SEACOM planning to offer IP transit/Internet services

SEACOM has already had a significant impact on the South African telecommunications and broadband market by brining competition to SAT-3/SAFE, and is now looking at going directly to the market with its own IP transit offerings through a partnership with Broadband Infraco and Teraco.

To date companies could only purchase IPLC (international private leased circuit) services on the SEACOM cable, and if they were looking at full IP/Internet access they had to either organise it themselves or purchase it from a service provider such as Neotel or Internet Solutions.

SEACOM is however looking at changing this scenario by offering IP transit services (hence full Internet access) directly to the South African wholesale telecoms market. SEACOM would therefore compete directly against companies like Telkom, Neotel and Internet Solutions in the international transit market.

It is understood that SEACOM will use Broadband Infraco to carry traffic from the Mtunzini landing station to Johannesburg. They have partnered with the vendor-neutral Teraco for data centre space from where the bandwidth will be distributed.

The Teraco based SEACOM Point of Presence (POP) may also alleviate some of the concerns about Neotel’s high cross connect and bandwidth charges.

According to one source, Neotel charges a cross connect fee around R11,000 per cross connect cable as well as almost R18,000 per month for an STM-1 worth of bandwidth capacity. Teraco’s cross connect charges, in comparison, ranges between R200 and R800.

Teraco MD Lex van Wyk explains that you essentially only pay for the fibre or copper which will be used to connect the two service providers (racks), and that there will not be any bandwidth charges associated with this ‘cross connection.’

Broadband Infraco joins in

Broadband Infraco recently confirmed that they have established a Point of Presence (POP) at Mtunzini, and is currently trialing services with a large mobile operator, from Mtunzini to Johannesburg.

Neotel has been using Broadband Infraco for backhaul capacity from Mtunzini to Midrand since 2009, so the company is well positioned to serve SEACOM’s backhaul needs to Johannesburg.

“The establishment of the POP at Mtunzini allows us to interconnect with the undersea cable systems that land there [(SEACOM, EASSy and SAFE)] and provide backhaul services to Johannesburg at either the Teraco Datacentre in Isando, the Business Connexion Datacentre in Midrand or the Neotel Datacentre in Midrand,” said Broadband Infraco’s Thamie Mthembu.

SEACOM planning to launch IP transit services

At the recent African Peering and Interconnection Forum organized by the Internet Society SEACOM’s Jean-Pierre de Leu said that SEACOM is set to start offering IP transit soon.

De Lue said that current pricing will be reviewed, and that they are planning to significantly reduce prices with their new offerings. De Lue pointed out that SEACOM does not rely on other cable systems to reach Europe from East Africa, which means that they are in a good position to bring aggressively priced IP transit pricing to the market.

De Lue highlighted that terrestrial backhaul pricing is high when compared to the international portion, and this is why SEACOM is looking at new opportunities to bring bandwidth to customers.

SEACOM would however not officially confirm its plans to offer Internet/IP access to local telecoms players in South Africa, but did give a strong indication that it is exploring this option.

“SEACOM is exploring a number of strategic options to further entrench itself as a key market player and participant in the expansion of affordable connectivity in South Africa,” said SEACOM spokesperson Frederic Cornet.

“Whilst we are not in a position to provide further details on the initiatives currently under development at this point, we are expecting to make an announcement before the end of the year.”

According to market speculation SEACOM is planning to launch their IP transit services towards the end of November. If this information is correct it is likely to be close to the launch of Broadband Infraco which is also set for a November launch.

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SEACOM planning to offer IP transit/Internet services