Fixed-line operators would have to invest in new high-speed tech- nologies to maintain their share of the broadband market as faster and cheaper mobile broadband overtakes fixed broadband.

This is according to a report by Research ICT Africa, which states that mobile broadband is the most popular, widely accessed form of broadband by the 20% of South African households that have Internet access.

The majority of households access the Internet through a mobile phone and through a third-generation (3G) mobile modem, while only 22% of households with Internet connectivity have an asymetric digital subscriber line (ADSL), owing to its slower speeds, more expensive basket prices and lower penetration.

“As elsewhere in Africa, mobile broadband has overtaken fixed broadband in South Africa in terms of subscribers, price and speed of service,” the report states.

While the pricing ease of setup and prepaid charging options of mobile connectivity are more appealing than fixed-line Internet access, many corporate groups, critical public-sector services and other users prefer fixed-line networks owing to their more reliable and stable connectivity.

But fixed-line broadband operators will continue losing customers while being outpaced by the mobile speed offerings of the much faster 3G, long- term evolution and fourth-generation networks unless the operators move to invest in high-speed and reliable tech- nologies such as very-high-bit-rate digital subscriber line, or VDSL, and fibre-to-the-home.

“Poor broadband penetration levels in the country are an outcome of high prices. The high prices and poor quality of ADSL services reflect the absence of competition in this segment of the broadband market, in contrast to the more competitive mobile segment of the broadband market,” Research ICT Africa points out.

Although mobile broadband pricing is lower than mobile voice in South Africa, which is deemed to be among the most uncompetitive worldwide, there remain fee disparities between postpaid and prepaid, and fixed line prices are nearly double the price of mobile broadband.

On average, it costs about R112.40 a month for a 1 GB package on prepaid mobile broadband, while postpaid for the same package falls to R59.50.

For a 5 GB mobile broadband deal in South Africa, you will pay R218.20 on a contract and R237.40 on prepaid.

ADSL costs about R425.30 a month for 5GB – higher than many African countries that do not have the economies of scale South Africa does in fixed-line infrastructure.

Uncapped on fixed line could reach R405.30, compared with mobile broadband’s uncapped offering of about R328.20.

The cost drivers underlying South Africa’s high fixed-broadband prices need to be identified and undergo a regulatory impact assessment on the cost of com- munications.

Research ICT Africa states that policy and regulation changes will enable the nation to combat cracks in fixed-line and mobile broadband.

“To achieve an enabling policy and regulatory framework conducive to investment, the rationalisation of existing infrastructure and the coordi- nation of infrastructure planning going forward are a key challenge for countries such as South Africa wishing to develop their societies and economies and become globally competitive,” the report says.