LLU Submissions (possibly today)

Paul Hjul said:
yep and they are, but Neotel made the very good observation that Sandton has become fiberville so the ultimate points of cherry picking don't apply

using a national average line cost would allow Telkom to reduce the extent of cherry picking
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Easy to always quote the same suburb, when there are 10 others that are as profitable but aren't "fibreville"!!
 
lol fiberville is my term but all and all I was quite impressed with Neotel today
nothing from the ISPs
 
dominic said:
fibre will cherry pick those who don't sweat their assets
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stranded assets - I haven't heard the term used so many times in 2 hours before

One of the most pertinent exchanges of the workshop happened from about 51:30
Vodacom was asked about having access to stranded exchanges and said they'd be interested in copper but possibly not those areas - the remark is jestful but it is revealing.
The question is put to Telkom and the response (not a perfect transcription but I hope I am doing it justice - own emphasis etc ...) at 53:20:
Thats actually a very very good question because we don't seem to be getting a lot of interest approximately 1300 of our exchanges, where we don't have a lot of take up, where we don't have a lot of activity. We are getting interest in our active and our more fully developed exchanges.
So if we got a great offer we'd consider it. In those areas of course.
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Dr Grootes put forward the fact that the authority is not aware of any commercial offerings made by Telkom for 3rd parties to step in. The core of my view is that it is necessary for Telkom - not because of regulatory issues but simply because of Telkom's long term commercial interests that they need to bring out commercial offerings for 3rd parties of an LLU-esque nature (bitstream for example).
The reply (again imperfect transcription) to the question:
In the past, prior to Nov 25th when my feet hit the ground here, I can say I don't know. All I know is that we are looking at those areas to answer that question. How can we generate revenue here with the assets we have, what can we do to expand it. So those are the things we are considering but we don't have any offers on the table yet though.
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Now hopefully the lady from Telkom, who is a new appointee, will go to the CEO and convey that Telkom needs to buy into the LLU approach and play ball. Also hopefully some offers will be put on the table.
 
All I saw was legal types... except for Angus Hay from neotel. Are the other operators too scared to send their CTOs???
 
Deep rural exchanges - interesting comments. Cell C guy says he will take it over and run a business. Vodacom says they want access to the facilities and backhaul but not the wireline access network... they will use "alternate last mile technologies".

The only ways deep rural access can work is either subsidisation via the USAAF or cross-subsidisation via a national average cost of a line. The latter makes it financially unviable for the deep rural customers.
 
MickeyD said:
All I saw was legal types... except for Angus Hay from neotel. Are the other operators too scared to send their CTOs???
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Well hopefully round 2 will involve having the CTOs around the table and setting up communication between engineers and technicians (and maybe even the lumberjacks involved in chopping down poles). It was good to see a more strategic orientated sort of response from Telkom though.
Mind you putting too many CTOs together might be dangerous ....
 
MickeyD said:
Deep rural exchanges - interesting comments. Cell C guy says he will take it over and run a business. Vodacom says they want access to the facilities and backhaul but not the wireline access network... they will use "alternate last mile technologies".

The only ways deep rural access can work is either subsidisation via the USAAF or cross-subsidisation via a national average cost of a line. The latter makes it financially unviable for the deep rural customers.
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Well my thinking is that the talk of putting out an entire exchange and the failure of the USALs could feature quite well in breaking the current deadlock in thinking. The big ISPs (in this batch of submission sets MWEB) have previously made mention of the taxpayer effectively stepping in on a deficit - with the service providers making the profit. On the other hand unbundling facilities and bundling some stranded assets to off load changes the game quite a bit -- especially if Telkom goes ahead with putting their copper assets into an SPV etc ...

Each of the iECNS guys has reason to want to take hold of a few exchange premises and this will accelerate as data volumes continue to grow exponentially -- even in very deep rural areas there is some demand (particularly tourism) for high value services. If Telkom can offload 100 "bad" exchanges then the drain those exchanges cause on Telkom's cost structures brings down the wholesale cost for a line across the country. Whoever wants to plug up the connection to schools and clinics in an area are going to need some infrastructure which they don't have. The principles of Ch8 of the ECA carrying through means that if a suitable licence holder (and class licence holders for a district municipal area can step in here as well in fact as wholesale operators there is a massive opportunity here) takes lease (or even outright purchases) from Telkom the exchange depending on SMP and whatnot could still be subject to facilities leasing on the ducts and so on - moreover a contractual basis can be created in a sale making certain areas an Independent Line Operations area where lines are run independently of Telkom. Businesses like property developers and commercial real estate owners at the moment are sitting cosy while Telkom carries all the risk and the reality is that the division is between no fixed line and causing Telkom a loss whereas a fair number of small towns will probably be in a situation where an ISP will be able to get on board enough business customers to run an exchange - Telkom being held down by its size and bureaucracy.

Two companies entirely not featuring was Broadband Infraco and Sentech which are publicly funded and have hitherto made a mosh of things. If ILOs are established under the class licence regime and existing players with a specific area business plan don't step in then move some of the risk to Infraco and Sentech - we can look at the broader irrationality of those companies later.
 
MickeyD said:
All I saw was legal types... except for Angus Hay from neotel. Are the other operators too scared to send their CTOs???
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The Telkom lady appears to be the acting Regulatory Affairs head from Canada?
 
yep and her LinkedIn profile suggests she is an accountant from Canada

I don't think Moose and Weed Land has the same regulatory framework as we do, but I was quite glad to hear what I heard from her
 
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