ISPA wants cheaper broadband

2010-05-24 13:19

Johannesburg - The Internet Service Providers' Association of SA (ISPA) had called on both the Independent Communications Authority of SA (Icasa) and telecommunications company Telkom to lower the price of broadband.

In a statement on Monday, ISPA said the 'Telkom tax' was one of the factors still keeping broadband prices artificially high. "There is scope for line rental charges to be restructured and reduced," ISPA said.

In particular, consumers should not be forced to take a voice line to access an Asymmetric Digital Subscriber Line (ADSL).

"We applaud the many steps that the South African broadband market has taken forward in recent months, especially with competition in the undersea cable market driving bandwidth prices down dramatically during 2010," ISPA said.

"However, South Africa's high line rental costs remain a major barrier toward wider adoption of broadband in the country," ISPA general manager Ant Brooks said.

Telkom tax

"While we accept that Telkom and other fixed-line providers incur a cost providing line infrastructure, we believe that fees for analogue line rental and ADSL access should be lower."

Brooks pointed out that the analogue line rental and DSL access costs for a 4Mbps (megabytes per second) ADSL service alone cost R544 a month, which meant that high-speed DSL access was unaffordable for most South Africans before bandwidth costs were even factored into the equation.

"A major part of this cost - R131 - is related to an analogue voice line rental tariff for a service many consumers don't even want," he added.

"But we also believe that there is some scope for the access portion of the tariff to be brought down."

Brooks said Telkom was able to impose a tax because of its stranglehold on local loop infrastructure, which was in turn a product of its protracted monopoly period.

"Although ISPA would be happy if Telkom would proactively look at this issue, it may be necessary for Icasa to address it with new regulations."

The margin on ASDL access should be greater, but this should not mean that the price to consumers should be higher. ISPA said it would instead support a more equitable distribution of ADSL revenues between ISPs and Telkom.

Transparency

"ISPA understands that there is a need for ADSL access charges since there is a cost component associated with this infrastructure.

"ISPA also understands the need for differential pricing according to the speed of the line since higher-speed lines need more backhaul bandwidth."

However, the organisation said it wanted more transparency and equitability in how access charges were billed to ISPs and consumers.

Line rental and ADSL access were among the few elements of total ADSL costs that had not come down over the past few years, Brooks said.

- SAPA