Thebumpy road to open-access mobile networks

um Neotel - owned by Vodacom, operated as a going concern

It is very very simple, the legislative framework is already in place and if Vodacom don't want to follow the ECA and the spectrum regulations then they shouldn't be allowed to simply take control of spectrum by way of some special dispensation. If the regulations (which prohibit the authority from allowing a spectrum transfer that results in less competition) on spectrum licensing are adhered to the natural conclusion is for Neotel to become a powered by Vodacom LTE network and then the case for wholesale access - at Vodacom set pricing - is made.
 
Paul, I like some of your insights here. Much of the cost of LTE networks is the fiber back haul. If that could be arranged on an open access basis as part of the licensing regime and not just the last mile, then the regulator would be in a position to advance broadband penetration across all current channels far more effectively than just looking at LTE.
 
Timber_MG said:
Paul, I like some of your insights here. Much of the cost of LTE networks is the fiber back haul. If that could be arranged on an open access basis as part of the licensing regime and not just the last mile, then the regulator would be in a position to advance broadband penetration across all current channels far more effectively than just looking at LTE.
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Thanks,

My general argument in almost all of these things is that we simply need to have a proper Rule of Law approach to the regulatory framework. An ECN licence (class or individual) carries with it certain structures of behaviour - mandatory facilities leasing, the privilege of digging up roads, access to spectrum - and working from the first principles found in the ECA ECNOs need to conduct their affairs in their best interests and make the necessary commercial arrangements that flow. There was a major disconnect with the Broadband Infraco saga and Sentech has been a bottomless pit of nonsense.

Spectrum is a spes and not property - the argument to make spectrum property is a separate debate - and it should be treated according to the regulations as they find themselves. A heck of a lot of the regulatory framework and so forth coming from ICASA has historically not been inherently awful and often contains some fairly sound principles as starting positions - the problem is that our market is so badly politically abused and regulatory capture is so deeply ingrained into structures
Paradoxically I think many of the sound principles have made their way into the framework by virtue of each of the players seeking regulatory capture finding an idea or principle which they think will be a big stick or shield for their business (technology medium neutrality for example) without understanding or accepting the full ramifications.

The reality is that Neotel as a going concern of Vodacom is in the long term good for Vodacom (and the industry)- what it won't do is deliver results in the performance metrics which is used to give big executive pay and this is why it isn't being viewed as Plan A.

The reality is that Solidarity actually needs to be honest with their members and say that if Solidarity supported LLU on a facilities leasing basis back in 2011 and it was implemented the job shedding would not be as severe - thus far all that the union has moved on is away from opposition in 2011 to "neutral" in 2013. LLU is in the long term good for Telkom and every day that it doesn't happen more jobs in the sector are put at risk. However we are instead seeing the creation of more opportunities for regulatory capture and corruption with the new ministry and these massive investment demands from Infraco - and silly threats from MTN.

The reality is that MTN were manifestly idiotic in their litigation approach on CTR and Vodacom silly to follow suit. The entire handling of the issue by executives in the sector was an embarrassment and a clear indicator of a lack of confidence in the ICT future of SA. The sad thing is we are two months away from the full weight of round 2 in this little tiff and no evidence of common sense coming to the fore has come from any quarter - if anything the indications coming from CellC is that round 2 will be on steroids.

If Vodacom (Neotel wholesale operations) and Telkom have wholesale LTE and fibre operations and Infraco and DFA have wholesale fibre and Sentech wholesale LTE the future starts to look very bright.
 
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So you say there are existing regulations that provide for facilities leasing on an open access basis? I'd love to know what MTN/Vodacom would charge for open access type leasing of their LTE back haul network, though I highly doubt that they'd implement meet-me facilities widely (on a L2 basis for example).
 
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Timber_MG said:
So you say there are existing regulations that provide for facilities leasing on an open access basis? I'd love to know what MTN/Vodacom would charge for open access type leasing of their LTE back haul network, though I highly doubt that they'd implement meet-me facilities widely (on a L2 basis for example).
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With respect to wireless links themselves, no, there isn't a requirement for facilities leasing - and there can't be. The remark that BAUT A will unbundle the wireless local loop when somebody shows it to them is incredibly valid and true. You are dealing with a service and not a facility, BUT even with respect to services providers making services available on a wholesale basis cannot act indiscriminately so once you've created a pricing model for an LTE wholesale product that model must be available for any applicable licence holder (I would submit that an i-ECNO could legitimately require access only by i-ECNOs especially if the open access LTE RAN still needs to be routed on a broader network). My primary interest in this is how the Neotel acquisition goes forth - as matters presently stand for the spectrum to be transferred there will have to be a public participation phase and Vodacom cannot expect any support from anybody with an interest in a proper industry and I highly doubt ICASA will prepared to witness litigation on the subject - which really means that Vodacom need to think of the Neotel acquisition on a broader strategy than simply acquiring dibs on spectrum to absorb into a closed network. Moreover the moment you are thinking in a L2 basis facilities arent being used but rather networks.

The mast and so forth on the other hand are facilities and must be open to sharing (as a slight tangent they are also places where people must not be permitted to strap testicles to transmitting equipment). When you have a common point of fibre provisioning at a mast point planned by one provider, in the absence of service level co-operation nothing precludes another provider from falling back to facilities leasing to install their own LTE RAN equipment on the leased facility. This feature changes the entire discourse and leads to an overwhelming case for co-operative commercial arrangements and

The CCC has already ruled in effect that the copper last mile must be unbundled. Unfortunately Telkom wasn't fined at the time, thanks to ICASA at the time being in the process of setting forth a programme for LLU. Since then every single South African has been shafted by ICASA (or whoever actually) accepting the rent seeking interests of certain operators (and in this instance not Telkom) and the web hasn't been freed and instead we will see further delays (LLU has been throttled to 64 bps while ICASA is asked to digest the New Zealand regulatory interventions) and an invitation for greater regulatory intervention and market reviews is on the cards. Unfortunately it seems ISPA is more interested in preventing Telkom from lowering costs to consumers out of tandem with profits than they are in seeing LLU and have yet to follow up on Neotel's victory.

Provide me with an iECN licence, the same capital injection that CellC got handed to it in extending their senior debt and the requisite legal department and an efficient ICASA with the CCC working optimally and no fear of the minister stepping in to undermine the exercise an I'll roll out a beautiful cherry picking LTE network on Vodacom, MTN and Telkom towers using such physical facilities as needed to connect my RAN equipment at as low a base cost as possible. Such an approach would be positively predatory but it represents the parasitic position that can be adopted in the absence of a growing cooperative industry. This hypothetical predator is overcomes by providers actually implementing facilities leasing and network sharing on a commercial basis.

Sadly while there was a very decent workshop by ICASA earlier this year on the subject - listen to what comes out from Telkom - the process has ground to a complete and utter destruction point. Naturally the best remarks are made right before the closing ;)
 
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