Thursday, 16 July 2020

High Data Prices in South Africa means Great 4G coverage but Poor Subscription Rates


South Africa may well have one of the most advanced telecom infrastructures on the African continent. There is has been considerable investment from  municipal providers as well as from mobile network operators all aimed at improving network capabilities. The focus in recent years has been on backhaul capacity and on fibre and LTE networks to extend and improve internet service connectivity.

South Africa has 4 network operators: Vodacom, MTN, Cell C and Telkom (formely 8ta).The 900 MHz and 1800 MHz frequencies deliver 2G for all operators with 3G offered on 900 MHz and 2100 MHz except for Telkom using 850 MHz. 4G/LTE was launched in 2012 on 1800 (B3) MHz in major centres by Vodacom and MTN and more recently on 2300 MHz (TD-LTE, B40) and 1800 MHz (B3) on Telkom and 2100 MHz (B1) and 1800 MHz (B3) on Cell C.


So basically the telecom landscape is characterised by a duopoly where Vodacom and MTN command more than 70 per cent of the market share by connections. Market penetration of mobile connections stands at more than 165 per cent, smartphone penetration at 60 per cent of total connections and 4G population coverage at 95 per cent in 2020. However, 4G only accounts for 30 per cent of total mobile connections. The high data tariffs, which  result in consumers purchasing either short term or limited data bundles, have resulted in low 4G uptake. Also a large part of the South African population is digitally illiterate, having limited or no understanding of basic aspects of digital such as connectivity, devices and skills. Some industry sources estimate the number at 80 per cent. Lower digital literacy rates further discourages the uptake of LTE services.

Source: Cable.co.uk

Lack of adequate spectrum in the market is argued to be the contributor to high data tariffs. In the absence of adequate spectrum, operators have to invest more in existing bands to densify and increase the coverage.

The COVID-19 (coronavirus) pandemic (accompanied by lockdowns and remote working) resulted in surging in data traffic globally. For its part, South African operators like Vodacom experienced 40 per cent growth in data traffic, while MTN experienced 56 per cent growth from February to April.

To ease congestion and create capacity for new data traffic requirements, the South African telecoms regulator ICASA announced a temporary allocation of spectrum in various bands (700MHz, 800MHz, 2300MHz, 2.6GHz, and 3.5GHz) until November. Vodacom leveraged the opportunity to launch its 5G services on the 3.5GHz spectrum in several cities. MTN followed the move and launched on the last day of the quarter adopting a dynamic spectrum sharing model in various frequencies (700MHz, 2100MHz, 3.5GHz and 28GHz).

Due to the 4G experience in the market and the challenges of data costs and digital literacy it is expected that consumer 5G uptake will be slow and only account for only 8 per cent of the total mobile connections by 2025.



Vodacom is the biggest mobile provider in South Africa and is 50% owned by UK-based Vodafone. It’s the market leader with the most customers, a good coverage at the highest prices.

Vodacom launched Africa’s first standards-based, commercial 5G service in Lesotho in August 2018 using 3.5 GHz spectrum. They have also demonstrated the same network capabilities at an event in South Africa, using a temporary test spectrum license in the 3.5 GHz band. Apparently their network is 5G-ready and it will launch 5G services in South Africa as soon it gains access to the required spectrum.



MTN is the main rival of Vodacom. MTN launched 4G/LTE in 2014 and covers 90% of population in 2018. MTN is the only provider that roams in Swaziland, if you should travel there.

MTN has recently won the Open Signal Video Experience and Download Speed Experience awards  which the operator tied with Vodacom in August 2019  and has now tied Upload Speed Experience and Latency Experience — which MTN was losing to Vodacom six months ago. MTN has also retained the lead in 4G Availability. On the other hand, Vodacom won the two new metrics — Voice App Experience and 4G Coverage Experience.

MTN has also made significant improvements across the board, taking the lead in three of the seven award metrics. Vodacom also showed improvements, but the operator has conceded ground to MTN across all of the metrics that are present in both this report and our previous one, with the distance between the two operators changing in the favor of MTN. Telkom and Cell C are still lagging behind, but showed improvements across all of these metrics, save for Cell C in 4G Availability, which saw the operator’s score decreasing by 1.5 percentage points.


MTN South Africa has also trialled various cases of 5G in cooperation with Ericsson and Huawei, which the company said showed great promise for mobile and fixed solutions. During these trials, MTN demonstrated downlink speeds of up to 1.6 Gbps and uplink speeds of up to 520 Mbps. MTN South Africa has also successfully launched a live 5G indoor solution at Kyalami Grand Prix Circuit and International Convention Centre.The mobile operator has already rolled out 5G sites on existing spectrum where they don’t interfere with other deployed systems.

Cell C is the 3rd operator in South Africa. It claims to cover 98% of population, but still has gaps in certain areas. Cell C started a price war in 2011 by undercutting its rivals, but most operators now offer comparable price plans. Cell C is only cheaper when you use their confusing portfolio of bonuses.

Cell C used to roam on the Vodacom network outside areas of their own coverage for free, but this applied to 2G and 3G only, not to 4G/LTE. In 2018 Cell C announced it has entered into a far-reaching roaming agreement with MTN in order to complement Cell C's own mobile network. The agreement will see MTN providing both 3G and 4G services to Cell C in areas where Cell C has chosen to purchase coverage rather than self-build, mainly outside of the main metro areas.

4G/LTE was rolled out in Gauteng and Durban on 2100 MHz (B1) to be spread to 1800 MHz (B3) in other centers of the country. After the new roaming deal with MTN Cell C says its network service offering is at 99% 2G coverage, 96% 3G coverage and 80% 4G/LTE coverage of the population.

Finally Telkom is a South African-based telecommunication company and the fourth network in the country. It entered the market in 2010 and was called '8ta' before, but has been rebranded into Telkom. It offers the lowest rates for data in the country of any network operator while it coverage is less too.

While it has limited coverage, mainly in the cities, it currently roams on the 2G and 3G networks of MTN, but not on MTN's 4G/LTE. Telkom's 4G/LTE is on the rare TD-LTE 2300 MHz (B40).

In November 2018 Telkom signed a new roaming agreement with Vodacom. Telkom customers will be able to roam on Vodacom's 2G, 3G and 4G networks from 2019. Telkom has had a roaming agreement in place with MTN for 2G and 3G services and will conduct a phased transition from the current roaming agreement. This process will concluded in June 2019 when its contract with MTN expired. Telkom South Africa has announced that it plans to switch off its 2G network nationwide at the end of 2019.


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