Why is mobile data so expensive?

+6 votes
By expensive I mean compared to ADSL data prices
asked Mar 13, 2017 in General by Life4cash (250 points)

4 Answers

0 votes
to keep us in the dark, surely? (Zuma had brought this issue up in SONA this year)
answered Mar 13, 2017 by naaibus (870 points)
+1 vote

The quick and dirty answer, unfortunately has a political twist to it.
Government controls frequency spectrum (signal ranges) within the country, they have not migrated many analogue broadcasting systems to digital sucessfully, which leads to a very crowded space for high demand spectrum in South Africa
The more spectrum is available, the more players there will ultimately be, driving down prices to the end user as a result of competitive policies instead of monotisation policies.
Think Telkom, Neotel etc - not many providers are available in fixed line either - and as a result we have issues like this.

answered Mar 13, 2017 by XBearerZA (700 points)
0 votes

According to Rupert Baines, V P Marketing in startup: chips for 3G, 4G. MVNO and consulted for MNOs on Quora.com: 

  • Copper (element) is a better conductor than air. It it is easy to get lots of Mbps on a phone line or coax line; it is hard to do that over air.
  • As a result of that, the chips (headend & client) are cheaper.
  • Phone lines & coax are point-point, that means that total amount of capacity is vastly greater to share out. Wireless bandwidth is a scarce resource, a few Mbps are shared between everyone in a cell
  • Infrastructure invested over decades; infrastructure invested now that needs to be paid for now. Those phone lines cost a lot to lay, but spread over a long time & now fully depreciated they are "free". Building a basestation or WiFi node costs money now - and it will be obsolete in 5 years so you need to recover that capital expenditure quicker.
  • Phone & cable modem headend (where the wires go) exist, and they are in "the right place". Fibre goes to phone exchangers, central office & cable TV nodes (because that is how the phone calls & TV work). Again, already paid for. Basestations need new infrastructure, new connectivity.
  • The above describes DSL or Cable-Modem. Fibre is new investment, it is expensive, and it happens slowly. Many parts of the country, and the vast majority of the world, do not have fibre and will not have it for decades, precisely because the economics are hard.
  • Cellular can go further (higher power) but needs to buy spectrum & basestations are expensive. WiFi has cheaper basestations, no spectrum cost, but power is restricted so only short range. The balance between these two is complex, and it is "a bit of both" is best.

These are not "either/or"

In some places fibre happens & is cheap.

For much of developed world, fibre is happening slowly, and DSL/cable is cheapest.

For some people, wireless is cheaper. "cutting the cord", "LTE for broadband", "mobile only" are not amjority but they are perfectly viable broadband techniques.

In the developing world, with less copper, then "leapfrog" to mobile only is the norm. "



Personally, I have like ZERO Clue.


answered Mar 13, 2017 by babyacid (430 points)
0 votes
due to numerous financial gains by many organizations.

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answered Mar 13, 2017 by Cassimvahed (1,210 points)