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Broadband Bullfight Heats Up

By: Bronwen Roberts

Competition is (slowly) bringing down bandwidth costs in South Africa
Recently South African cyberspace was given an area code (O87), the country's first report on wireless broadband offerings was released and the cheapest asymmetric digital subscriber line (ADSL) connection was announced.

The suffix 087 was allocated for Voice over Internet Protocol (VoIP) numbers by the Independent Communications Authority of South Africa (Icasa), effectively allowing calls routed through the Internet to connect with the traditional tele-coms infrastructure.

It would allow users to dial a 087 number much like a cellphone number and connect to someone who also uses a VoIP system instead of Telkom or a cellular network. The call would be routed through a data system, but be answered using a normal telephone or computer, depending on how it is set up by the service provider.

However, like most other telecoms issues, it is already contentious, with one service provider, Storm, saying Telkom believes it is illegal for Storm to provide voice services and to interconnect with it. Telkom spokesperson Lulu Let-lape explains, "According to Section 14 of the Telecommunications Act, value-added network services (Vans) providers are not permitted to carry voice until the communications minister gazettes a change. According to Telkom, that hasn't changed, that Act still stands".

Ironically, the 087 number range was used for the notorious value-added lines 11 years ago which featured mostly sex chatlines. It is common knowledge that Telkom suffered huge losses when subscribers refused to pay or operators defrauded them by skipping payment.

"Telkom lost a lot of money in the past; could lose a lot of money in the future," says Storm's business development director David Gale. He went on to say that Internet service providers (ISP) and other telecoms providers could form their own interconnect arrangement, and added that the upcoming Convergence Bill would make a challenge to Telkom unnecessary.

There is an effort to lessen the cost of bringing bandwidth into the country even as more complaints emerge about the price of telecoms in South Africa.
Globally, the much-publicised purchase of Internet calling service Skype by eBay for about $4-billion was concluded; while BSkyB, the United Kingdom's largest pay-television group was revealed to be interested in entering the broadband market by acquiring ISP Easynet and offering so-called triple-play services, combining voice calls, broadband Internet access and paid-for television.

Meanwhile, M-Web, which is the largest consumer ISP, announced the lowest monthly ADSL package, but one has to use Telkom's entry level 192kps connection and M-Web's monthly fee, which is the same cost as a normal dial-up.

Broadband access and cost has grown into arguably the most contentious issue after Telkom's call prices and the need to allow access to the "local loop". This is the so-called 'last mile" that connects subscribers to the exchange. The largest portion of the monthly cost is a second rental fee Telkom charges for the ADSL line. Icasa slammed these fees as "exorbitant" after hearings earlier this year into the cost of Telkom's broadband access; following a complaint by the MyADSL.co.za website. The website has emerged as one of Telkom's greatest critics as it is a forum for broadband users, many of whom are disgruntled about the service that Telkom is offering.

While most criticism has been about the cost of doing business and how it retards the country's economic growth the NGO, Sangonet pointed out that it hindered development goals too.

"The high cost of access limits the use of the Internet as a civil society tool and stunts the growth of a culture to use technology as an information tool," Sangonet deputy director Fazila Farouk told ITWeb. She told the information technology website that the 'about' 100 000 civil-society organisations in South Africa - most of which are community based - could use the Internet as a tool for fund-raising, advocacy and working with other constituencies to share information and coordinate development priorities, but cannot do so effectively on dial-up.

Meanwhile, the first wireless broadband report, released by Johannesburg University's department of business information technology and the MyADSL website, found that Sentech's MyWireless was the best on offer. Comparing price, speed, reliability, and support through lab and user testing, the report was a comparative analysis of the wireless alternatives to Telkom's ADSL. MyWireless scored 87%; Vodacom's 3G came second with 81%; WBS's iBurst third with 80%; and MTN's 3G was last with 78%. Ironically, MyWireless has received the worst publicity and there have been complaints of bad service and poor speeds.

Author Bio
You've probably already heard that VoIP could cut a substantial chunk off your company's monthly telecoms bill, and that there is more than one provider that offers the service. Both these facts are true. Storm makes it so easy for you to implement VoIP that you'll barely realise it's happened until your vastly reduced phone bill arrives.

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