Openserve killing ISP profits with IPC charges

Will Telkom in a couple of year's time blame the ISP's or Vumatel for another failure?
 
websquadza said:
The issue here is simply that in the turf war to win fibre subscribers, two giants emerged - the incumbent and a private company. Both fought on even terms and covered roughly equal numbers of houses. So far so good. Both landed up drawing a line at overbuilds - great, because no one wins there.
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The consumer wins. Because as you rightly point out, "one of these giants" are overcharging.
Nothing prevents a competitor from stepping in except putting forward the capital to kill that the incumbent that overcharges.
That is how it works in a free market.

They aren't doing anything uncompetitive.
The practice you highlight is very common in many countries.
Nothing is special about OpenServe in that regard.

If anything given the lack of overlap and how you try to argue that not being the problem is the root cause here.
 
Gnome said:
The consumer wins. Because as you rightly point out, "one of these giants" are overcharging.
Nothing prevents a competitor from stepping in except putting forward the capital to kill that the incumbent that overcharges.
That is how it works in a free market.
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This is exactly what happened in the last 5 years.... Competitors took the risk and capital to attack Telkom's incumbency.

But it's easy to forget why this forum started, and the reason for it's existence in the first place. It used to be called myadsl.co.za, and it was all about people venting their frustrations with Telkom having a stranglehold on the DSL market in South Africa. This has been ongoing since the early 2000's.

Gnome said:
They aren't doing anything uncompetitive.
The practice you highlight is very common in many countries.
Nothing is special about OpenServe in that regard.
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I would disagree. Telkom had the advantage for many years, even laid claim and fought in court to have them (SAIX) allowed to be the only entity allowed to provide IP service in South Africa. The local copper loop was under Telkom control from the mid 2000's as a free asset to use, and abuse, for the purposes of internet access.

Telkom has a history of being obstructive, monopolistic and anti-competitive. Telkom has abused and used anticompetitive practices for well over 2 decades. Google "VANSA" (now ISPA) and "Telkom" and read up about the many court cases there were.

OpenServe, whilst having a new name, is nothing special. It's still just part of "Telkom", which had a huge stranglehold and monopoly in the fixed line space in South Africa for decades. They still do, because they own the tar poles in everyone's back yard, and boat loads of wayleaves and infrastructure by default, all paid for by the taxpayer... Yet they still failed miserably in responding to the deployment of fibre once competition arrived.

It took ISP's nearly a decade to fight them (in court) to even allow ISP's to use the DSL network in the crippled and extortionate IPConnect format which still exists today in Fibre as well as DSL.

Telkom hasn't played by free market rules, for decades, and still doesn't. Several anticompetitive practices were pointed out by ISP's which paid a fortune to contest these practices in courts, and Telkom was fined several million rands, which they then contested again. I've always said that Telkom is the biggest legal firm with a telecoms division.

They sat on so much spectrum and other assets which were essentially given to them by default, but now the whining is starting. At one point, it was "illegal" for WiFi signals to cross a property boundary, because the law stated that Telkom was the only company allowed to carry signals across property boundaries. Telkom even sued several companies that did private microwave links accross a public road.

It's easy to forget these things, and think that Telkom is now just "another competitor". But that is certainly not the case considering the "leg up" they've had for decades.

Let's consider the facts.

1Gbps of ISP crossconnect to Vumatel = R6000 per month
1Gbps of ISP crossconnect to OpenServe = R135 000 per month.

And this is after nearly 10 years of decrease in IPConnect fees. I recall days when it used to be R700 per Mbps of crossconnect to Telkom, and international transit was R7000 per Mbps.

Telkom was certainly NOT instrumental in changing any of these costs, and they have done their level best to obstruct the growth of IP connectivity in South Africa.

And let's not forget that if it were not for the fact that Altech won against the then Minister of Communications (Ivy Matsepe-Cassaburi) back in 2008, that for ISP's and other people with capital, it would still have been illegal for anyone but Telkom or Liquid/Neotel to deploy national and local infrastructure.

A case which Telkom obviously vehemently defended as well. So... Yes, monopolistic and anticompetive much....
 
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No wonder our fibre prices are the most expensive in the world for the slow speeds
they offer. In Europe the slowest speed is 100mbps and far East their slowest is 200mbps
 
If Vumatel is that much cheaper for ISPs, then why are they only marginally cheaper for the end user when compared to Openserve?
 
Mampara said:
No wonder our fibre prices are the most expensive in the world for the slow speeds
they offer. In Europe the slowest speed is 100mbps and far East their slowest is 200mbps
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Not quite, I'm in the far east and you still get 16/35/60/100/300/500/1G/10G as options here.
It ranges from R150 to R600 for 16-1G fibre speeds a month for your line which includes unlimited data, and no separate ISP and fibre provider nonsense.
 
can the ISP's just stop offering packages on openserve?

Archie1 said:
If Vumatel is that much cheaper for ISPs, then why are they only marginally cheaper for the end user when compared to Openserve?
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can we have a 'massive' article around this nugget?
 
Archie1 said:
If Vumatel is that much cheaper for ISPs, then why are they only marginally cheaper for the end user when compared to Openserve?
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I suspect that they have to use the margin my get from Vumatel connections to cross subsidize the OpenServe connections. If OpenServe charged comparative access fees to Vumatel, customers would have been charged less overall. IMO.
 
Nod said:
Yes, but lose OpenServe customers in the process.
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I'm sure they will be really sad to be rid of the loss making customers. Not non-profit or break-even, but loss making, as they would still make use of customer services and needs to be notified of outages and sent bills etc.

Only metric where these customers account for anything then, is in terms of "number of customers served".
 
Openserve’s network is designed to connect Internet Service Providers (ISPs) to a national copper-based and fibre-based footprint across rural, urban and metropolitan areas.
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I am so sorry, but I don't understand this logic? I travel around this country constantly, and have yet to find a "rural" area that has DSL? And the few that did, no longer do, because of the decommissioning of copper, which they says is cable theft, but I drive around and see all the cables in place, right back to the makeshift container come exchange.

With copper being phased out, and customers being conned lured into 24 month LTE contracts, how can this statement even be justified. I know one community where this happened, and everyone who got an LTE contract was lumped with the news of the switch from MTN roaming to Vodacom roaming, and there were only MTN towers in that community. This was met with the canned response that the router will still work in neighbouring communities so they can't cancel the contracts.

Telkom OpenServe is also now focussing its efforts on high-density areas for fibre rollouts, and since IPC doesn't allow ISPs to offer services over the already congested LTE Network, this argument is invalid.

We are losing our DSL customers to the Telkom Uncapped LTE offering, which from what I have been told is unstable. Can't really comment as I haven't tried to use it. What I do know is, that I am having headaches with client's who are waking up to find their DSL "disconnected" and having no choice but Capped LTE, which works out a lot more expensive, and SINR margins of -12dBm. Average DL speed in some areas is 0.5mbps on a good day.

A police station in one area was left with no phones and no alternative. They were told to complete a form that they were emailed, and then fax it back. No phone = no DSL= no Email = no FAX. Complaints department on the 92nd floor. Use the stairs.
 
TheRoDent said:
They sat on so much spectrum and other assets which were essentially given to them by default, but now the whining is starting. At one point, it was "illegal" for WiFi signals to cross a property boundary, because the law stated that Telkom was the only company allowed to carry signals across property boundaries. Telkom even sued several companies that did private microwave links accross a public road.
Click to expand...

I remember reading something decades ago about Telkom losing a case because some clever lawyer argued that waving at someone across the street is essentially transmitting a signal using light which is part of the RF spectrum.
 
The Sadim touch is the opposite of the Midas touch. With the Midas touch, everything you touch turns to gold. With the Sadim touch, you ruin everything you touch.


:whistling:
 
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