Tanzania: Faster download speeds mean shift in charging from time-based to capacity-based


Internet cafes owners are facing technology challenges which may compel them to shift their billing method from time spent to bytes as broadband speed increased hundred folds. The theory is that document downloading speed has increased, thus a client at a cafe is able to download a lot of data at shorter time but use many bytes.

Charging in hours, internet cafe are losing revenue as in half an hour a client could download one-gigabyte that cost 30,000/- while paying merely token of 1,000/-. The only way is to slow down the broadband speed but "customers are complaining and we can't rise prices" due to stiff competition, Flora Njau of Ibukoni Internet Cafe, along Samora Avenue, says.

Njau says they normally buy four gigabytes at 200,000/- and sell at retail price of 2,000/- an hour but the bytes hardly last a month and in most cases fail to break-even. "It is a real tough business," Njau says. Wholesalers say that its high time that cafes to change their pricing methodology as per hour changing does not work under fiber cables.

"The speed has improved (hundred folds). The issue is not to stay longer at cafes but how much bytes on can download," Tanzania Telecommunication Company Limited (TTCL) Public Relations Manager, Amin Mbaga says.

Among the latest victim is Faith Internet Cafe of Mwenge Bus Stand that closed the shop recently. Its owner Ebenezer Msuya said he used to buy a Sasatel's bundle at 120,000/- which is about seven GB but at the end of the day collects only 85,000/-.

But cafe owners could not help it due to lack of software to check megabytes usage, says SimbaNET Corporate Sales Manager, Chintu Patel. Cafes strategy of one hour billing segments is only used because "it is the easiest way of billing.

For us (Internet Service Providers) it is easy as we have the technology,"  Patel says, adding: "The only way to survive is to find ISP that charged per hours and not per bytes as these suit corporate clients."

Sasatel's unlimited bundle is ideal for internet cafes which charges per hour but not the amount downloaded for the whole month. The package cost is 450,000/- for up to ten users per month. "Customers using Sasatel unlimited bundles don't have to worry about the download and upload limitations for the entire month," the firm website indicates.

The billing issue came after the coming of the marine cable that did not only low broadband prices by almost half, but also increases the quality of services amid speed. Without realizing the Internet has already changed the way one does business.

A person can get the information needed up to 40 times faster through marine cable than satellite. "Massive files download in seconds. Web pages appear almost instantly, Emails arrive in real time. That's the beauty of broadband," Patel says.