Seacom less than 5% used: Chief development officer

[znh]

The amount of players that are able to buy from from Seacom is too small.
MTN, Vodacom & Saix and IS is hardly going to start a price war. Who else buys from them?

Give small players the ability to enter the market and compete with the big guys head on.
Small ISPS/Fibre companies must be able to buy a sizable chunk for very cheap. As they grow charge them more in line with what the big boys pay.

Barrier to entry.

 

[system32]

Seacom less than 5% used

Seacom’s Suveer Ramdhani sheds light on how bottlenecked South Africa’s local networks are.

Thats 5% of "the cable is capable of carrying 5 Terabits per second of traffic"

the optics currently deployed on the cable support a maximum capacity of 300 Gigabits per second.
Of this, only 240Gbps is currently lit up.

240/300Gbps = 80%

The reason ISP's don't use more international capacity is because local IPC costs 4x more.
http://mybroadband.co.za/news/adsl/121778-telkom-adsl-ipc-price-cuts-expected.html

IPC is currently the biggest cost to deliver ADSL data – around four times the cost of international bandwidth – according to ISPs.

 

[MickeyD]

The reason ISP's don't use more international capacity is because local IPC costs 4x more.
http://mybroadband.co.za/news/adsl/121778-telkom-adsl-ipc-price-cuts-expected.html

If the ISPs take advantage of Telkom IPC offer of double for the price of an extra 15% then it will no longer be 4 times more.... it will be just just over double!

 

[MrGray]

The reason ISP's don't use more international capacity is because local IPC costs 4x more.

Which is quite absurd when you think about it.

 

[MickeyD]

Which is quite absurd when you think about it.

Why?

What's the cost of an undersea cable? Depreciated over what length of time? Annual maintenance costs on that single cable?

Compare that to the IPC network...

 

[Sapphiron]

Granted IPC would be more expensive, but the fibre providers are undercutting Telkom IPC rates by huge margins in areas with existing footprint.

 

[MickeyD]

Granted IPC would be more expensive, but the fibre providers are undercutting Telkom IPC rates by huge margins in areas with existing footprint.

True and in doing so they are incurring significant infrastructure costs, which they have to recoup at some stage in the future. You'll find in many of their business cases that they are planning to operate at a loss for a few years... and then hope that they achieve economies of scale to pull them in the black. If not, then price increases are on the cards!

 

[kianm]

I think the local loop is the main issue, followed by the ISPs and their shaping

 

[mak2000]

Pointless blaming the operators, its the fault of the regulator. The Regulators need to create a environment encouraging usage, if you leave it up to the operators they will only look to maximise the profits. If you look at successful countries their regulators drive competition and usage. Ours is toothless.

 

[Swa]

Pointless blaming the operators, its the fault of the regulator. The Regulators need to create a environment encouraging usage, if you leave it up to the operators they will only look to maximise the profits. If you look at successful countries their regulators drive competition and usage. Ours is toothless.

Depends. In the case on Telkom it's the fault of the regulator but then we can also ask why have the operators been complacent waiting for the regulator so long. There the regulatory regime is responsible for not allowing competition to go ahead unhindered. With Seacom the operators are entirely to blame though. It's run by a cartel which resells what they buy. With the other cable systems everyone has direct access to the operators.

 

[sparticus]

They say its not being utilised, but only a few ISP's use it.



Its like having 12 lane roads in a small town and wondering why only 2 lanes are being used.

And the local municipality puts on toll gates from the city centre to the highway charging you an arm and a leg due to "limited access".