Seacom high-speed internet goes live

THE much-anticipated undersea fibre optic cable linking Africa to Europe will not make Internet access much cheaper for South African consumers after all.

Seacom was switched on yesterday, promising that the cable will make fast Internet cheaper, but analysts cautioned that only corporates were likely to see a drastic drop in their Internet bill, while consumers would continue to pay high tariffs for voice and data services.

An executive of a leading Internet service provider who would not be named said: "There will be no impact on the consumer. International broadband is a small component of data consumed by consumers unless you are a huge corporation constantly moving data to Europe."

Frost & Sullivan ICT analyst Lindsey McDonald said there would be changes, albeit gradual.

"The changes will be gradual. We'll most likely see better packages, higher speeds and more value in general as suppliers feel the need to compete.

"Already yesterday, we saw Wireless G (an Internet service provider) bringing prices down by 25percent."

McDonald said while data was costing about R2 per megabyte (MB), we could start seeing a gradual improvement to R2 for 2 MB.

"You need to remember wholesale broadband (which is what Seacom offers) is only a fraction of the operators' running costs, so we won't see massive price drops immediately," she said.

The launch of the Seacom cable does, however, mean that there is some competition in a market which has been monopolised for years.

South Africa has had some of the highest Internet and calling tariffs in the world and when Seacom began its rollout, it promised it would assist in bringing wholesale data prices down by 90 percent.

This translated to a drop of between R3500 and R11000 per megabyte per second per month currently to as low as R267 per Mbps per month for operators.

Seacom chief executive Brian Herlihy said yesterday: "Our tireless efforts for the past 24 months have come to fruition. Turning the switch on creates a huge anticipation but ultimately, Seacom will be judged on the changes that take place on the continent over the coming years."

The 17000km Seacom cable, which lands lands in Mtunzini, 120km northwest of Durban, allows information to be sent at speeds of 1.28 terabytes per second, fast enough to stream high-definition video.