Telkom customers brace for higher prices after two-year freeze

Telkom customers are set to be hit by price increases for all its fixed voice and broadband services after a two-year freeze brought about by the pandemic and the associated lockdowns.

The move could mark the beginning of a sector-wide price hiking cycle.

Through the lockdowns Telkom and a number of SA’s internet service providers reduced the cost to communicate. This came in the form of price freezes and even the lowering of some tariffs. Telkom’s fibre network operator Openserve doubled internet speeds for customers at no extra cost, in line with other operators.

Remgro-owned Vumatel, Openserve’s biggest competitor nationally, also upgraded its line speeds during the pandemic, while also not raising prices “until such time as the Disaster Management Act is halted”.

With many parts of the economy now open and inflation wreaking havoc globally, the partially state-owed operator said on Wednesday it will lift prices from August. 

“In an effort to maintain exceptional service offerings to our valued customers and small to medium enterprises, Telkom SA will implement increases across fixed-line voice and broadband tariffs, and certain mobile tariffs and services, effective August 1 2022.

“Given the pressures of the lockdown restrictions and slow economic recovery and growth, Telkom, like many other SA companies and businesses, has been affected by these unpredictable and unforeseen circumstances. These essential tariff changes have resulted in deflecting cost pressures alongside the price freeze and prevalent macroeconomic conditions,” said the company.

While higher prices are coming, in some cases, Telkom has adjusted internet speeds upwards.

On mobile, Telkom said certain tariffs will increase in monthly subscription costs, “however, these increases will not impact mobile customers subscribing to products within the Smart Broadband Data Portfolio and current FreeMe mobile voice offerings”.

Out of bundle rates for mobile voice and data services are also set to rise resulting in an increase on most tariffs. Voice rates for out of bundle consumption will increase from 70c to 75c per minute and data rates from 30c to 32c per megabyte.

Telkom Consumer Business CEO Lunga Siyo said: “As SA treads positively down the road to recovery and given Telkom’s commitment to its customers, we believe the increase is necessary to maintain our value-driven, high-quality product and service offerings to all our valued subscribers.”

gavazam@businesslive.co.za