To FREE or not to FREE

Gone are the days when offering a free 10 Megabyte (MB) and 20MB Internet data at your venue (coffee shop, restaurant, guest house, B&B, Hotel etc.) gave you competitive advantage. Today, these amounts are significantly… insignificant. So what does this mean to businesses who offer Internet at their venues?!

Stats show a major increase in Internet use Globally and more importantly in South Africa. The penetration rate will reach about 20% by 2013 and by 2018 more than 33% of South Africans WILL have internet access. All this growth coupled with the revolution of social media and mobile technology points to an ever increasing use of internet data by both business and the consumer. Keeping up with bandwidth is therefore challenging and we are finding that 65% of our networks is being used for social networking, while use of video streaming services like YouTube have skyrocketed. Data usage patterns continue to evolve and based on relatively recent usage statistics, it is clear that bandwidth requirements will not diminish over time. Consider this:

  • There has been significant increases both in the number of social networkers and bloggers uploading videos, and also the number of active internet users watching audio-visual content
  • About 25% of 2 million active internet users in South Africa have uploaded video’s to a video sharing site
  • YouTube’s video’s average between 3 and 6min/video and a average size per video is 12MB.
  • 76% of social network users, upload photos

There is a general consensus in the Hospitality industry that foreign visitors to South Africa expect a completely FREE INTERNET service (not a free 10, 20MB). Unfortunately, in South Africa, this FREE Internet usually (not always) comes at the cost of speed and security. Studies continue to show us that price is only one of the important factors when customers judge an Internet service. According to surveys conducted in America and Europe, price generally ranks third or fourth behind ease of use, speed and security. Therefore, venues that focus only on FREE INTERNET at the expense of other qualities (especially speed), is at high risk of losing future business. So, the challenge for South African Hospitality businesses is to both have the ability to control expenses and to meet the expectations of the clients.

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10 Responses to “To FREE or not to FREE”

  1. I have to agree with you. The days of free Internet are no more; sure 20mb could let someone check their email, but even these days email uses plenty of data and for those who check email often, they no doubt get a lot of email, which results in a lot of data usage.

    In the hospitality industry, you’re right, when I go away, I expect their to be WiFi and I expect it to be free. I do understand that there are limits and all, but in general it’s a service which is definitely required, but does come at an expense. Perhaps the idea is to offer Xmb free and then RX/mb after that? It’s not too tricky to setup an unlimited account and then work it from there – I don’t think at least.

    Good article, nice interesting topic.

  2. Great blog and enjoyed the read and really got me thinking!
    Especially with the way internet and the way bandwidth is being utilized at such an increasing and growing rate.

    I must add that i think the leaders of the pack will be mobile SP’s. The reason i say this is with the increasing rate that people are accessing the internet ‘on-the-go’. Wireless hotspots are becoming more and more ‘outdated’ as you can unlock your smartphone and do just as much as you would with your notebook. It does not completely take away the fact that you need wireless connectivity, but i am seeing more and more people sitting in coffee shops,in lounges of hotels, on public transportation and just about everywhere accessing the internet on a mobile. Apple,Blackberry, Samsung, all these cellphone giants have picked this up and have made a meal of it. Connectivity has leaped forward in ways we cant imagine, i feel whoever can deliver it quickest and cheapest with quality to the palm of your hand, wins my vote.

    Great Blog Yazeed!

  3. Very interesting article.

    I encourage you to investigate the lack, or rather absence of an uncapped ADSL option for wireless ‘landline’ connections.

    I find it apalling that Telkom is moving towards wireless connections, yet this very connection isnt flexible enough to offer a complete telecommunication service.

    Well done with the blog, Im certain it will be a ‘hit’!

  4. Interesting article. I think you hit the nail on the head with “venues that focus only on FREE INTERNET at the expense of other qualities (especially speed), is at high risk of losing future business”.

    It reminds me of a restaurant I once walked into that had free wifi (with a WEP password mechanism and so no time or usage limit controls), but a sign saying something to the effect of “the internet is free, so don’t complain if its slow”. I really wouldn’t have minded paying an extra few bucks, either included in the price of my coffee & breakfast, or just for say a half hour voucher, since I was eating alone and had work to do online (as it turns out, it was too slow to use for my purposes).

    In any case, measurable quality of service is simply non negotiable if its a core part of an offering based on convenience.

    As an aside, regardless of model (free, not free, hybrid), when deploying a wifi network, especially with the 802.11n standard, an attempt to provide superior service levels is implicit due to the key advantages offered by the technology itself. The reality however is that the key is in HOW one deploys the technology, and thats where the magic sauce of the wifi hotspot provider comes in.

  5. I miis those days when leaving your house for the internet was such a wonderful thing

    • Hi,

      There are venues that offer up to 250MB Free and this is certainly a wonderful thing. That is one of the benefits that our venues have access to. The venue decides on the allocation of the voucher or automatic allocation. Places like Sinns Restaurant and Cafe Sofia are forerunners in providing their clients with sufficient amounts of bandwidth to connect, browse and share.

      I hope this will help you reconsider leaving your home.

      Thank you kindly for your comment.

  6. Your site is amazing, this is just what i was looking for!

    • Thank you kindly. :) If you ever find yourself at one of our venues please post on our Facebook, tweet us or comment on our blog and let us know which venue and your experience there. Many free vouchers to give away. Happy surfing!

  7. hey

    there are sites that give you free unlimited redbutton inernet for free i personally have to say even if i pay 20c per MB uploading photoes on Facebook or even whatching a video on you tube could take over 100mb’s whick is quit expensive although 100mb’s on a mobile divice like a phone will last over 2 weeks.

    I think re button should give 50ms’s to new customers and customers who spend over R150,00

    • Good Day Ken,

      Thank you for your input.

      Loving the idea of giving new customers some free data. As for those who spend to get free data? There are options available where free credit bonuses apply. If you log into your account manager (Purchase Credit option) you will notice percentages next the cost of the bundle. These percentages are your bonuses. So at the hotspot rate you mentioned, R 100.00 would get you an extra 40mb. There are numerous other options which are more attractive.

      What you also need to understand is:
      – You have the comfort of a wifi connection in your room (if in a accommodation venue)
      – You have no monthly contractual charges
      – No Telkom monthly charge
      – Many purchase options to suit your pocket
      – the site is maintained at no cost to you or your venue
      – You only pay for what you use

      I hope you find this answer to be suitable. If you have any other queries please comment.

      Thank you again.
      Happy surfing!

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