Internet. (Duncan Alfreds, Fin24)
Cape Town - A broadband provider says that lower cost internet access doesn't mean that congestion on the network will make the service experience unacceptable.
"We are constantly monitoring the usage of our networks. Congestion might eventually happen, but it is rather unlikely. This is why we are partnering with Workonline Communications - to help us provide the necessary bandwidth at any moment," Kalin Bogatzevski, CEO of 123Net told Fin24.
The company has disrupted the local internet market with an offer of unlimited broadband for just R3 600 as a once-off payment or in equal 12 monthly instalments.
Some had suggested that the service was not sustainable given that it is significantly cheaper than rival offers.
But Bogatzevski doubled down on the offer which is already live in Herrwood Park, La Lucia, Prestondale, Somerset Park, Sunningdale, Umhlanga Umhlanga Ridge, Umhlanga Rocks and Woodlands in the KwaZulu-Natal province.
READ: 'Free' broadband fibre rolls out for SA
"The Free Internet service is our market strategy to provide basic broadband speeds for the current moment in South Africa (5 down, 1 up). The once-off payment of R3 600 covers the construction fee for the network and fibre building from our backbone on the street to the customer's premises," Bogatzevski said.
South Africans have long battled with poor but expensive internet infrastructure despite the arrival of a number of submarine fibre cables.
The government's South Africa Connect: Creating Opportunities, Ensuring Inclusion South Africa's Broadband Policy specifically criticises broadband in SA.
"The slow deployment of fixed broadband services (ADSL), and its relatively high costs, meant that over the last five years mobile broadband rapidly became the primary form of broadband access; rather than providing a complementary service to fixed broadband as it has done in mature economies."
Unlimited broadband is ideal to consume video or TV streaming services. (Duncan Alfreds, Fin24)
But the thinking that fibre broadband is an expensive luxury item may be short-sighted.
"It is important to note that there is, in fact, an oversupply of international bandwidth available in South Africa, and that the national grid is now well developed in terms of inter-city connectivity between the major metropolitan areas such as Johannesburg, Cape Town and Durban," Edward Lawrence, director of Business Development at Workonline Communications told Fin24.
As a wholesaler, the company says that it is able to offer service to end-user providers at lower cost without the need for traditional strategies such as caps or shaping.
"This plays an important role in allowing wholesale network service providers, such as Workonline Communications to offer a 1:1 contention ratio to our clients and partners, such as 123Net, allowing them to guarantee a higher quality service regardless of the time of the day," said Lawrence.
As more people migrate online, the demand for data is set to accelerate and 123Net is intent of placing itself at the centre of the demand for broadband service in SA.
The company's uncapped service will be rolled out as people register for the service in local areas, and the firm is the lead bidder for the Constantia Fibre project, competing against major players such as Vodacom, MTN and Telkom.
"The demand for speed is a worldwide phenomenon. Five megabits per second is not enough if the customer needs more than just simple browsing, email, or SD TV (YouTube etc). Once the customer requires a higher quality broadband speed, he can upgrade seamlessly to one of our paid plans (Gigabit 10 & Gigabit 100 at the moment)," said Bogatzevski.
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