kilps
Expert Member
What's the problem with the South African telecoms market and adsl anyway?
For want of a starting point for people who aren't sure about everything which we all know about I thought that an 'introduction thread' might be appropriate.
Any corrections or things to add I'll edit in, perhaps we can try and keep this up to-date as possible
Basic Rundown
Most people's problem is dead simple, in South Africa is just costs too much to use basic telecommunications services. The reasons behind this problem are numerous but first let us take a basic look at what the effects of this are:
Ok, but why Telkom?
Ok - now what is the story with ADSL and broadband?
Broadband internet, when used properly, is an amazing thing. Users are able to stay connected to the internet 24/7, stream their TV and music off the internet, use it to make phone calls and a lot more.
The problem lies in the uniqueness of our current situation: that is that Telkom owns the only cable connecting South Africa to the rest of the world (Internet Solutions and some other companies do use satellites but this is expensive and not nearly as reliable as cable). Therefore no one actually knows how much international bandwith really costs - and Telkom is free to sell it for exorbitant prices.
This, amongst other things, has led to the following absurd ADSL setup:
What is important to know when dealing with telecoms companies in SA?
Well at least in the case of Telkom and ADSL: never sign a contract - besides the 'free' modems the offer you often being of infferior quality it prevents you from switch to another provider should they become cheaper - which is what they want you to do
I think this section could be pretty important - what do people have to add here?
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Ok that's enough for today I think - could others please give their feedback on what else is needed and I will add more and correct spelling
soon...
I was also just thinking that prehaps what we as a community need is a wiki were all this sort of information as well as topical event could be stored - that way everything could be properly documented... just a thought
For want of a starting point for people who aren't sure about everything which we all know about I thought that an 'introduction thread' might be appropriate.
Any corrections or things to add I'll edit in, perhaps we can try and keep this up to-date as possible
Basic Rundown
Most people's problem is dead simple, in South Africa is just costs too much to use basic telecommunications services. The reasons behind this problem are numerous but first let us take a basic look at what the effects of this are:
- The average person cannot afford a basic telephone line (the percentage of households with a fixed line is in fact less than it was in 1994 - www.hellkom.co.za)
- Important industries such as Call Centres and Online companies cannot operate effectively due to high costs
- It leaves South Africa a long way behind the rest of the world not just in price, but in other industries as well
- Simply put, being a third world country is no excuse in our case because most of our infrastructure is left over from being a 'first world' country during the apartheid era
- But more importantly we have to look at the profits of the telecoms providers - Telkom's (see below for why they are targeted) profits for the last financial year were in excess of R9 Billion - you can see a nice graph representing Telkom's profits from the past couple of years here
Ok, but why Telkom?
- As the only functional landline provider at the moment (the SNO is expected to begin business later this year, but who knows) Telkom is the only provider of a very basic service - and is doing so in it's very own monopolistic enviroment
- Telkom was at one stage a purely state-owned company which means that alot of the infrastructure which Telkom owns was paid for with tax-payers money
- It is more important for most people that a basic landline is very affordable instead of a cell-phone line, as the latter would probably follow on
- When Telkom was privatised the government kept a 40% stake in the company - what this has done is create a conflict of interest: on one hand government has a nice fat revenue stream which makes running the country a little bit easier and on the other they should be helping to improve the current prices to help grow the economy
- The industry is meant to be controlled by ICASA - who is supposed to control prices and the like. The problem is that (as many believe) ICASA is in fact just a toothless regulator.
- The minister and her department at the Department of Communications (DoC) are also often critised as being incompetent.
Ok - now what is the story with ADSL and broadband?
Broadband internet, when used properly, is an amazing thing. Users are able to stay connected to the internet 24/7, stream their TV and music off the internet, use it to make phone calls and a lot more.
The problem lies in the uniqueness of our current situation: that is that Telkom owns the only cable connecting South Africa to the rest of the world (Internet Solutions and some other companies do use satellites but this is expensive and not nearly as reliable as cable). Therefore no one actually knows how much international bandwith really costs - and Telkom is free to sell it for exorbitant prices.
This, amongst other things, has led to the following absurd ADSL setup:
- When you have ADSL you have to have a normal landline as well, even if you don't use it, this charge is supposed to pay for the piece of copper connecting you to your exchange
- The second cost when you have ADSL is the ADSL line rental (which varies depending on the speed you use - even though the same cables are used regardless of speed) - now are we seeing a problem here? Didn't we just pay for our voice line rental? You see both line-rentals pay for the same cabling
- The third cost is your ISP cost - your ISP connects you to the rest of the internet
What is important to know when dealing with telecoms companies in SA?
Well at least in the case of Telkom and ADSL: never sign a contract - besides the 'free' modems the offer you often being of infferior quality it prevents you from switch to another provider should they become cheaper - which is what they want you to do
I think this section could be pretty important - what do people have to add here?
---------------------------------------------------------
Ok that's enough for today I think - could others please give their feedback on what else is needed and I will add more and correct spelling
soon...I was also just thinking that prehaps what we as a community need is a wiki were all this sort of information as well as topical event could be stored - that way everything could be properly documented... just a thought
Last edited:
... I don't see why this sort of thing shouldn't be on a tab on the home page, something like 'Our Story'... It pretty much somes up why the site was started and what our goal is, and could explain to newbies why we are here and what we intend to do... 
