We are not the 'second national operator', says Neotel

Many consumers feel that Neotel has failed in their ‘duty’ to take on Telkom and provide South Africans with a true alternative to Telkom in the broadband and telecoms market.

As South Africa’s ‘Second National Operator’ (SNO) many consumers pinned their hopes on Neotel to roll out fixed line broadband services and force Telkom to react in an aggressive manner. This did not happen.

Neotel has in fact had very little impact on Telkom in the consumer market, and Telkom has not even once considered cutting their ADSL rates since the launch of Neotel’s NeoConnect offerings.

We are not the ‘SNO’

Neotel CTO Angus Hay said that there has been a misconception in the market that Neotel would be a ‘second national operator’ – aka a ‘Telkom 2’.

Hay said that at launch Neotel made it clear that they are not the second national operator, but rather the country’s first converged telecoms company.

Despite the fact that they did not compete head-on with Telkom on all their services, Hay said that it is unfair to say that Neotel did not have a positive impact on the local telecommunications market.

According to Hay their direct involvement in undersea cable systems like SEACOM, EASSy and WACS brought more competition to the international bandwidth market and significantly drove down prices.

Neotel can further be credited with facilitating the plunge in national long distance backhaul prices (which fell 60% to 70% since Neotel launched), said Hay.

Hay added that while access – most notably in the ADSL market (hence the fixed line residential and SME broadband market) – remains a challenge in South Africa, they are currently offering South Africans a real alternative to Telkom’s fixed line voice service with their R99 home phone service.

So while Neotel is often blamed for a lack of true competition in the broadband and fixed line arena, Hay urged consumers to look at the bigger picture and keep in mind what the company has achieved over the last few years.

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