are offers in the market that, at face value, look cheaper than its Do Broadband products. “However, they do make make provision for 10GB FREE [Telkom’s emphasis] local data that gives you access to locally hosted websites like your banking institutions.”

The newsletter — clearly aimed at stopping Telkom customers from switching to another Internet service provider — may backfire on the fixed-line operator. The company’s broadband customers have long complained about Telkom’s aggressive bandwidth capping policies and perceived high prices.

Analyst and researcher Arthur Goldstuck, MD of World Wide Worx, says Telkom’s Internet service provider will lose market share if it doesn’t respond to the improved offerings in the market from the likes of MWeb.

“I’m not suggesting Telkom needs to match other service providers gigabyte for gigabyte, but they do need a new mindset in terms of what they give the customer — not the rations they are doling out at the moment,” he says.

“The market perception is that uncapped broadband is now the market trend and if Telkom doesn’t offer it, people will choose other service providers.”

However, Goldstuck says Telkom is still in a controlling position in the market. Even if consumers desert its Internet service provider en masse, it will still collect the lion’s share of revenues in the broadband market due to its monopoly control over the fixed-line network.  — Duncan McLeod, TechCentral

28 Comments

  1. Garth Michel on

    As soon as my conttact is up, I’m off Telkom, unless they do something fast. I’d even settle for a 30gb cap, but thier current caps have to go.

  2. The_Librarian on

    A 3Gb or 4Gb cap is too small to be of any useful value. They should start looking at entry-level caps of 30Gb.

    My company will be ditching Telkom/SAIX due to their ridiculous pricing and go with somebody else who’ll offer us more for the same amount of money.

    Also, Telkom only compared the uncapped offerings with their capped offerings – but they didn’t compared, for example, AfriHost’s 10Gb capped offering with their piddly 4Gb capped offering.

    And what good is 10Gb local bandwidth for a company which do need international connectivity?

  3. What a load of codswallop. My first month with Afrihost saw me use over 30GB on my 384k line. Between managing multiple streaming webcams and updating my Linux distros and downloading a 100 other things I wanted, I have pulled well over 90GBs since April. Telkoms crappy Do Broadband offerings would have cost me thousands of Rands in additonal 1Gb topups.

    Telkom are just trying to bamboozle their remaining customers by trying to fit their “round-peg” offerings into the uncapped “square-hole” offerings. You cannot comapre a capped product with an upcapped product.

    It would be great if the likes of Mweb or Afrihost released some sort of usage averages on their uncapped accounts across their user base. Then Telkom could try and tell me their products can compete Rand for Rand.

  4. I’m a very happy mweb 4mbit uncapped subscriber. Telkom’s pulling a WebAfrica here, and instead of actually putting out a product, they’re just trying to retain customers by badmouthing the competition. This hasn’t worked for them, customers have left WA in droves for Mweb ,and most of them are happy at their new home.

    I disagree with Arthur Goldstuck when he says
    >“I’m not suggesting Telkom needs to match other service providers gigabyte for gigabyte, but they do need a new mindset in terms of what they give the customer — not the rations they are doling out at the moment,”

    Telkom need to not only match, but beat all the other providers. 6 months ago, MWEB was despised as an ISP, probably in the same league as Telkom, their uncapped offerings turned that around in almost no time, and they’re much loved by most the local internet community.

    If Telkom came out with some amazing products at great prices, I’m sure that people would forget the evils of their past in a heartbeat. I know I would. I don’t care where I’m getting a good deal from, so long as there are no catches. Hell, I’d buy my connectivity from one of Julius Malema’s companies if it were a better product than everyone else!

  5. HONESTLY, WHO REALLY NEEDS 10GIGS OF LOCAL CAP,, IT’S NOT LIKE MOST SOUTH AFRICANS BROWSE LOCALLY ANYWAY, EVEN WHEN WE DO, WE WILL USE AT MOST 500MB PER MONTH LOCALLY, COME ON TELKOM, WE’RE N0T STUPID!

  6. Guerilla tactics and inflammatory remarks. Nice anti-competitive behaviour, Telkom.

    I can’t wait to do 10GB worth of bank transactions with Standard Bank. Or make 10GB worth of comments on the ****ty local websites (TC excluded). Thanks a lot, Telkom.

    Perhaps a study can be conducted to disprove some of Telkom’s claims.
    People have bandwidth left over at the end of the month? Well, you see, it’s like this: if I earn R1000 a month, I’ll budget for that and hope to have some left over, so as not to incur an overdraft.

    If I had an unlimited trust fund, I’d use it for everything I needed or wanted, without worrying about running out of money. Sure, I’d abuse the crap out of it for a month or two, but after I’ve got the house, Ferraris and snorted coke off a hooker’s ass, I’ll probably settle down, spending the rest of my days sipping piña coladas at the pool.

  7. this reminds me of david and goliath. the lumbering giant is being brought to its knees by competition it could squash with its eye lash. sad to say it but telkom is around 5 years behind the rest of the market, in everything.

  8. Telkom is still way behind, they’re not going to improve speeds for low-end users, their cost per GB will never come down below R64.76 – geez? Big bloody deal, Telkom, you have been ripping us off for centuries already and youre going to continue doing just that. It’s time Telkom went bust and someone else took over.

  9. Telkom would have done a better job of punting Local Internet if they had the insight to make local internet easier to navigate. At least IS supports locallist.co.za. The value proposition of local internet is unfortunately not enough to convince me not to consider Mweb though (throttling or not).

  10. I agree wholeheartedly C, but do check out locallist.co.za to see what you can do with your 10GB of local traffic. There is a bit more than banking and news sites.

    P.S. Not a plug, I’m not affiliated with locallist 🙂

  11. Telkom are the only ones who believe their own Bull****. That’s what happens when you get your own head stuck up your ass! The lost opportunities because of their greed will haunt them.

  12. if most people dont use all of there gigs by the end of the month, then why wouldnt they go uncapped, think about it they would be makin a hell of allot more money if they sold uncapped for 300 bucks instead of people only using 1 plus half of the other gig they bought on top up as this would only give them 260 bucks. it may be true that some people only use one gig but for us youngsters who manage to use in excess of 5 to 10 giggs just on social networking and normally during off peak times paying a grand plus for this is just to much. telkom will lose the youth( the youth that will one day be running there own bussineses). the rest of the world has gone uncapped and pretty cheap to. so a big shout out to the old farts at telkom. catch a wake up or lose the dough

  13. btw if telkom is trying to ensure that we pay only for what we get why do they have a use it or lose it policy, i should be able to bank what ever gigs i dont use in a month or year to use on a busy month.

  14. Keith Farrell on

    I find telkom full of bs anyhow, they only supply reasonable internet in big city’s. those of us in the small towns do not have access to reasonable internet anyhow. I have to use internet via the cell-phone network (2G) as telkom is just too slow. try having internet via telkom when you have too use a mico-link too their telephone network. takes you hours to just clear your mailbox

  15. I got my ad in the mail yesterday and all it succeeded in doing was infuriate me.

    Their arrogance is incomprehensible.

    So because they have the fixed line market monopolised Telkom believes it can push its twaddle around willy-nilly? It borders on deception and false advertising, and I feel it owes the public the truth and an apology.

    There is no way I am going to buy a 5Gb from Telkom at R 70 / Gb. That’s daylight robbery, when for approx. a third you can get it from virtually all other ISP’s.

    Two words… “Epic Fail!”

  16. Clearly the idiots at telkom who wrote the article for their newsletter has no idea what the market wants and actualy needs. I moved from Do Krapband 3GB (which with the new model gave you 5GB) to AfriHosts 4mb uncapped and have never looked back…Even with the shaping I get far better response. Where with telkom I was capped by the 11th of every month, but if I got my true throughput I would probably be capped by the 5th.
    I cant believe that they think they actualy have better offerings…OMG!!

  17. Use to have a 3 gig with Telkom but always struggled with lines being down, caps somehow just being “reached” and together with the phone rental it was costing my business anything from a 1000 to 1500 per month for Telkom. Last year joined Neotel, and took thier 3 gig which is costing me R329 (i think) per month. I’ve never had to buy any extra gigs, unlike Telkom, the signal is fair and I’ve never had any downtime on the service. Also now working from the laptp, I can take my business anywhere. As for the landline, I gave that up and just added to my MTN prepaid. Total per month now about 700-800 rand. Half the price but much more than double the join.
    Nee wat Telkom, julle is 10 jaar agter en dan probeer julle nog steeds julle self regverdig met sukkel strooi.

  18. Telkom has always been playing with words, which they are good at, but unfortunately there are a lot of people out there that has got the common sense to read between the lines….

    Telkom needs to down their line rental.. They know they got the monopoly so they think that they can do what they want.

    Please, we need more operators so that the whole of RSA can benefit and become stronger as a country and not individuals.

    What telkom doesn’t say is that you cannot download 30 gigs of information for free, only the 1st gig is free and there after you have to pay through your neck.

    Good site to look at is hellkom, which gives you all the info about telkom and isps. They do the homework for you….

    We need to get rid of monopolies in this country and only then will we thrive as a country…..

  19. I am with MWEB ADSL 384K uncapped and yes it truely is uncapped, no smallprint no T’s & C’s that impact me, I average 2GB a day and am VERY happy with the service!!! This is typical Telkom BS!

  20. I will always be thankful to MWEB for starting the ball rolling with uncapped internet. There is a demand for it, or perhaps should I say a dire need for it. It is the only way the internet will grow – the very nature of online, interactive services demand it. A large cap (30GBish) or “uncapped” is the only way to have freedom of the internet. Trying to make a 3 – 5 GB cap last a month is a challenge and prevents you from enjoying whats out there and simply just being on line. Telkom is not listening to its customers and their needs (what else is new…). I could not believe they can write a newsletter like that. Who in heavens name could take that seriously? The Telkom CEO perhaps? It is the 21st century and we are in deepest darkest Africa. Then again it seems the rest of Africa will be overtaking us as they seem to realise the value of Internet access for all.

  21. Michael van Dijk on

    I have to reluctantly agree with Telkom’s assessment of MWEB’s “Uncapped” service – it is atrocious, after 60 GB – your connection is throttled so badly you can’t use email and browsing simultaneously.

    Had two “Uncapped” accounts with them and had to switch back to Telkom / WebAfrica, as the throughput was so poor. Once you contact them, it seems throttling becomes even more prevalent with marketing emails for the Business Uncapped service increasing.

    Not a good experience at all.

  22. Telkom must get its act together. When our gigs are up we are given extra local bandwidth which takes ages to go from one page to the other. That is their big ploy that we are given an extra 10 local gigs but what use is this as we can only go onto local sites and when there are blended sites we cannot get onto them. Most of the sites are blended. It takes ages to go from one site to another as we are capped. What is Telkom trying to do to us. If they want to stay in the market they must give us value for money which they are not doing. Most people have left Telkom for other service providers. People are not stupid and want value for money. Come on Telkom. They are not giving us value for money. They are throttling us when we are given local bandwidth. What good is this.

  23. @Michael You must be an outlying statistic, I couldn’t be happier with their service and bandwidth delivery, they certainly don’t impose soft-capping at certain levels like Afrihost. I have to have converted 50+ people over from capped accounts on various ISPs, and those awful IS-based uncapped accounts, and haven’t had 1 bad piece of feedback.

    Telkom’s just dead wrong on this, R65/gig is a massive profit margin for them, and they need that money desperately, so are resorting to this kind of tactics, preying on the general stupidity of users that don’t know any better, or those unfortunate enough to have been stung by bad uncapped like IS or Screamer.

    Even with the capped/uncapped argument aside, the fact you can get as good capped bandwidth for half of what Telkom charge invalidates their feeble argument about buying from them.

  24. Telkom should focus on wholesale only and give amazing service & price to the ISP’s. That way they could immeasurably help SA catch up to the 21st century and stop splitting the market. It would also clear a lot of the bull outta the market

    QED

  25. I am seriously considering dumping Telkom. My friend used about 149Gb in a month with Afrihost and had absolutely no problems. It worked out literally about a thouand times cheaper than if he had stayed with Telkom. If Telkom doesn’t put up Uncapped internet fast, they’re going down. I went to england for a month and loved being able to just go on the internet whenever I wanted and not worry about using up 3Gb lousy worth of cap. They are just trying to keep us all in their clutches because they can’t face the fact that for once they’re at the bottom of the ISP food chain of demand. Who wants to pay R86 less and end up using 97Gb less. Think about it. Even if you have problems on Mweb after 60Gb, how much more would it cost you if you had to actually buy that 57Gb at R64 each. They’re RIDICULOUS!!!

  26. The advert page that came with my Telkom bill is an insult to my intelligence! I have stuck it out with Telkom in the expectation that the fossils that manage the company needed time to come up with an uncapped offering. This advert appears to indicate that they have no intention of doing so, and I will be giving them the boot.
    Telkom is a millstone around the neck of the South African consumer, both private and business, and the sooner its management end up where they belong, (the unemployment queue), the better.

  27. Telkomsucks on

    telkom is seriously ripping us off i mean i use 2 gb the first week!! thanks to telkom!! i feel like sueing them because not once have i went through a month without hitting my cap! ahhhhhrg

  28. TELKOM IS ABSOLUTE CRAP!!!
    I just hit my cap, and it isn’t the 10th yet! Once my contract ends, I’m so giving them the boot. We are one of very few countries that pay such ridiculous rates..It is pure daylight robbery. Wake up telkom..this is not the dark ages anymore.

    And a special thanks to MWeb, so start things off.