Bringing telecoms costs down and the need to unbundle the local loop still top of mind Despite several programmes initiated by the government to lower communications costs in South Africa, the issue of bringing telecoms costs down and the need to unbundle the local loop dominated discussions at ITWeb`s 2007 Broadband and Wireless conference in Midrand recently.

Kicking off the conference, Department of Communications deputy DG Rosey Sekese outlined government`s five-year broadband plan. "There is still a lot we need to do. Countries that are not jacked-up will fall behind. When it comes to access to broadband infrastructure, we are currently number 70 in the world." She identified affordability, access, content and skills as the major obstacles facing a mass broadband roll-out at the moment.

She said government is setting up an ICT institute that will be up and running by February 2008 and is enlisting strategic interventions, including Nepad`s Broadband Infrastructure Network and Infraco`s backbone cable, to bring down communications access costs.

Renita Moonsamy, Group Executive: Commercial for Transtel, said broadband penetration is very low in the Middle East and Africa region because of low literacy and low income. The timeframe for the licensing of a WiMax frequency spectrum remains a big inhibiting factor, she said.

Taylor Reynolds, an economist with the OECD`s Science, Technology and Industry directorate, argues that the biggest inhibitor remains Telkom`s de facto monopoly. Reynolds argues that Telkom charges high broadband prices simply because it can.

NEOTEL ALIVE AND WELL

Meanwhile, Neotel says that contrary to concerns in the marketplace, it is alive and well and capable of delivering services. Head of strategy Angus Hay says the second national operator has been quietly signing a number large of deals in the enterprise space, including multinationals.

Hay also announced plans to launch converged voice/internet services to the wider enterprise market soon. However, it will be a longer while before consumers see communications services from Neotel, as the company is still engaged in trials.

UNBUNDLING THE LOCAL LOOP

The issue of unbundling the local loop, including the potential costs and logistics of this also featured at the conference. Sunrise Consultants MD Robert Hall presented a number of models that SA could follow to unbundle the local loop speedily.

Hall presented case studies where the local loop was unbundled in short periods, including war-torn Lebanon and Pakistan, where it was done in seven months.

REGULATORY UNCERTAINTY

ICASA councillor Tracy Cohen said while the conference had the luxury of debating deadlines for unbundling the local loop, the regulator`s mandate was clear: to unbundled it by 2011. Cohen also dealt with criticisms levelled at the regulator by the industry, including allegations that ICASA is not moving fast enough in getting the South African telecoms industry into a new regulatory framework based on the EC Act.

She said ICASA was aware there was uncertainty in the ICT sector during the change to the EC Act, despite the agreed-upon two-year transition period. "This might not be fast enough for your liking, but I can tell you we are on track."

WHAT NEXT?

Meanwhile, operators are also struggling with the challenge of building next generation networks, as they typically have working networks and it`s difficult to justify the investment to a new network. Vodacom SA managing executive of managed services Johann Pretorius said mobile networks also have to move to IP-based transport and control to improve the quality of service even while also lowering transmission costs.

MTN general data manager Brian Seligmann said that while Africa faces a number of challenges, the continent also provides vast opportunities for business.

Seligmann says the number of African mobile subscribers is expected to grow from 240 million to 32 million between 2007 and 2012. An expected 100 million subscribers in the next five years is a massive opportunity for business in Africa, he says.