Is Neotel for real?
Neotel is seen by many as the telecom saviour in South Africa, the company that will make access to broadband more economically accessible! When I had the opportunity to interview Neotel’s MD, Ajay Pandey, in October 2006 he told me “A price war is not for us”
He also made another important observation. He said that telecommunication costs in South Africa are too high and could drop by as much as between 25 and 35%. He said that he found it interesting that prices started to drop even before Neotel opened its door on 31 August 2006. Competition simply has that effect!
So if Neotel is for real or not, they already have made a contribution by causing Telkom to make some reductions in the cost of ADSL.
He also told me that a new Telecom Company is not created in one day and it is seldom ready to offer all services from day one. It is a process from which a company evolves and grows. Today it is wholesale services, tomorrow enterprise service and then retail services.
“We are already doing something for retail customers but with a wholesale layer in between. It is a question whether the wholesalers are passing the benefits we offer to the end customer. However our direct interaction with the retail market is not very far off. We are planning for the first quarter of 2007.”
Remember that he made that statement in October 2006, so perhaps his crystal ball was a bit clouded!
It is now the beginning of the second quarter of 2008, some 16 months behind the expected introduction of Neotel’s wireless telephone service. Did Ajay Pandey spin me a yarn?
No I do not believe that. I think he just under estimated how difficult it is to enter the telecoms market in South Africa.
Oh yes! Neotel is for real. Some enterprise customers are happy with their service. Neotel has rolled extensive fibre as a backbone to their wireless service.
They have extensively invested in CDMA 2000 and from their strategic planning guru Dr Angus Hay I learned at the recent CDMA conference held in Cape Town that Neotel has an operating CDMA network with real customer piloting the new service.
He also showed some of the CPE (telephone instruments) which are on order for their imminent roll-out. Imminent? He did not want to define how they interpret imminent but I guess it means real soon! I believe they have backed the right technology!
After having said all this I am likely to be excluded from trying it out!
By the way for the uninitiated CDMA is the acronym for code division multiple access, a mobile digital radio technology where channels are defined with codes enabling many simultaneous transmitters on the same frequency channel, unlike TDMA (time division multiple access), used in GSM.
Since more phones can be served by fewer cell sites, CDMA-based standards have a significant economic advantage over TDMA- or FDMA-based standards.
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