Your call has been placed on hold

Ben Kelly

Ben Kelly is a columnist at MyBroadband, and writes about basically anything in the tech world which he finds interesting. He is also a...

Full Profile

E-mail

Although Altron CEO Robbie Venter doesn’t believe the court application launched by subsidiary Altech Autopage Cellular could delay the deregulation of the entire industry, that’s what some fear.

Speaking on the sidelines at Altron’s recent full-year results, Venter said although the matter was subject to a court process, and therefore sub judice, the group saw it as an important step towards protecting its position and that of its shareholders. “We just want a response in terms of what process will be followed.”

However, the problem with court battles is they can potentially tie up interested parties for years. And in this case 24 other value-added network service providers (Vans) have been named as respondents.

Autopage named them, according to Altech’s chief technology officer Steven Sidley in his affidavit, because those Vans had apparently also applied for licences to build their own networks and so may have an interest in the outcome (but it’s not seeking damages from them).

Interestingly, incumbents such as Vodacom and MTN, which potentially have an interest in the outcome of the court case, as they’re also waiting for their licences to be converted – weren’t named as respondents. However, Internet Solutions CEO Angus MacRobert says it will include them in its response.

Autopage launched an urgent interdict – which came before the High Court on 13 May – against regulator Icasa, its chairman, Paris Mashile, and the Minister of Communications to halt the licencing process. It wants Icasa to quit the competitive process it’s engaging in and “automatically” convert individual electronic communication services (ECS) and individual electronic communication network services (ECNS) licences, in terms of Section 9 of the Electronic Communications Act (ECA).

In terms of the new Act, most Vans will become ECS licensees (either individual, if national or provincial in scope; or class, if serving a local community). Those who want to be able to roll out their own fixed-line or wireless networks would need an ECNS license.

Neither the Communications Ministry nor Icasa believes all Vans should be able to provide their own networks, while many Vans believe that’s exactly what they should be entitled to do in a deregulated market. Communications Minister Ivy Matsepe-Casaburri backtracked in that regard in 2004, causing much consternation in the industry. However, it had been hoped that would have all been sorted out by now – but the enabling ECA has yet to be implemented.

Icasa says it will oppose Autopage’s application but won’t comment further. The department hadn’t responded at the time of writing.

BMI-Tech senior telecoms analyst Richard Hurst says even though some Vans have downplayed it, self-provisioning is very important to them. “Another delay in the process will have a negative impact on those companies … That impact will be felt, in that they’ll lose the opportunity to cut costs through controlling their own infrastructure.”

Hurst says self-provisioning allows companies to avoid the situation where service providers are beholden to network operators “which can change the rules at any point, as has been the case with Telkom in the past”.

SA’s telecoms environment has been characterized by delays – such as the third cellular license and the second national operator – and any further postponements would simply play into the hands of Telkom, MTN and Vodacom, which have entrenched positions, says Hurst.

Vox Telecom chairman Tony van Marken says it participated fully in the license conversion process, including making the required submissions to Icasa and attending the hearings. It’s being considered for an ECNS license.

Van Marken says although it’s become popular to criticize Icasa, there has been ample time for all participants to fully engage with it and the process should be completed as soon as possible “because it’s already taken far too long”.

Van Marken says it would have been one thing for Autopage to launch its application a few months ago but to do so now – near the end of the process – was an entirely different matter, as it would merely slow the pace of deregulation in SA’s telecoms sector.

Internet Solutions, another potential ECNS licensee, is working closely with Vox Telecom, as they share the same telecoms lawyer and feel equally upset by the potential implications. Internet Solutions CEO Angus MacRobert says it is disappointing that Altech has only just woken up at this stage. He says it was premature for Auopage to go to court even before Icasa had made any recommendations: “It should take legal action subsequent to that if necessary. Everyone wants this to be fast-tracked.”

MacRobert says Autopage’s application is particularly disappointing, given that it has no network of its own but merely resells GSM products and it a price taker of Vodacom’s and MTN’s tariff structures.

However, Altech wants the option of rolling out a national WiMax network in conjunction with a consortium of investors – should it decide to go that route. It’s been trialling WiMax technologies after being given a test license by Icasa.

Rumour has it that Altech wants Vox Telecom and M-Web to join it in that regard, but neither seems to have taken the bait. M-Web, another ECNS licence hopeful, said it preferred not to comment at all on the matter.

Icasa had initially indicated that only six Vans could be eligible to receive an ECNS license. Those included Vox Telecom, Verizon SA, M-Web, Internet Solutions and two seemingly curious additions: Glocal Webintact and Fleetcall. Autopage wasn’t on Icasa’s list. But after many queries from Vans, Icasa held hearings so that those wanting ECNS licences could state their case. The market awaits Icasa’s pronouncement on who’d be eligible for what license in the wake of those hearings.

MacRobert says if the deregulation process is put on hold, it means incumbent operators will get to keep pricing their products according to the same high rates – he cites the mobile interconnect rate in particular – they’ve done historically.

However, even those Vans who don’t want the right to self-provide want to see their licences converted, as the ECA effectively gives them more rights than SA’s previous Telecommunications Act did.

Electronic Communications Network (ECN) is a Vans provider that leases capacity on incumbent networks but doesn’t want an ECNS licence. CEO John Holdsworth recently said ECN supported Autopage’s application as long as it didn’t delay – “for even one minute” – the licence conversion process.

Holdsworth wants to at least see all the Vans’ licences and the ECNS-awarding process to follow, because he believes there are far more important regulations pending than the right to self-provision that could bring down telecoms costs and boost competition significantly.

The court would presumably weigh up the national interest – to bring down telecoms prices – against the interests of correcting an apparently flawed process.

Autopage legal action discussion

Finweek