Interconnect rate battle: Why now?

Sting

Ghost in the Machine
Joined
Mar 4, 2009
Messages
27,435
A further factor could be Telkom's entry to the Mobile market. Nyanda and September smoke peace pipe and find way to do damage control after loss of cash cow. Also could reduce VC profits/dividends and halt flow of money out of country via Vodafone.
 

kilos

Expert Member
Joined
Jun 28, 2005
Messages
2,770
Interconnection rates were 20c in 1994, but Vodacom and MTN managed to convince Icasa to allow them to increase them by 635% to the current R1.25 shortly before Cell C entered the market.
:eek: but that is over 15 years, they should be dropped

ISP do not charge interconnect charges what gives mobile companies the right ??

Interesting to observe Telkoms involvement in the mobile industry over the next few months, hopefully offer the customers a better,lower prices than VC & MTN.
 

Lightscribe

Banned
Joined
Sep 10, 2007
Messages
5,695
The other key point we can take from this whole saga is the fact that government cannot play the role of policy director in sectors in which it is heavily invested, because it may be looking after its own interests and not those of South African consumers.

Government and government employees, must be forced to disinvest in telkom and any industry.

Government having any investment in any industry, leads to corruption, nepotism and the poorest of services.

Politicians and all public servants with investments in any industry should be investigated and jailed for intention to defraud, even in the absence of actual proof.

The proof of intention to defraud is in the act of having investments in industries, whilst a public servant.

The proof of intention to defraud is also in the act of being a public servant, whilst investing in Industry.

Government are the servants of the people. Servants of the people work for the people, at a public servant's salary.

Not for other industries, at executive salaries, with the public servant job as the tool to create personal wealth.

All should forfeit all finances and property, as per the Organised Crime Laws.
 
Last edited:

Tpex

Teh Cyber Ninja
Joined
Sep 4, 2008
Messages
18,189
Last edited by a moderator:

Johnfpro

Senior Member
Joined
Jun 6, 2009
Messages
537
I think that the answer lies in Telkom's entry into the mobile industry.

Cost of entry would be high if the interconnect rates were high as Telkom is not a major player. With Telkom (government) being the only remaining "trading" potential cash cow for the government (ANC?) now that VC has gone, it makes total sense to reduce any costs that it (Telkom) cannot control directly to minimise costs of entry and sustainability.

Call on Big Brother for help as in the past
 

Kawak

Senior Member
Joined
Mar 14, 2007
Messages
700
Not that I'm not happy with the interconnect thing happening now but I just can't seem to believe its out of good will by gov, until ICASA can be comepletely transparent and its members elected directly by the people, I can't see how the gov won't use it in some way to further its evil agenda.

Just look at LLU, still nothing is happening there, once vodacom becomes "non gov" then its time to hammer it down to a manageable level, but LLU hurts telkom so lets drag it on for as long as possible.
 

Lightscribe

Banned
Joined
Sep 10, 2007
Messages
5,695
LLU is coming...2011...telkom are "defending and growing their existing profits"...But, they will release it...when it suits them as per profits from their massive push wih FTTH and mobile.

They claim landlines are currently running at a loss for them. They cling to it nonetheless.
 

Kgabogk

Expert Member
Joined
Aug 12, 2008
Messages
1,066
This kind of publicity preceeded the launch of Seacom,our hopes were raised to the highest reading,every consumer was waiting for a big bang crash in data pricing...The D-day came and went,we are still pay yester year prices for data with no relieve on the horizon.
 

Just_Ice

Executive Member
Joined
Mar 8, 2008
Messages
7,573
I think that the answer lies in Telkom's entry into the mobile industry.

Cost of entry would be high if the interconnect rates were high as Telkom is not a major player. With Telkom (government) being the only remaining "trading" potential cash cow for the government (ANC?) now that VC has gone, it makes total sense to reduce any costs that it (Telkom) cannot control directly to minimise costs of entry and sustainability.

Call on Big Brother for help as in the past
This what I suspect as well. Now that Telkom will be starting their own mobile network, initially it will help telkom if interconnect rates are dropped so that they can become fairly significant players in the market. Government has reason for everything even if it isnt in our best interests, dropping interconnect rates is good for telkom, and therefore good for government.

LLU is coming...2011...telkom are "defending and growing their existing profits"...But, they will release it...when it suits them as per profits from their massive push wih FTTH and mobile.

They claim landlines are currently running at a loss for them. They cling to it nonetheless.
I dont see this happening, even if the lines are running at a loss, can you imagine the loss of income should LLU go ahead? Consumers would flock to other ISPs in droves and there would be an incredible loss of earning from fixed lines for telkom. They would rather have the lines run at a loss, than have the majority of their clients leave them.
 

Lightscribe

Banned
Joined
Sep 10, 2007
Messages
5,695
I dont see this happening, even if the lines are running at a loss, can you imagine the loss of income should LLU go ahead? Consumers would flock to other ISPs in droves and there would be an incredible loss of earning from fixed lines for telkom. They would rather have the lines run at a loss, than have the majority of their clients leave them.

I also feel they will try to hang on forever. But, they know they cannot. They will thus release at an opportune time, such as the moment the High Speed and mobile products' income can offset losses on the landlines.

The majority of telkom clients will need to be high end users. They intend dumping the low speed products, although the exact times will be determined by their success at the other ventures.

...or guavament forcing it, due to guavament's inability to fend off demands from the public any longer...

We only need to stir up a few thousand starving shack dwellers, with the knowledge that they are being kept in their misery, because the fat slobs that imagine they run they country, will not allow them to be educated... :D
 

Arko2

Well-Known Member
Joined
Mar 3, 2007
Messages
379
Comparing?

Since S.A. are now Members of the BIG G20 should we not now Compare
the Price Structures of the 20 Members. Communication, ADSL, Penetration,
Subscribers. The EU had a couple of month ago the SMS Costs investigated,
it stated that a SMS is a byproduct of the Cell Phone, so it hardly costs
anything. A SMS goes seconds on the connection but no Call. Prices dropped.
 

Lightscribe

Banned
Joined
Sep 10, 2007
Messages
5,695
Since S.A. are now Members of the BIG G20 should we not now Compare
the Price Structures of the 20 Members. Communication, ADSL, Penetration,
Subscribers. The EU had a couple of month ago the SMS Costs investigated,
it stated that a SMS is a byproduct of the Cell Phone, so it hardly costs
anything. A SMS goes seconds on the connection but no Call. Prices dropped.

This is Africa. Pain teaches. Knowledge is spat on. We need to shove red hot pokers up the a***s of these monkeys in silk, if we want anything done.

That's great argument, but then, with Ghaddafi trying to be the African Union President...and our president being the joke of the century, I doubt knowledge helps.
 

alt21

Senior Member
Joined
Apr 4, 2008
Messages
770
y would they drop sms rates if they have ppl sending millions a day, there should also be laws put in place to stop these sms competition / money making schemes. Now adays almost any product you but is merely a means for the manufacturing company to advertise some sms competition.
 

Mouse

Expert Member
Joined
Dec 31, 2005
Messages
2,329
But a more cynical analysis of the political will to solve the conundrum would point out that only now that government is no longer benefitting from the massive profits generated by Vodacom is it getting serious about regulating interconnection.

This is what I believe caused the reaction from government. If they sell their Telkom shares (or if Telkom becomes totally worthless to them) we will see broadband in SA progress very quickly.
 

entrepr

Expert Member
Joined
Oct 24, 2005
Messages
2,196
We assume operators lose money by dropping interconnect rates. In fact, lower costs increase call volumes and the overall revenue can actually go up (elastic demand). Countries like the UK have gone through and we can judge from their financial statements. The outcome depends on how well operators handle the change as it requires more capex spend by operators and does open competition.
 
Top