Broadband. New Rules Offend

[AdLo]

http://www.tmcnet.com/usubmit/2005/dec/1219324.htm (Finanical Mail)

Internet service providers slam 'broken' broadband regulations proposed by regulator Draft regulations drawn up the Independent Communications Authority of SA (Icasa), designed to curb high prices and limit restrictions imposed by Telkom on broadband Internet access, have been met with scorn by the Internet community.

The new regulations are meant to reduce the cost of Telkom's high-speed asymmetric digital subscriber lines, which are capable of carrying voice, video and data. But Internet service providers (ISPs) fear the regulations will increase their costs and reduce demand for broadband Internet access.

In their current form, the regulations are extremely broken, lacking in both technical and financial practicality, says ISP Association (Ispa) joint chairman Greg Massel.

The proposed regulations are aimed at forcing Telkom the only company in SA licensed to provide fixed-line broadband services to reduce its prices.

Telkom declines to comment on the draft regulations, saying it will respond directly to Icasa before commenting publicly.

The publication of the draft regulations follows complaints by broadband users that the monthly charges associated with broadband are too high. Complaints also relate to Telkom's policy of limiting the amount of data that consumers may use a practice known as bandwidth capping or bit capping. This, they say, places limitations on their ability to use the Internet fully.

Icasa's proposals are ambitious. The draft regulations say Telkom and the ISPs must reach agreement on a wholesale pricing mechanism for access to the company's broadband lines. This follows complaints by ISPs that Telkom is charging them a higher wholesale price for access to these lines than it charges its own ISP, TelkomInternet.

This is the first time Icasa has mooted a wholesale pricing framework and it is a welcome development, says Internet Solutions (IS) senior regulatory manager Siyabonga Madyibi.

Madyibi says the draft broadband regulations are well intentioned but he does have concerns. He wants more clarity on how Icasa plans to implement the wholesale pricing policy as few details are given in the draft document.

If the regulations are published in their current form, it could have the opposite effect to what Icasa wants consumers could end up paying more, Massel says. Since there are no clauses dealing with the cost of wholesale capacity provided by Telkom to ISPs, it will be impossible for ISPs to offer [broadband] services without increasing their [prices]. Massel says that, in essence, Icasa is trying to force Telkom to recover part of the cost of broadband access from the ISPs, but he warns that not providing guidelines as to how this should happen will result in consumers paying more.

Massel says Icasa's proposal of providing a minimum bandwidth quota of 10GB/month (most Telkom accounts are limited to 3GB/month now) might also backfire, again because of a lack of detail in the regulations. There is nothing in the regulations to stop Telkom and ISPs from simply charging 3,3 times more (10 divided by three) than they were charging for a 3GB account.

The higher cost of facilitating a 10GB account will also increase the cost to consumers. This will result in a lower adoption rate of [broadband] and less business for ISPs, Massel warns.

The proposed increase in the minimum monthly cap comes one month after Telkom implemented a hard capping policy in which it began strictly enforcing the 3GB monthly limit. Madyibi says it would be easy for TelkomInternet to adjust to the higher cap proposed by Telkom but it would put IS in a difficult position. IS would be under pressure to provide more capacity to its customers but has limited scope to do this as it is dependent on the fixed-line monopoly for additional bandwidth. If IS rents more capacity, it will push up its costs, which in turn would put its margins under pressure.

Madyibi says more work needs to be done on the proposed regulations before IS is happy with them. In their current form, they are a bit vague, he says.

Phukubje Pierce Attorneys partner Lucien Pierce, a lawyer who specialises in telecom and technology issues, says he does not think Telkom has a legal basis to challenge the regulations. Pierce expects Icasa to play a more aggressive role in the industry. We must be prepared to see Icasa stepping in many more times in the future. But Massel thinks the sector can do without the kind of regulatory action proposed by Icasa. The biggest loser under the draft regulations will be consumers, he says.

 

[snoopy_inc]

Fair in its own words.

Its right that its vague and needs clarity.

One has to be specific if one is going to beat telkom back and make this work.

just a pity that the isp's wont work together on this matter instead of sitting on their hands and moaning about it when it happens.

Usually attitude out there.

 

[Moederloos]

just a pity that the isp's wont work together on this matter instead of sitting on their hands and moaning about it when it happens.

Did the ISPs make committed offers to ICASA to assist in the document?

 

[mbs]

[Massel is wrong]

He doesn't realise that consumers are the conerstone of continued stability and existence of an ISP and that his endeavours should be focussed there, instead of the short-term profitability of his members.
What a pity...

 

[stoke]

If IS cannot keep up, then they must fall behind.
No excuses.

 

[bekdik]

Wasn't there a public meeting and forum for discussion earlier this year? Are the current proposals not classified as 'proposed'? It is worrying when a body such as ISPA doesn't offer concrete proposals when offering this kind of broad based critism.

I also wonder who ISPA is really speaking for. Is it only the biggest players?

 

[Daaru]

If IS cannot keep up, then they must fall behind.
No excuses.

Agreed. They seem to blame Telkom for the high prices, but when ICASA steps in to bring prices down, they turn-coat and claim that ICASA is now going to start causing issues.

They should rather assist ICASA in making the document less vague as that is what the real problem is.

BTW I haven't yet seen IS dong any thing to help it's/the customers, are they?

 

[Byrd]

"after Telkom implemented a hard capping policy in which it began strictly enforcing the 3GB monthly limit"

Don't they mean "in which it changed it's capping policy without official notice to it's clients and now unfairly does not discriminate between local and international traffic"

IS is a business and as such should be trying to screw their customers. In turn though, the customers have the right to screw back.

 

[VQuest]

It appears that the only people who are complaining about ICASA's proposed ADSL changes are those who stand to lose something. Bring prices down, drop your profit margin somewhat, gain more users and make more money in the long run.

 

[snoopy_inc]

Well im going to let u all into a thought pattern that i have been having.

IF this ICASA ruling comes into play. IS is not going to have any problems what so ever. They will be laughing all the way to the bank.

My statement forthis is that the 2 new sats that are coming into play are going to be increasing their bw from 330Mb to 1Gb. according to sources is uses 280 odd of the 330Mb for adsl. (international only)

Is Should be creating new packages where as the rest of the telcoms companies are going to look stupid.

IS will have a upperhand with regards to bandwidth and i find their support superb.

Just thought ppl would like to know......

Thinking out loud again..

PS this is all happening next month

 

[stoke]

Yup, sounds quite promising - yet they [IS] moan and groan like little babies instead of going: "we like the new regulations.".
WhatsUpWithThatThen ?
/methinks that they're just riding the media bandwagin and getting the free publicity while shafting their existing clients and making them nervous and running squealing to the bank like the fat little piggies they are. It's freaking disgusting.

 

[Cloud]

We got spanked for doing 114 gigs two months ago. Our ISP is Plusnet here in the UK.

Was kinda disappointed. Although, I do get a ping of 35 to Europe, which kinda makes up for it...

 

[supersunbird]

I am offended too!!!

Especially by the ISPA guys statements

 

[doobiwan]

I knew Massel from away back and he's a smart kid. I'm guessing the article has taken his words and sensationalised them, but the gist of what he's saying is exactly what everyone one MyADSL has been saying!

I'd also be (am) exaserbated at the fact that the ADSL report took 3 months longer than expected to come out and it's, in affect, unenforcible garbage that, if implemented as is, would cripple rather than accelerate the ADSL market.

 

[Karnaugh]

[Massel is wrong]

* Greg matriculated from Carmel College in 1995.
* In early 1996, he founded CyberSurf Technologies, a Durban-based ISP focusing on the residential and small business markets. Greg sold CyberSurf to ITI Online in April 1999.
* During this period, he also consulted to numerous other ISPs, advising on and assisting with their technical infrastructure.
* From May 1999 to August 2000, Greg worked for ITI Online, assisting in the merging of various smaller ISPs into one.
* Shortly thereafter, Storm acquired the network infrastructure of ITI Online and Greg took up the position of Senior Network Engineer at Storm and subsequently National Network Manager.
* In March 2003, Greg joined DataPro, where he was involved in the design and maintenance of core network infrastructure, traffic analysis systems and various new products.
* Greg left DataPro in April 2005 and is currently taking an extended break and working on a software development project relating to Lawful Interception.

During the course of his career, Greg has created and maintained the ISP Map and been actively involved with the Internet Service Providers' Association, where he has been elected co-chair for the past four years.

Greg has also been involved in various other Internet-related organisations in the past, having served on the board of Namespace ZA for a year, participated in the AfriNIC policy working group, and ARIN public policy list and meetings.

I'd be carefull about who you say is wrong.

 

[Karnaugh]

I knew Massel from away back and he's a smart kid. I'm guessing the article has taken his words and sensationalised them.

No, believe it or not - most of the ISP's don't actualy agree with some peoples "Lets regulate everything" ideas. Those are Massel's words, the end.

 

[antowan]

No, believe it or not - most of the ISP's don't actualy agree with MyADSL's "LETS REGULATE EVERYTHING!" ideas. Those are Massel's words, the end.

We are NOT saying regulate everything. We are saying regulate what is necessary!


Some reading material Karnaugh:

Short introduction as to why regulation is important in the right conditions.
http://nes.aueb.gr/regResources.html

An example of what ballance looks like. This is a document stipulating how the UK is obliging its regulator to limit regulation only to where it really is necessary. You will find it in line with MyADSL's view...
http://www.ofcom.org.uk/consult/con.../telecoms_review/section3/?view=Welsh&a=87101

Please stop your vindictive comments Karnaugh because you are clearly trying to damage the forum and if you don't adjust the tone of your critique I will ban you. Last warning.

We accept criticism, but to spread lies is not acceptable.


You and any businessman or businesswoman reading the Ofcom document would do well to spot the following words, "Ofcom will promote competition or take other regulatory action to further the interests of consumers and citizens in the UK."

Government's priority should not lie with business if business is bad for the consumers and the country's citizens! Remember that! If you do not share this view you are not a true businessman because business is part of the world at large and what is bad for the consumers and the country at large is bad for business...

I am so SICK AND TIRED of this debate. It isn't really a debate! It is just some people who cannot see past the R and $ signs!

Karnaugh, adjust your tone...

 

[ettubrute]

We are NOT saying regulate everything. We are saying regulate what is necessary!

Actually, we would like everything to be deregulated, and have the opportunity for multiple competitive providers of tele- and datacommunication! THAT would be first price!

 

[Juice]

Unfortunately they highlight a concern I've been having as well. Let's say that Telkom is forced to abolish line rental. There is NOTHING in the draft regulations, as far as I know, that is stopping them from simply bundling the costs (formerly known as line-rental) with the wholesale pricing of bandwidth. So now your Telkom bill will have hardly anything on it, but your ISP will be debitting you for the difference. In the end, you may pay exactly the same as before and there's nothing in the draft that says they can't charge you even more. And worse, now the focus is off Telkom and everyone thinks the ISP is the bad guy.

As far as the cap is concerned, ICASA should be more clear about the INTENT of the regulations. They are ambiguous. They should say what they mean. If they MEANT that you should get a 10Gb cap for the same price as a 3Gb cap (as we all believe was the intention) then they should have said so. They didn't, so again there's nothing to stop Telkom from simply bundling the cost of the increased cap with the wholesale price of bandwidth.

So, what have we got then? Nothing. We won't pay line rental directly, and we'll be capped (internationally only though!) at 10Gb. But where you may be paying R600 a month for line rental and subscription now, you may very well still be paying R600 just for the subscription. And where you were paying R1200 per month for 3 consecutive 3Gb accounts before, you may very well pay R1200 per month for a single 10Gb acccount now. And honestly, who's going to pay that?

ISPA have a point. And if these regulations are implemented as is, I think TELKOM may be laughing all the way to the bank. When comments are heard on the draft regulations, it would be good to insist that ICASA remove any ambiguity from them. Don't put something out there that has loopholes in it big enough for Telkom to drive their gravy train through it!

I believe we can all praise the SPIRIT of the draft regulations, but ICASA have to set them up so that Telkom can't pervert them.

Juice

 

[antowan]

Actually, we would like everything to be deregulated, and have the opportunity for multiple competitive providers of tele- and datacommunication! THAT would be first price!

That would be nice, but until we have proper competition regulation is necessary...