How to save Telkom: Free the local loop

[fvdbergh]

The problem is that it will cost us consumers more and not less. As per the article Telkom have an access deficit - they are making a loss on the local loop. If the LL were to be sold to another company, that company will have to charge you at least what it is costing them. Ergo - rental increases...

Yes, everyone keeps saying this, i.e., that true operations costs of the copper line is ~R300 p/m. What I would like to see is how that breaks down for different areas. I get the impression that they are averaging all the costs (i.e., replacing stolen copper) over the whole customer base, which is not fair in my opinion. In essence, Telkom should be allowed to run their business where it is profitable to do so. I know that at some point they were forced to bring phone lines to the furthest reaches of SA. Is that what is now costing us an arm and a leg?

The mobile operators are better at covering the high risk / remote areas anyway. Let Telkom focus on the areas where it still makes sense to have fixed-line infrastructure. I honestly can not believe that my own copper line costs R300 p/m to run.

 

[Sting]

I know that at some point they were forced to bring phone lines to the furthest reaches of SA. Is that what is now costing us an arm and a leg?

Yes.

 

[DblD]

Is author claiming that Telkom financial reports are false? Cos for years they have been reporting profits in ranges of 1000's of millions after tax!!!!

 

[davemc]

Is author claiming that Telkom financial reports are false? Cos for years they have been reporting profits in ranges of 1000's of millions after tax!!!!

Telkom also used to own a massive steak (haven't had supper yet, can you tell?) in Vodacom, which provided a nice slice of profit.

 

[entrepr]

Did the math once.

Part of the reason for the high cost of copper is they're using ancient technology. With ngn at class 5 you can reduce the equipment overheads massively and reduce downtimes.

Next - to recover costs better you need to introduct ADLS 2+/VDSL to really get those bytes pumping down the line - make sure far more people are sending far more bytes. It's not going to happen when they're stuck on 384kbps.

Finally - add services - esp video so you bump up the revenues

If Telkom don't have the courage to follow global telcos and move with the times on these, they have themselves to blame