SAT3 under the spotlight
Speculation that SAT3 may be running into capacity issues in the near future is not dying down.
Sources informed MyBroadband that SAT3 is running out of capacity fast and that the cable’s fiber quality makes it difficult to implement the latest upgrade technologies.
Telkom however denies these rumors, pointing out that SAT-3 and SAFE were recently upgraded to 120 Gb/s and 90 Gb/s respectively and that further upgrades are technically viable.
“These cables constitute a complex network and the utilisation is continuously monitored and plans executed to avoid the occurrence of any bottle necks or capacity shortfall. The current capacity growth rate depicts that a next upgrade of these cables will be required during 2008/9,” Telkom said.
Some sources are however not questioning SAT3 capacity, but are rather asking whether Telkom may be intentionally limiting local capacity to serve its own agenda. Some experts feel that if capacity is not a problem as Telkom suggests, then why would there not be more of an abundance of international fiber bandwidth available to local ISPs.
Many people and companies are pinning their hopes on Neotel to break Telkom’s stranglehold on international fiber connectivity, but this may also not be as easy as expected.
Neotel and SAT3
Rumors further abound that Neotel may have difficulties providing full SAT3 circuits to their South African clients.
Telkom currently has exclusive SAT3 landing rights in South Africa, but communications minister Ivy Matsepe-Casaburri recently announced that these exclusivity agreements will be declared null-and-void in November 2007.
There is another Department of Communications policy directive which aims to declare the undersea cable landing stations essential facilities, something that will effectively enable a player like Neotel to carry all national and international bandwidth – using SAT3 – without having to deal with Telkom.
Some question marks however remain as to what exactly the SAT3 shareholder agreement stipulates, and there is speculation that VSNL’s shareholding in Neotel may not be enough to grant SA’s second national operator the rights to cut out Telkom completely.
Neotel said that a key element in their strategy is to leverage the position and global capabilities of VSNL, their strategic equity partner. “VSNL owns and operates multiple international submarine cables globally, which means it is also a significant shareholder in the SAT-3/SAFE submarine cable system,” Neotel pointed out.
Neotel could however not directly comment on whether they are experiencing problems to fully utilize SAT3 through their partnership with VSNL, saying that they are not currently in a position to divulge any further information.
Other options on the table
While full SAT3 access is Neotel’s fastest option to cut bandwidth costs and directly supply full-circuit international fiber connectivity to their clients, they are also exploring other avenues to achieve their bandwidth goals.
“In line with Neotel’s intention of making a real difference to the South African telecom customers and to the economy as a whole, we are pursuing multiple approaches to improving the international services available to South Africa,” Neotel said.
Neotel further said that the introduction of genuine competition for international access, either by the termination of exclusivity on landing station rights of existing cable systems, or by the creation of newer submarine cables in the region, will inevitably result in better pricing for the customer.
“The added advantage of competition for international access will be the increased up-take of international bandwidth services by enterprises, and of international content services by consumers. This will be a key cornerstone towards the maturity of the South African telecoms market.”
Neotel said that they will provide feedback on any developments pertaining to EASSy and SEACOM as and when they occur.
SEACOM – which is being designed with a nominal capacity of 1 280 Gb/s comprised of two fiber pairs expected to connect South Africa, Mozambique, Madagascar, Tanzania and Kenya to India and Europe – recently announced that they awarded the supply contract to Tyco Telecommunications.
It has also already started surveying the route along the eastern coast of Africa, and many experts believe that this system will be operational before the much touted EASSy.
Political wrangling is viewed by many as the main reason for the slow progress of EASSy and the result of these difficulties is that the launch deadline has already been pushed back a few times.
The officially planned operational date of EASSy is currently the first quarter of 2009 while SEACOM expects to launch services in the first half of 2009.
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