Has the price of Internet access dropped in Cameroon?

[Alex Drahon]

We had some kind of a discussion about Internet access price yesterday
on Twitter. This discussion is partly tied to the issue of Internet
penetration. My personal opinion is that this idea that "Internet
access price has dropped drastically since one year in Cameroon" is a
marketing campaign by Ringo (no offense to them, they're doing a great
job) and not a fact. Considering:
- hourly rate in cybercafes is the reference price for the vast
majority of Internet users in Cameroon;
- this hourly rate in cybercafes hasn't dropped and Ringo's hourly
rate is roughly equivalent, this is the real market price for Internet
access;
- the monthly rate for unlimited access of 25000 CFA Francs hasn't
change since 2 years when MTN took the offensive (closely followed,
for instance, by Matrix at 24000 F);
- what has changed with Ringo is the entry price, you don't have to
pay 100K to 250K for radio equipment installation, this is very
important;
- the prepaid cards system is also a major innovation by Ringo;

I argue that Internet penetration has undoubtedly progressed, but not
by lowering Internet access cost, only upfront cost has been reduced.
Of course you still have to buy a computer, a major limiting factor.

Alex

[Jeremy Brown]

2009/11/13 Alex Drahon <adr...@gmail.com>

We had some kind of a discussion about Internet access price yesterday
on Twitter. This discussion is partly tied to the issue of Internet
penetration. My personal opinion is that this idea that "Internet
access price has dropped drastically since one year in Cameroon" is a
marketing campaign by Ringo (no offense to them, they're doing a great
job) and not a fact. Considering:
 - hourly rate in cybercafes is the reference price for the vast
majority of Internet users in Cameroon; 

Agree we can use this as a marker, here in Limbe I observe that the hourly rate is around 250 - 300 CFA for most cybercafes. Though the 250 rate is usually 500 CFA for 2 hours.
 

 - this hourly rate in cybercafes hasn't dropped and Ringo's hourly
rate is roughly equivalent, this is the real market price for Internet
access;

What is interesting is that Ringo's pay as you go connection is 300 CFA an hour - for your own modem with a 256k connection - if you have your own computer and Ringo modem.

Though maybe Internet cafe's haven't had time to switch to using Ringo - maybe only a few are using them as they have already invested in Camtel. And of course with the drop in monthly costs for Camtel from 35,000 to 25,000 they are making the most of their cheaper bandwidth to make more money.

I would predict that once more cybers start using Ringo's 256k connection (more bandwidth for same price) they will be able to either drop their price or serve more computers on their network.

 - the monthly rate for unlimited access of 25000 CFA Francs hasn't
change since 2 years when MTN took the offensive (closely followed,
for instance, by Matrix at 24000 F);

I would say that Ringo has still reduced the cost of Internet - despite the fact that the entry level unlimited access is 25,000 CFA you do get a  256k connection whereas Camtel only give you 128k for their ADSL connection.

 - what has changed with Ringo is the entry price, you don't have to
pay 100K to 250K for radio equipment installation, this is very
important;

Agree, this is an important innovation - with Camtel you need to get a phone line (time and money, if a line is available) and buy a much more expensive ADSL router.

I guess Ringo are subsidising the cost of their modem, but this makes sound business sense as they can rapidly grow their customer base.

In addition as we saw with the sale of the bindi modems at 10,000 CFA they sold approximately 8,000 units in a couple weeks with a great promotion. There is demand for internet with a low barrier to entry. I'm sure when they get more stock they will see their subscriber base grow even faster.

 

 - the prepaid cards system is also a major innovation by Ringo;

Agree this makes them much more attractive in a world where everyone is used to buying credit for their mobiles.

I argue that Internet penetration has undoubtedly progressed, but not
by lowering Internet access cost, only upfront cost has been reduced.
Of course you still have to buy a computer, a major limiting factor.

Alex

 

I think your argument is correct, though I would say that the connection speed has gone up for your 25,000 CFA flat rate, from around 128k to 256k if you are using Ringo.

The wider market has responded but lets see what happens once Ringo negotiates their next tranche of bandwidth with Camtel - they seem to have been able to negotiate the best rates for bandwidth of any of the operators.

I think it would be good for us to collect information into a database on the various ISPs, the costs for entry and their pay per minute and monthly unlimited costs, as well as the various bandwidth options.

Then we can update this as the market changes.

Does anyone have any historical data?

We could put this all into a shared google spreadsheet on the group or something like that... what do you guys think?

Collecting the data gives us options to analyse and hopefully also push Camtel to make bandwidth cheaper.

One thing I would love to see is ISPs selling small netbooks like the Eepc for around 200,000 CFA - long battery life etc. Right now netbooks are exhorbitant here compared to what it costs in the US or Europe due to crazy import duties. However if an ISP was able to negotiate a reduction in the duties or using their buying power to buy in bulk it would mean greater access for all. A new netbook, even at 250,000 CFA bundled with a bindi modem would sell like hotcakes here.

Best Regards,

Jeremy

[jean-francis Ahanda]

Hi,

I'm going to make a couple of contribution with some of the
infrastructure that we need to push our ISPs to have in Cameroon.

For those who don't know it , i would to introduce you to The NTP pool
project ( http://www.pool.ntp.org/fr/ )

The pool.ntp.org project is a big virtual cluster of timeservers
providing reliable easy to use NTP service for millions of clients.

The pool is being used by millions or tens of millions of systems around
the world. It's the default "time server" for most of the major Linux
distributions and many networked appliances (see information for vendors).

Today there is only 11 servers active in Africa !

Jean-Francis