[kictanet] Tanzania first to lower internet rates? huh?

Mon Nov 2 16:49:18 EAT 2009

You are right ...

Sorry, missed a 0,-

Kai
  ----- Original Message ----- 
  From: nicholasnesbitt 
  To: kai wulff 
  Cc: 'KICTAnet ICT Policy Discussions' 
  Sent: Monday, November 02, 2009 4:29 PM
  Subject: Re: [kictanet] Tanzania first to lower internet rates? huh?

  Kai
  Quick question... In this example, if you can get 638GB on a 1Mbps pipe for USD$600, then should 10GB not cost you a little under USD $10 rather than "less than USD $1.."..?  

  To address the general questions asked by the press and all and sundry, I think the challenge in understanding pricing frequently arises because the press and public don't quite understand the following basics:

  1. 8 bits = 1 Byte; one cannot use the terms bit and Byte interchangeably 
  2. Mbps is the common term used in reference to speed or throughput (megabits per sec), not MBps (mega Bytes per second); 1Mbps = 0.125 MBps or a 125K file will download in 1 second.
  3. MB is a unit of storage/size...  and 1 GB = 1,000 MB

  And with regard to the TZ example, the prices in TZ are $2,415 for a pipe that allows you to download 1 Mb of data per second,  (not 1MBps, as the author in this email insinuated).  In Kenya that same 1 Mbps pipe costs $600 from KDN.  So the headline that TZ was the "first to reduce its prices" was not accurate.

  In addition, downloading 1 GB of content in TZ costs $200, whereas in Kenya it is less than $10!  Big difference, as Kai points out!  

  Interestingly, at these Kenya wholesale prices, to download 1MB of data in Kenya would cost $ USD 0.0009 or 7 Kenya cents... therefore, if we pay 1 KES for 1MB of downloaded data, as recently advertised in the papers, there is a lot of margin for the providers...93%

  So, I hope it's also clear that companies typically charge a standing amount for a certain "size/speed" of pipe (256Kbps, 512Kbps, 1 Mbps, etc) and "may" charge an additional fee for the amount of actual data/throughput (GB) that you downloaded on the pipe.  You can download content on any size pipe, it just takes longer on the slower speed pipes..

  It would really get interesting in Kenya if we were to pay a certain amount for the speed of the pipe, but the amount of data that we download is not metered, i.e. download as much as you like off the internet for free...  unlimited access as it is in many parts of the developed world..  Download video, browse the internet, make phone calls, play games all for free (unless your paying an online service provider to buy a video or play a game,etc), but the monthly pricing to the ISP is based on the speed of the pipe and not on what you download on the pipe...  Now that will be progress...

  Nik

  On Oct 31, 2009, at 11:01 AM, kai wulff wrote:

    And I get complaints about the charges in Kenya …

    There is another confusion ..

    Some people confuse packages (like 1GBYTE) with throughput like 1Mbps …

    If you have 1Mbps duplex you can receive:

    1 Megabyte in 8 seconds

    7.5 Megabyte in a minute

    450 Megabyte in an hour

    10800 Megabyte in a day

    326700 Megabyte (319 Gigabyte) in a month (30.25 days)

    Since you can send the same amount you could have a volume of 638 Gigabyte with a 1Mbps pipe …

    So if you take 1Mbps at 600 USD you will arrive for a package of 10Gigabyte at less than 1 USD …..

    Von: kictanet-bounces+kai.wulff=kdn.co.ke at lists.kictanet.or.ke [mailto:kictanet-bounces+kai.wulff=kdn.co.ke at lists.kictanet.or.ke] Im Auftrag von Brian Munyao Longwe
    Gesendet: Saturday, October 31, 2009 10:47
    An: kai.wulff at kdn.co.ke
    Cc: KICTAnet ICT Policy Discussions
    Betreff: [kictanet] Tanzania first to lower internet rates? huh?

    TTCL drops pricing to 1MB for $2415/month? and that is low? Read on.....

    First East African country to lower internet rates? hmmmm.....
    Tanzania First to Lower Internet Rates
    Tanzania Telecommunication Company Ltd customers will from this month enjoy a 50 per cent cut in Internet charges, making Tanzania the first East African country to lower Internet charges. TTCL chief executive officer Said Amour Said, told The EastAfrican that the lowering of charges follows the firm's connecting to the Seacom submarine fibre optic cable.

    "TTCL has reduced its Internet prices effective from October 1, in order to pass on this cost saving benefit to the end users, and the high customer expectations of reduced costs on Internet services have finally been met," he said.

    The new prices will see high volume Internet users including banks, large businesses and corporations, government agencies and other institutions enjoying a substantial Internet bandwidth cost reduction as customers will get the same capacity of bandwidth at a third the current prices.

    Under the new structure, a client who buys 1Mbps of Internet capacity for Tsh9.2 million ($7,000) will now buy the same capacity for just Tsh3.14 million ($2,415).

    For small and medium businesses like cyber cafes, the price has been slashed by 50 per cent.

    According to Mr Said, customers who were buying 5GB for $200 (Tsh200,000) will now buy 10GB for the same amount of money, and that all Internet subscribers in this category would continue to get high speed of up to 4Mbps through their TTCL fixed lines.

    According to the new tariff, non-commercial ordinary clients will enjoy a new package with unlimited use for a monthly price of Tsh45,000 ($ 43) with a speed of up to 256Kbps.

    "It is an ideal service mostly for the common man because it is affordable and guarantees continuous usage," explained Said.

    (Source: The East African)

    -- 
    Brian Munyao Longwe
    e-mail: blongwe at gmail.com
    cell:  + 254 722 518 744
    blog : http://zinjlog.blogspot.com
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