Ispa urges Telkom unbundling

2011-08-15 09:30
Ispa joint-chair Jaap Scholten has said Telkom could earn more revenue if the telco splits. (Duncan Alfreds, News24)

Ispa joint-chair Jaap Scholten has said Telkom could earn more revenue if the telco splits. (Duncan Alfreds, News24)

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Cape Town - Cape Town - Telkom should completely unbundle its hardware in order to facilitate better access for broadband delivery in SA, the Internet Service Providers' Association (Ispa) has said.

"From Ispa's point of view, something like splitting up Telkom into a wholesale and retail department is a very good idea. Understand that that has already happened to an extent," Dominic Cull, Ispa regulatory advisor told News24.

Some commentators have called for Telkom to be split so the infrastructure could be shared by a number of firms who would provide services.

"The [Electronics Communications] Act says you must separate those things out so what they've done is they've put Chinese walls up between wholesale and retail and now with 8.ta as well, Cull added.

He insisted that Telkom leverages its virtual hardware monopoly and offered companies the ability to offer broadband services to homes in the country.

Unbundling

"What is Telkom's strength at the moment? It has the fibre in the ground; it has more than anyone else. I think there's 500 000km of copper that Telkom has in the ground.

"Telkom should be now taking an approach where it's not resisting local loop unbundling, but is saying 'How do we leverage the assets which we have to make that we remain relevant the future?' And they seem very intent on not doing it."

"It would be a whole new revenue stream on an old asset," said Ispa joint-chair Jaap Scholten.

Local loop unbundling has been applied in developed economies of the UK and US, and section 5 of the World Trade Organisation's General Agreement on Trade in Services mandates "interconnection between fixed network suppliers".

"The Electronics Communications Act is all about open access and really when you see companies like Vodacom and MTN co-operating on laying down fibre, they're starting to get the picture about 'We can share'," Cull said.

Potentially, the sharing of costs by these companies and consortiums would result in a faster rollout of the broadband infrastructure while at the same time, not impacting as much on the bottom line.

ISPs frustrated with the slow pace of broadband expansion have begun laying their own cable even though ISPA said that this was not their core function.

Cost

"That's the stage at which an ISP becomes a telco. An ISP is not really in the business of laying down infrastructure, but a lot of ISPs are making that jump from being an ISP to a telco," Cull said.

Companies like Dark Fibre Africa allows users to use its cable and in Durban, the city plans to allows fibre optic cables to go through the sewer system.

The cost of broadband is a major concern despite the fact that SA is increasing capacity exponentially. Users are unable to access the service due to unavailable or expensive "last mile" connections.

"I happen to live in Kommetjie. How do I get that fibre out to Kommetjie - that's the metro reticulation. That's the challenge," Cull said.

"You need those broadband cables for the fibre backbone, otherwise it just costs too much to push it over satellite," said Brett St Clair head of mobile at Google South Africa.


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