Change is coming
South African consumers have long paid the price of a telecoms environment controlled by Telkom, MTN and Vodacom. According to ECN CEO John Holdsworth the situation was aggravated and prolonged by the fact that Government was a major shareholder in many of the biggest operators.
"Government has influence over telecoms regulations while also being the largest shareholder of communications enterprises – excluding the additional interests through PIC," Holdsworth pointed out.
This situation is however changing, and changing fast. Apart from changes in ownership in companies like Neotel and Vodacom, licensing and regulatory developments are promising to bring major changes to the local telecoms market.
Holdsworth said that five developments in the South African telecommunications space are all happening at the same time: IP replacing traditional TDM services, the promulgation of the ECA and subsequent regulatory developments, fixed-to-mobile convergence, new undersea cables like SEACOM and EASSY to land soon and a consumer revolution taking place.
The result of all of these developments will be more competition, better services and lower prices. This will however not happen overnight, and Holdsworth warns that the war has not been won, but has merely started.
The ECN CEO says that consumers should not expect overnight results, and that the impact of developments like lower international bandwidth prices from SEACOM may only be felt long after the cable has landed. Holdsworth said that there are still many hurdles to overcome, including Telkom’s control over the national fixed line infrastructure and high interconnect rates dictated by Vodacom and MTN.
The ECA however addresses most of these issues, and Holdsworth is confident that the face of telecoms can be changed through proper regulations. These regulations may include carrier interconnect, facilities leasing, carrier pre-select, number portability, cost based pricing and local loop unbundling.
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