South Africa needs to blast open its telecoms industry

I’m working in our Cape Town, South Africa office this week.  Today we met one of the major telecoms suppliers to sort out our connectivity in the new building that we’re taking.  I remain blown away by the price of Internet connectivity in South Africa.  List price for a 1Mb is $3,000 per month!  These prices then trickle down into home broadband bundle coming in at $62 per month in a country where the average GDP per capita (in PPP terms) is $10,100 per year according to the CIA Handbook.  As a result, very few people have broadband access in their homes leaving them disconnected from the rest of the world.

I can’t understand why the South African government doesn’t completely de-regulate the market and open out the telecoms industry.  One sure fire way to kick the economy into gear is to create an environment where universal access to broadband becomes the norm.  Be in no doubt, low cost broadband and the resultant increased penetration almost certainly contributes positively to GDP growth.