All the big fibre price hikes of 2024

South Africa’s four big open-access fibre network operators (FNOs) adjusted many of their fibre-to-the-home (FTTH) line speeds and prices in the past few months.

Because they are the customer-facing part of the FTTH supply chain, Internet service providers (ISPs) often get a tough time for price hikes.

However, when it comes to fibre price adjustments, there are generally two changes consumers should be aware of.

Firstly, the ISP could change its pricing. Some ISPs do this annually, but others keep their prices unchanged unless FNOs adjust theirs.

Secondly, there are FNO-driven package and price adjustments that come from the infrastructure owners themselves.

In these instances, an FNO can change its wholesale package structure with adjustments in line speeds, including making forced upgrades and grandfathering certain products.

These changes can also include price hikes and reductions.

Some larger ISPs can afford to absorb FNO-driven price increases to a point.

In these instances, end-users will be insulated from the price hike.

However, many ISPs operating on small profit margins must adjust their prices to avoid running at a loss.

In the past few years, several major FNOs have increased their minimum line speeds, making their entry-level products more expensive.

The Internet Service Providers Association of South Africa (ISPA) has previously pleaded that these upgrades should not be compulsory.

“In today’s challenging economic climate, not all consumers want (or need) a faster service,” ISPA said.

“Some consumers would prefer to experience the same speed service they previously enjoyed and to simply pay less for it.”

However, some FNOs have explained that they have no choice but to increase prices. This leaves them with a choice — charge more, or charge more and give consumers something in return for the higher price.

The latest FNO price adjustments are summarised below.

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MetroFibre — November 2023

The third-biggest open access FNO by homes passed — MetroFibre — was the first to make changes to its packages with a major overhaul from November 2023.

The FNO divided its network into two classifications — Nexus and Nova — with five and nine packages, respectively.

If you are in a Nexus area, you cannot get 20Mbps, 40Mbps, 60Mbps, or 400Mbps line speeds.

Those on the Nova network get access to the full suite of MetroFibre line speeds.

The latest package speeds for each network type are summarised in the table below.

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Frogfoot — January and February 2024

Frogfoot followed with its wholesale price adjustments in early 2024, upgrading line speeds on all but its top-end package, alongside price hikes on the amended packages.

An industry source said that the price increases on some of the products were “substantial”, with one jumping by R200, excluding VAT.

Even after the changes, however, we found that Frogfoot’s FTTH prices offered among the best value for money when measured on a price-per-Mbps of download speed.

Frogfoot’s line speed changes are shown in the table below.

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Openserve — April 2024

Telkom Group’s wholesale and networks division, Openserve, implemented price hikes on its FTTH packages from April 2024.

The FNO said the new wholesale pricing was aligned with the increased speeds it implemented on 1 April 2023.

However, when it introduced last year’s speed increases, it never revealed whether the upgrades were free and refused to confirm this to MyBroadband.

“The Openserve wholesale prices are confidential and only shared directly with the ISP partners,” the FNO told MyBroadband at the time.

Therefore, the FNO could have previously increased the prices before this year’s adjustments.

While it would again not reveal its wholesale price changes this year either, an industry source stated they were as follows:

• 50Mbps packages — increased by R50, excluding VAT
• 100Mbps, 200Mbps, and 300Mbps packages — increased by R40, excluding VAT
• 200Mbps and 300Mbps packages — increased by R30, excluding VAT

Based on the fact that many ISPs sold Openserve’s entry-level packages for between R500 and R600 before the price changes, the R50 hike, excluding VAT, was well above inflation.

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Vumatel — May 2024

The last major operator to implement price hikes was Vumatel.

MyBroadband learned of its wholesale price changes when ISPs started notifying customers last week.

Customers using three major ISPs — Afrihost, Cool Ideas, and Vox — will be paying between R20 and R100 more on their packages from next month.

Cool Ideas customers on the 1Gbps package with 250Mbps upload speeds are the only ones who will be paying less for their product.

However, given that Afrihost kept its price for this package the same and Vox increased its price by R80, this might have been an ISP-driven decision by Cool Ideas to better compete with this product, rather than a Vumatel wholesale price cut.