Information Technology Reference
In-Depth Information
This was first mooted in 2006. The Minister of
Communications at the time, Ivy Matsepe-Cass-
abury, took a policy decision that the unbundling
process should be implemented and completed by
2011. Although little progress has been made to
date, this is once again on the industry regulator's
agenda and has been highlighted as a strategic
objective in their recently released 'Programme
of Action'.
tions and broadcast sectors) and the Independent
Communications Authority of South Africa (the
body tasked with regulating the sector) have a
chequered past in this respect. ICASA is widely
regarded as being ineffective and 'toothless' - the
body frequently backs down in the face of legal
action if an operator happens to disagree with a
directive or policy stance.
The Department of Communications, until
very recently, had preferred a 'managed liberali-
sation' approach which under the guidance of the
late Minister of Communications, Ivy Matsepe-
Cassabury, saw the status quo held untouched for
several years.
The frustrations of local users are evident in
their thousands and are vented on a daily basis
on activist sites such as www.MyBroadBand.
co.za and www.Hellkom.co.za (a pun intended
on combining the words 'hell and 'Telkom').
Yet, consumers' voices are still largely ignored
and prices remain out of synch with international
standards.
Hope may arise in the form of local munici-
pal networks and wireless user groups, intent on
providing residents with low cost or even free
Internet access. These fledgling networks are
starting to surface and are already in existence
in Knysna (a small coastal town) and within the
Gauteng (Johannesburg and Pretoria) region. Both
models are based on Wireless Fidelity (WiFi) mesh
networks such as those deployed in Philadelphia
and San Francisco. The municipalities of Cape
Town, Durban and Johannesburg are thought to be
in favour of such developments and are planning
similar projects of their own at the time of writing.
As the power engine of the sub-Saharan
economy in Africa, broadband may prove a key
ingredient to economic growth and prosperity
within the country. Research clearly indicates
a strong correlation between broadband adop-
tion and GDP growth (OECD, 2009). Yet, there
are other national priorities - namely, fighting
HIV/AIDS, constructing housing, improving
primary and secondary education systems, and
CONCLUSION
The emergence and growth of broadband players
in the market in certainly cause for celebration.
Convergence also appears to be taking hold.
Traditional voice-oriented players such as Tel-
kom, MTN and Vodacom are shifting their focus
to broadband services, whilst traditional data-
oriented players (such as Internet Solution) are
marketing VoIP offerings. Competition is therefore
intensifying as these companies congregate on
the broadband space.
Backhaul (national) and international con-
nectivity, as well as the local loop, remains
troubling. Two companies, Neotel and Telkom,
control access to the SEACOM and SAT-3/SAFE
international gateways, as well as being respon-
sible for the bulk of intercity backhaul traffic in
South Africa. Telkom maintains ultimate control
of all fixed-line broadband connections through
its ADSL service, whether the end-user is a direct
customer of Telkom or not. MTN and Vodacom
sew up the remainder of the broadband market
through provision of their 3G/HSDPA services.
Wholesale prices still remain artificially high as
a small set of players (effectively reflecting an
oligopoly scenario) has tight control over these
electronic pipelines.
The political will is required to further liber-
ate the market or to forcibly drive down prices,
at the wholesale level, through legislation. Un-
fortunately, the Department of Communications
(responsible for overseeing the telecommunica-
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