Telkom split may open SA broadband

2014-01-20 12:10
Telkom. (Duncan Alfreds, News24)

Telkom. (Duncan Alfreds, News24)

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Cape Town - Telkom has split its retail and wholesale divisions in compliance with a Competition Tribunal ruling, a report says.

According to a BusinessTech report, the state owned telco published a code of conduct detailing how its employees of the retail and wholesale division should conduct themselves.

The document specifies that no special treatment nor exchange of competitively sensitive information should be shared between the two divisions.

Many industry analysts have, for several years been calling for a split in Telkom to facilitate faster delivery of cable broadband services to the wider section of the South African population.

"Telkom should be split into two companies - one should be an infrastructure company that provides broadband and fixed line infrastructure to direct to consumer ISPs and telcos, this company should be prohibited from dealing with end consumers," Fontera Digital Works CEO Simon Leps told News24.

ADSL subscribers

He added that the commercial division would have to compete with other providers to offer services.

"That way there is a single company that is responsible for providing broadband and fixed line infrastructure to all others in SA. It also stops Telkom from being its own customer and forces it to provide a level playing field for all other ISPs."

It is estimated that there are around 800 000 ADSL subscribers in SA, most of whom rely on Telkom hardware for the delivery of services.

It is likely that if other companies offering services on the Telkom network could compete equally, prices for cable broadband would decline rapidly, in keeping with the government's policy of expanding broadband access.

Some have called for broadband to be considered as a fourth utility to speed up the rollout of services.

"The government should look at broadband as a fourth utility - that's the only way it can work," Alpheus Mangale, managing director of Cisco told News24 recently.

Broadband should be added to the existing utilities of water, electricity and sewerage to facilitate faster rollout of services, especially in rural areas, Mangale insisted.

The Draft National Broadband Policy has called for the expansion of Telkom's network to third party providers, though the policy will only be finalised in March.

"Although a large number of internet service providers can provide internet services over ADSL, their ability to differentiate their offerings and service levels is limited by that fact that there are only three points of interconnect on the Telkom network, which effectively makes them entirely dependent on Telkom for domestic networking," the document says.

Read more on:    telkom  |  internet  |  broadband
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