Build your own Telkom
IRRESPECTIVE OF HOW MUCH fibre optic cable capacity the likes of Telkom, Neotel, MTN and Vodacom put into the ground, the final link to the homes of the public at large – called the last mile – will continue to dictate what electronic services they’re able to receive.
There are currently two options in providing broadband to residential properties: wireless connections (from cellular operators iBurst and Neotel) or wired connections from Telkom.
However, for a small group of gated communities, liberation from those services has already happened. A number of companies are working together with developers to wire new developments, effectively eliminating the need for any unit in the complex to apply for a Telkom line.
Put another way, one of the big losers will be Telkom, which will lose the strategic advantage of owning the last mile in some of its most lucrative residential markets. Once the complexes are wired up, it’s possible to deliver phone, television and security services via a single cable, avoiding the blight of hundreds of satellite dishes popping up around the estate.
Gerhard Loots, CEO of Atec Systems, says rolling out the last mile is the most expensive part of providing telecoms. By delivering services over a private network, the community effectively takes ownership of that part of the network, relegating the telcos to the provision of bandwidth.
Loots says that’s happened because Telkom has simply been unable to roll out new connections to large housing developments, leaving customers to resort to wireless Internet services to obtain connectivity.
Arthur Goldstuck, director of research house World Wide Worx, says linking consumers via fibre optic is the only way forward. “Neither copper nor wireless technologies have the capacity to deliver IPTV and video on demand services. You can’t wire a whole city like that but it’s possible for suburbs and communities to build their own networks.”
However, much of that hinges on the ability of value added network service providers (Vans) to self-provide infrastructure. While inside gated estates developers and occupants have the freedom to do whatever they like, in traditional suburbs residents would need to find a company with the legal right to provide telecoms infrastructure to offer such services.
With the ruling by the Pretoria High Court – which effectively allowed all holders of Vans licences to build their own infrastructure – that could be one of literally hundreds of current Vans licensees. But if the Minister of Communications successfully appeals the ruling, there will only be a limited number of companies with the right to offer such a service.
Although still in its infancy, Loots expects to connect around 60 000 users over the next three years, up from 2 500 currently.
Concurrently, both Vodacom and MultiChoice have entered the fray: Vodacom with the acquisition of a gated community division from Internet Solutions and (more recently) MultiChoice, with the acquisition of Smart Village.
Goldstuck predicts over the next 10 years this technology will be standard in all mid- to high-level developments and many suburbs will have deployed it.
Finweek
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