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Data must be attacked, but by precision strike

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The campaign to target the cost of data runs the risk of missing the point, that data prices have in fact plunged – but not for the poor. By ARTHUR GOLDSTUCK.

When a hashtag campaign tells us that #DataMustFall, it’s easy to be caught up in the outrage at high data costs and the enthusiasm for cheap data. Aside from the operators who profit when prices remain high, no one would argue against it.

But there is one flaw in the campaign: it does not make it clear which data prices must be targeted, and why.

That’s important, because it is easy for the operators to argue that data has indeed fallen. The average price of data bundles has been cut by anywhere from 20 per cent to 50 per cent, depending on which bundles from which operators one buys. As a result, the operators can complain that they are not given credit for bringing down the cost of data.

That’s a devilishly disingenuous argument, though. Data has fallen only for the wealthy and the well-off, who can afford to buy large bundles upfront. For example, someone buying a 20GB monthly bundle from Cell C or MTN will pay only R499 a month, or 2.5c per Megabyte of data. That’s among the cheapest in the world. However, to afford that kind of bundle, you need to be earning a fairly decent salary.

For a 500MB bundle, the cost is as low as R39 a month on MTN, Cell C and Telkom Mobile. That works out at 8c per Megabyte. That’s not too shabby, either.

What is shabby is that these bundles are described as affordable, based on the per Megabyte cost.

The problem is that the bundles are not being sold per Megabyte. The problem is that entry-level smartphone owners are buying data only when they use it. The problem is that pay-as-you-go data comes off airtime. And the problem is that airtime data is the most expensive data one can buy.

It works like this: pay-as-you-go data, also described as ad hoc data because it is bought only when used, is billed at the ceiling price of data. On Vodacom, that is R2 per Megabyte. On MTN it is R1, and on Cell C it’s 99c.

Why would people endure such high costs when they could be paying as little as 8c per Megabyte? There are two answers.

The first is that at least a quarter of smartphone users are not incurring those costs. They know from hearsay that the moment they activate the Internet or data access on their phones, it starts chewing into their airtime. While there are valid explanations for this phenomenon – mainly apps updating in background or apps polling servers for status updates – it is perceived as data or airtime being stolen. It is estimated that a full 25 per cent of smartphone users do not access the Internet for these and related reasons.

The second answer is one that is a matter of pure economics. Those on the lowest income levels or earning no income will still go to great lengths to buy a prepaid voice package, as communication has become a basic human need. The fact that bundles start as low as R5 for a specified number of minutes provides the clue to just how little some voice customers can afford.

Data is not perceived as an essential purchase by most people in these segments, and is almost never bought in bundles. Even bundles as small as R25, which would achieve major savings in the cost of ad hoc data, are regarded as unaffordable.

As a result, for those who cannot afford data bundles, ad hoc usage on apps like WhatsApp, Facebook and email is almost always at the ceiling price. This means it is the ceiling price of data that must fall.

The networks call these out-of-bundle rates, but that in itself is a misnomer. It implies that it is a penalty for not buying bundles, and that further implies it is the consumer’s own fault. In other words, people are being punished for being poor.

It is ironic that it is only the once-vilified Telkom that seems to have understood this message. With any airtime recharge of R5 or up on its SIM-Sonke prepaid deals, the ceiling price of data is 29c per Megabyte. That, rather than a R5 data bundle, is what one might call affordable, despite the fact that it still limits how much usage can be made of data if most of one’s bundle is needed for voice.

Since 2011, when the smartphone revolution began in earnest in South Africa, World Wide Worx has been calling for the regulator, Icasa, to put a mandatory and affordable ceiling on the price of data. That could range from 20c to 40c, but Telkom has set a good precedent at 29c per Megabyte.

This is an obvious solution, yet it appears that the authorities would rather milk the situation for as long as it can. The Minister of Communications has mandated Icasa to investigate whether high data prices are a result of lack of competition. In other words, let’s build more time and cost into the equation, rather than acknowledge what has been obvious all along.

Some have called for data prices to be halved, but that still leaves the ad hoc user paying exorbitant rates ranging from 50c to R1 per Megabyte.

Yes, data must fall. But, rather than the carpet-bombing approach taken by a one-dimensional campaign, we need a precision strike that takes out the real enemy, namely the punitive ceiling price of mobile data.

  • Arthur Goldstuck is founder of World Wide Worx and editor-in-chief of Gadget.co.za. Follow him on Twitter and Instagram on @art2gee

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Samsung unfolds the future

At the #Unpacked launch, Samsung delivered the world’s first foldable phone from a major brand. ARTHUR GOLDSTUCK tried it out.

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Everything that could be known about the new Samsung Galaxy S10 range, launched on Wednesday in San Francisco, seems to have been known before the event.

Most predictions were spot-on, including those in Gadget (see our preview here), thanks to a series of leaks so large, they competed with the hole an iceberg made in the Titanic.

The big surprise was that there was a big surprise. While it was widely expected that Samsung would announce a foldable phone, few predicted what would emerge from that announcement. About the only thing that was guessed right was the name: Galaxy Fold.

The real surprise was the versatility of the foldable phone, and the fact that units were available at the launch. During the Johannesburg event, at which the San Francisco launch was streamed live, small groups of media took turns to enter a private Fold viewing area where photos were banned, personal phones had to be handed in, and the Fold could be tried out under close supervision.

The first impression is of a compact smartphone with a relatively small screen on the front – it measures 4.6-inches – and a second layer of phone at the back. With a click of a button, the phone folds out to reveal a 7.3-inch inside screen – the equivalent of a mini tablet.

The fold itself is based on a sophisticated hinge design that probably took more engineering than the foldable display. The result is a large screen with no visible seam.

The device introduces the concept of “app continuity”, which means an app can be opened on the front and, in mid-use, if the handset is folded open, continue on the inside from where the user left off on the front. The difference is that the app will the have far more space for viewing or other activity.

Click here to read about the app experience on the inside of the Fold.

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Password managers don’t protect you from hackers

Using a password manager to protect yourself online? Research reveals serious weaknesses…

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Top password manager products have fundamental flaws that expose the data they are designed to protect, rendering them no more secure than saving passwords in a text file, according to a new study by researchers at Independent Security Evaluators (ISE).

“100 percent of the products that ISE analyzed failed to provide the security to safeguard a user’s passwords as advertised,” says ISE CEO Stephen Bono. “Although password managers provide some utility for storing login/passwords and limit password reuse, these applications are a vulnerable target for the mass collection of this data through malicious hacking campaigns.”

In the new report titled “Under the Hood of Secrets Management,” ISE researchers revealed serious weaknesses with top password managers: 1Password, Dashlane, KeePass and LastPass.  ISE examined the underlying functionality of these products on Windows 10 to understand how users’ secrets are stored even when the password manager is locked. More than 60 million individuals 93,000 businesses worldwide rely on password managers. Click here for a copy of the report.

Password managers are marketed as a solution to eliminate the security risks of storing passwords or secrets for applications and browsers in plain text documents. Having previously examined these and other password managers, ISE researchers expected an improved level of security standards preventing malicious credential extraction. Instead ISE found just the opposite. 

Click here to read the findings from the report.

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