Al­tech rul­ing will grow com­pe­ti­tion

Finweek English Edition - - Ict - Rob Lith

Com­pe­ti­tion will be a great con­trib­u­tor to bet­ter prices. ACT­ING HIGH COURT JUDGE Nor­man Davis’s find­ing in favour of Al­tech in its case against reg­u­la­tor Icasa and the Depart­ment of Com­mu­ni­ca­tions about the right of Vans li­censees to self-pro­vi­sion in­fra­struc­ture – and his sub­se­quent rul­ing to not grant Com­mu­ni­ca­tions Min­is­ter Ivy Mat­sepe-Casaburri leave to ap­peal – means South Africa is head­ing for tele­coms dereg­u­la­tion on a mas­sive scale.

How­ever, al­though more than 600 Vans are the­o­ret­i­cally el­i­gi­ble to be­come full-blown tel­cos, it’s un­likely all those will step up to the plate. In fact, there only likely to be a hand­ful of play­ers do­ing so. But those might be enough to drive com­pe­ti­tion to new heights.

Though Neo­tel’s en­try into the mar­ket has un­doubt­edly had a pos­i­tive ef­fect on pric­ing and ser­vice lev­els it must be feel­ing a lit­tle put out – af­ter all, it paid a small for­tune and fought tooth and nail for its li­cence. Two years later the mar­ket looks com­pletely open.

In­ter­est­ingly enough, Neo­tel has wel­comed in­creased com­pe­ti­tion in the in­dus­try in SA. “In­creased com­pe­ti­tion will re­sult in the con­sumer ben­e­fit­ing from bet­ter pric­ing and ser­vice,” says CEO Ajay Pandey. “At the end of the day all tele­coms play­ers should be en­cour­aged to do what they can to of­fer the pub­lic a bet­ter ser­vice at a bet­ter price.”

Pandey says new com­pe­ti­tion drives in­no­va­tion and ser­vice lev­els and that will ul­ti­mately be good for SA’s African tele­coms in­dus­try. “ The cur­rent court process doesn’t change our po­si­tion on that view. We’ll con­tinue to strive on our part to bring down the cost of telecom­mu­ni­ca­tions for all,” he says.

While Con­nec­tion Tele­com di­rec­tor Rob Lith agrees com­pe­ti­tion will be a ma­jor con­trib­u­tor to bet­ter prices, he says the is­sue of in­ter­con­nect pric­ing has yet to be ad­dressed. In­stead of ac­tively work­ing to­wards a more ben­e­fi­cial pric­ing struc­ture for all play­ers, Lith says op­er­a­tors con­tinue to charge the Icasa reg­u­lated rate. “This ‘reg­u­lated rate’ pre­scribes a max­i­mum rate a telco provider can charge each other for in­ter­con­nect – but it doesn’t state a min­i­mum,” Lith says.

While the pres­sure is on Icasa to ad­just the in­ter­con­nect rate, the in­creased mar­ket com­pe­ti­tion might see it com­ing down – with smaller play­ers band­ing to­gether to cre­ate a favourable en­vi­ron­ment for each other.

How­ever way it hap­pens, Lith says the ac­cepted mar­ket rate must come down, since it’s cur­rently ham­per­ing the abil­ity of play­ers (in­clud­ing Con­nec­tion Tele­com) to re­duce costs for their cus­tomers by us­ing VoIP and other com­ple­men­tary tech­nolo­gies. “It will also cre­ate a more com­pet­i­tive land­scape and al­low even the small­est of play­ers to con­trib­ute.”

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.