Eassy Consortium Reaches Crunch Point

[rpm]

http://mybroadband.co.za/nephp/?m=show&id=1989

 

[MaD]

There should be no artificial barriers to investing in the international fibre project and it should be possible for an investor to sell on its share to another investor subject only to an agreed procedure. At present, EASSy is demanding that potential investors have an international gateway licence. As it must know, access to these have been severely limited in many countries to protect the incumbent telco.

Problem.

There are a couple of worrying sentences in the article.

 

[stoke]

That's what I said the first time they mentioned the license issue.

 

[DVDA]

Investors need to have a gateway license (at present), not users. That does not mean that the investors can limit access and fix pricing.

 

[Sneeky]

Sure, but limit the licenses to a select few and then they end up agreeing a suitable price that's suits them, not the consumer, collusion.
Telkom, SNOT and Sentech will sit around and agree bandwidth costs from Eassy for SA. All owned or partially owned by the government at the end of the day anyway.

 

[DVDA]

I thought the rate was fixed throughout the entire consortium, and decided by management?

 

[kilo39]

EASSY CONSORTIUM REACHES CRUNCH POINT
International fibre bandwidth is expensive to build and its life is time-limited, usually to 25 years. Therefore it makes practical commercial sense to organise it in such a way that the maximum use is made of whatever capacity can be provided over as longer period as possible. In order to achieve this, those building the fibre need to adopt two approaches simultaneously:

1. Taking into account the need to operate and maintain the cable, the pricing of the international fibre capacity must be as low as possible in the initial period, with the pay-back being spread over the full 25 year life of the cable.

2. The investors in the cable need to take the view that the existence of the lowest possible commercial international fibre prices will allow them to make their money from their core businesses – fixed or mobile telephony and national infrastructure – or from other businesses building services and applications that make use of their networks. In other words, the cable exists to help everyone make profits at a country level, not to be highly profitable in itself. -
-
There cannot be “gatekeepers” in the system who keep prices artificially high as there currently is with SAT3. Furthermore, each country needs at least two competitive providers of both inter-regional and international capacity or the alternative is the rather unpalatable prospect of price control

Telkom have been operating exactly the opposite business model (on sat3): 'gatekeepers', and 'maximum use', etc. Telkom have the brains to keep it a limited resource - at the whole countries expense - and now their's - they haven't utilised sat3 correctly - should be taken away from them.

 

[stoke]

Read it a bit deeper :

<Q>We want (our members) to make money out of the services provided. It will kickstart a lot of economies. At present there are projections for 30-40 mb going by satellite. (Paying for that) is a terrific cost to the continent (in foreign exchange). We want to double that capacity and keep the foreign exchange in the continent.</Q>

No no no no no no no no ... do not make money from the cable. The services that your countries can provide by making use of this cable at the lowest possible cost will boost the economy of your contries instead of lining a few pockets. Run it at cost. You blithering idiots !

Grrrrrrrrrrrrr !

 

[kilo39]

The investors in the cable need to take the view that the existence of the lowest possible commercial international fibre prices will allow them to make their money from their core businesses - In other words, the cable exists to help everyone make profits at a country level, not to be highly profitable in itself.

They're saying they should run it at the lowest possible price - and everybody should make profit off the bandwidth.

@stoke: The services that your countries can provide by making use of this cable at the lowest possible cost will boost the economy of your contries instead of lining a few pockets. Run it at cost. You blithering idiots !

@stoke: But isn't this what they are saying - ?