Telkom plans to split its business functions

Paul Hjul said:
to keep the technical staff necessary to maintain the line
to amortize the cost of installation over life (which is shortened due to theft)

etc ... etc ... etc ...

yes

especially as an imperfectly efficient operator
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I've heard that nonsensical argument before. Doesn't explain the line behind me that could be earning an income. ;)
 
Paul Hjul said:
by breaking the ECA ...
:whistle:

In seriousness I doubt Swa understands what a facility is nor what network asset are involved in a POTS service
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I understand what's involved. It's a matter of how it's defined.
 
Swa said:
I've heard that nonsensical argument before. Doesn't explain the line behind me that could be earning an income. ;)
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the argument only appears nonsensical to you because you aren't prepared to understand the economics involved

the income is generated off leveraging the facilities in a manner to offer a value service. That represents the revenue end.
Make more revenue than your costs - either internal or to somebody else ... - and you make a profit
 
Paul Hjul said:
the argument only appears nonsensical to you because you aren't prepared to understand the economics involved

the income is generated off leveraging the facilities in a manner to offer a value service. That represents the revenue end.
Make more revenue than your costs - either internal or to somebody else ... - and you make a profit
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I don't think you're prepared to understand economies of scale.
 
Swa said:
I don't think you're prepared to understand economies of scale.
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I have a full grasp of economies of scale, you appear to presume that the benefactor of economies of scale must afford those benefits to competitors

you are also confusing economies of scale with network effects ....
 
MickeyD said:
He's heading into your pet area of more POPs ....
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doubt he'll get there though ...
he'll first have to understand network effects, cost based accounting and the basics of facilities leasing
 
Paul Hjul said:
I have a full grasp of economies of scale, you appear to presume that the benefactor of economies of scale must afford those benefits to competitors

you are also confusing economies of scale with network effects ....
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Doesn't appear like that when you keep referring to the mythical access line deficit.
 
Swa said:
Doesn't appear like that when you keep referring to the mythical access line deficit.
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where have I referred to the "mythical access line deficit" I have critiqued calling anything a line access deficit because there is no such thing - there is a pricing mismatch between the facilities cost of line access and the charge imposed for raw line access by Telkom retail. This is recognized by the competition commission, successive costs accountants and ICASA.
 
Paul Hjul said:
where have I referred to the "mythical access line deficit" I have critiqued calling anything a line access deficit because there is no such thing - there is a pricing mismatch between the facilities cost of line access and the charge imposed for raw line access by Telkom retail. This is recognized by the competition commission, successive costs accountants and ICASA.
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...
Paul Hjul said:
the line rental price is realistically closer to R400
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That is Telkom's reasoning of the access line deficit no? Costs more for the line than what's charged?
 
Swa said:
...

That is Telkom's reasoning of the access line deficit no? Costs more for the line than what's charged?
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Telkom's claim is that there is a line access deficit that is inherent in the market. Moreover that this deficit is to be established by taking the TOTAL cost of the network divided by the number of customers. This is nonsense because it is a selected consequence of choosing as a retail operation to make the cost of access less than the cost of the access medium in order to enable the upselling of VASes (in particular voice minutes).

Provided that there is transparent pricing you can identify the wholesale access cost (ergo no deficit) and make that price available to all - including yourself - which represents non-discriminatory pricing.
 
Paul Hjul said:
Telkom's claim is that there is a line access deficit that is inherent in the market. Moreover that this deficit is to be established by taking the TOTAL cost of the network divided by the number of customers. This is nonsense because it is a selected consequence of choosing as a retail operation to make the cost of access less than the cost of the access medium in order to enable the upselling of VASes (in particular voice minutes).

Provided that there is transparent pricing you can identify the wholesale access cost (ergo no deficit) and make that price available to all - including yourself - which represents non-discriminatory pricing.
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That just sounds like a different way to say the same thing.
 
MickeyD said:
?
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Sorry missed this. If Telkom leases infrastructure and not services e.g. lines and cabinets then it's completely agnostic to Telkom what they're being used for. An isp can install their own DSLAMs or whatever is required to run a POTS service and the same amount would still be paid for the line and other infrastructure.
 
Swa said:
Sorry missed this. If Telkom leases infrastructure and not services e.g. lines and cabinets then it's completely agnostic to Telkom what they're being used for. An isp can install their own DSLAMs or whatever is required to run a POTS service and the same amount would still be paid for the line and other infrastructure.
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Okay... so the ISP/ONO will lease a POTS line from Telkom (last mile copper link to the subscriber). Let's say for R189/m.

Now the ISP/ONO builds its own DSLAMs, POP, and core network as they also don't want to use IPC.

How much will that cost and how will they recoup those costs?

PS. you have not added data costs yet...
 
MickeyD said:
Okay... so the ISP/ONO will lease a POTS line from Telkom (last mile copper link to the subscriber). Let's say for R189/m.

Now the ISP/ONO builds its own DSLAMs, POP, and core network as they also don't want to use IPC.

How much will that cost and how will they recoup those costs?

PS. you have not added data costs yet...
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don't forget the cabinet costs and electricity
- dealing with muni and eskom ...
 
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