Internet service provider MWeb has become a direct rival to Telkom by encouraging clients to make cut-price international phone calls over the internet. This is a retail challenge to Telkom from a major player with a large customer base. MWeb is aiming at consumers and people who work from home, and promises calls to 38 countries at 60c (US9 cents) a minute. That slashes almost two-thirds off the cost of using a Telkom line to make those calls at R1.70 (US25 cents) a minute.

CEO Rudi Jansen said MWeb's international fee was only a little dearer than the 54c a minute that Telkom charges for a local call. It has also undercut Telkom's call rates to cellphones in SA in peak hours, and matches its fees for calls to other Telkom numbers. The move is possible as a partial relaxation of the laws lets data carriers offer voice calls over the internet. Until now, most suppliers have concentrated on corporate clients and have not aimed at consumers, Jansen said.

Its service, Broadband Talk, is available to customers using MWeb's high-speed ADSL internet service, which applies to 45000 of its 350000 subscribers. Users will be allocated a new phone number beginning with the prefix 0877, so they can receive calls on the service from other voice-over-internet users.

Business Day