Ozymandias
Senior Member
- Joined
- May 4, 2005
- Messages
- 660
- Reaction score
- 0
Government moves to lower bandwith prices
Lloyd Gedye. M&G.
In a move to slash bandwidth prices, the government has instructed the communications regulator to nationalise the landing station for the undersea SAT-3 submarine cable and to declare it an essential facility.
At present, as SAT-3's largest investor, Telkom has monopoly rights on access to and pricing of international bandwidth on the undersea cable.
Telkom uses its stranglehold on the SAT-3 cable to keep international bandwidth prices at stratospheric levels.
The government wants Telkom competitors to be able to provide their own international bandwidth from January next year.
This may be effected either through nationalisation of theof the Electronic Communications Act to ensure that all individual electronic licences can self-provide their international traffic.
Internet service providers (ISP) who can self provide will be better able to compete with Telkom in the bandwidth wholesale and retail markets.
The Act was promulgated on June 19 2006 and therefore Icasa's D-day is January 19 2007.
Icasa councillor Zolisa Masiza confirmed that the regulator was working towards the January deadline, but said it is in negotiations with the communications department about implementation.
Masiza said Icasa would have to declare the SAT-3 landing station an essential facility, but it may not happen by January.
Prices in US$ per megabit per second per month facility or regulating its use so that competitors get to use it on a cost or cost-plus basis.
It appears that Telkom will not be resisting the move though executives have said that any government initiative on the facility could impact negatively on future Telkom investments.
The move to drive down international bandwidth prices follows calls from numerous stakeholders requesting the government and the regulator to intercede in the granting of landing rights for international bandwidth delivered to South Africa's shores via the SAT-3 undersea cable.
A recent price survey of African countries that use SAT-3 for their international bandwidth showed that Telkom is charging up to 800% more than other countries for a megabit per second per month. (See box.)
The consortium members that invested in SAT-3 are set to lose their national monopolies of international bandwidth on the cable as five-year exclusivity agreements expire in June next year.
The Department of Communications is indicating that it is not prepared to wait until June.
He said Icasa was looking into using facilities leasing at cost or an appropriate rate in order to deliver on the minister's mandate.
Regulators and policymakers from across the continent met late last month at a conference in Johannesburg to discuss the end of the SAT-3 exclusivity period. In a joint statement released at the end of the conference, they called for SAT-3 prices to be significantly reduced and ultimately to be aligned with cost. This would reduce the cost of doing business in South Africa and stimulate competition in the information, communication and technology sector.
Telkom said it was not able to comment as confidentiality clauses restricted it from doing so, but it did say that it was "anticipated that ISP's situated in South Africa will be able to buy international bandwidth from any South African operator that is internationally licensed".
Broadband costs 800% more in South Africa than in Senegal, according to a soon-to-be-published price survey of African satellite markets, even though they are delivered on the same cable.
The survey shows that Internet service providers (ISP) in Senegal buy one megabit per second (mbps) per month from the incumbent Sonatel for $1 316 while Telkom charges $11 000 for its equivalent.
This is despite the fact that in Senegal the incumbent has no competition as satellite is forbidden by current regulation. The East Africa Submarine (EASSy) cable, which is being laid down the east coast of Africa, is mooted to offer a one mbps per month service at a price of $1 500, less than a seventh of Telkom's current price. EASSys bandwidth will be sold on an open access model where everybody can purchase it at the same price, whether they are an investor or not.
In Ghana smaller customers can purchase an mbps at between $4 250 and $4 900 and larger customers can get rates of $3 000, while Malian ISPs who receive their bandwidth via Senegal are paying slightly less than $6 500.
Lloyd Gedye. M&G.
In a move to slash bandwidth prices, the government has instructed the communications regulator to nationalise the landing station for the undersea SAT-3 submarine cable and to declare it an essential facility.
At present, as SAT-3's largest investor, Telkom has monopoly rights on access to and pricing of international bandwidth on the undersea cable.
Telkom uses its stranglehold on the SAT-3 cable to keep international bandwidth prices at stratospheric levels.
The government wants Telkom competitors to be able to provide their own international bandwidth from January next year.
This may be effected either through nationalisation of theof the Electronic Communications Act to ensure that all individual electronic licences can self-provide their international traffic.
Internet service providers (ISP) who can self provide will be better able to compete with Telkom in the bandwidth wholesale and retail markets.
The Act was promulgated on June 19 2006 and therefore Icasa's D-day is January 19 2007.
Icasa councillor Zolisa Masiza confirmed that the regulator was working towards the January deadline, but said it is in negotiations with the communications department about implementation.
Masiza said Icasa would have to declare the SAT-3 landing station an essential facility, but it may not happen by January.
Prices in US$ per megabit per second per month facility or regulating its use so that competitors get to use it on a cost or cost-plus basis.
It appears that Telkom will not be resisting the move though executives have said that any government initiative on the facility could impact negatively on future Telkom investments.
The move to drive down international bandwidth prices follows calls from numerous stakeholders requesting the government and the regulator to intercede in the granting of landing rights for international bandwidth delivered to South Africa's shores via the SAT-3 undersea cable.
A recent price survey of African countries that use SAT-3 for their international bandwidth showed that Telkom is charging up to 800% more than other countries for a megabit per second per month. (See box.)
The consortium members that invested in SAT-3 are set to lose their national monopolies of international bandwidth on the cable as five-year exclusivity agreements expire in June next year.
The Department of Communications is indicating that it is not prepared to wait until June.
He said Icasa was looking into using facilities leasing at cost or an appropriate rate in order to deliver on the minister's mandate.
Regulators and policymakers from across the continent met late last month at a conference in Johannesburg to discuss the end of the SAT-3 exclusivity period. In a joint statement released at the end of the conference, they called for SAT-3 prices to be significantly reduced and ultimately to be aligned with cost. This would reduce the cost of doing business in South Africa and stimulate competition in the information, communication and technology sector.
Telkom said it was not able to comment as confidentiality clauses restricted it from doing so, but it did say that it was "anticipated that ISP's situated in South Africa will be able to buy international bandwidth from any South African operator that is internationally licensed".
Broadband costs 800% more in South Africa than in Senegal, according to a soon-to-be-published price survey of African satellite markets, even though they are delivered on the same cable.
The survey shows that Internet service providers (ISP) in Senegal buy one megabit per second (mbps) per month from the incumbent Sonatel for $1 316 while Telkom charges $11 000 for its equivalent.
This is despite the fact that in Senegal the incumbent has no competition as satellite is forbidden by current regulation. The East Africa Submarine (EASSy) cable, which is being laid down the east coast of Africa, is mooted to offer a one mbps per month service at a price of $1 500, less than a seventh of Telkom's current price. EASSys bandwidth will be sold on an open access model where everybody can purchase it at the same price, whether they are an investor or not.
In Ghana smaller customers can purchase an mbps at between $4 250 and $4 900 and larger customers can get rates of $3 000, while Malian ISPs who receive their bandwidth via Senegal are paying slightly less than $6 500.
