| South
African telecommunications has got off to a grim start in
2005, with the realisation that it's now more expensive to
call local cellular phones than some international destinations.
In addition, Communications Minister Ivy Matsepe-Casaburri's
recent media statement that she never intended Value Added
Network Service (VANS) providers to provide their own infrastructures,
has again pushed back parts of the deregulation process, according
to the Communications Users Association of South Africa's
Ray Webber.
"South
African business and consumers took an early hit when Telkom's
2005 tariff came into effect on 1 January 2005," says
Webber. "What can only be described as absurd is that
calls to some international destinations (such as the UK,
US and Australia) are now less expensive than calls from Telkom
lines to local cellular phones. It's absolutely ridiculous,
particularly as the cost of these international calls are
still expensive when compared to international norms. For
once, Telkom is not completely to blame for the situation,
as ICASA and the cellular operators are also responsible.
The fixed to mobile interconnect tariffs are way out of line
and it is well known that cellular operators are making a
killing, at the expense of their users. Judging by the high
cost of South African cellular communications, it would appear
that there is nothing more than a thin veneer of competition
in the mobile sector," says Webber.
"It's
high time that CUASA and associated organisations started
placing considerable focus on cellular tariffs. We intend
to start chipping away at the Regulator in this regard, in
the hope that this will be in the interests of all South Africans,
reducing call costs over time. However, much work needs to
be done before South Africa will see internationally competitive
pricing structures. From a cellular perspective, there are
simply too many vested interests and having Telkom as a major
shareholder in Vodacom simply doesn't help," he continues.
"The
Minister's unexpected, yet welcome announcement in September
last year, to liberalise the telecommunications sector, did
some back-peddling with the now infamous media statement that
she never intended VANS players to provide their own infrastructure.
As soon as the Minister had made her announcements last year,
CUASA pointed out that much clarity was needed with regard
to various aspects of her statement. The Minister took four
months and waited barely 24 hours before technologies such
as Voice over Internet Protocol (VoIP) became legal, to even
attempt to clarify some of those issues. Although the Minister's
latest media contribution is again short on detail and long
on assumption, it is clear that she is siding with the incumbent
telecommunications operator and not with business or the average
South African," says Webber.
“Since
the Minister's first statements surrounding Voice over Internet
Protocol and VANS, it has generally been assumed that VANS
would be entitled to provide their own infrastructure. This
interpretation was also made by ICASA, in their media release
on 22 November last year. It would have effectively cut Telkom's
overpriced infrastructure out of at least some of the Voice
over Internet Protocol loop, and enable both business and
consumers to benefit from more competitive pricing structures
for voice and data communications. "Instead, South Africans
and VANS providers who had been gearing-up to supply more
effective technologies will once again need to rely on Telkom's
monopolistic infrastructure. Again, this will have a detrimental
affect on the competitiveness of South African business,"
says Webber.
“It
is not yet clear how the Minister's decision will impact on
the development of much needed foreign revenue and employment
opportunities of international call centre operations. South
Africa offers a productive workforce, time zone synchronisation
and language compatibility, which makes the country an ideal
destination for some international call centre operations.
"If legislative and regulatory bunglings and a protectionist
attitude from the Minister continue, it is unlikely that South
Africa will be able to provide the cost-effective infrastructure
which will make such businesses a reality for the thousands
who could stand to benefit from employment in this sector,"
says Webber.
"With
effective competition in the sector, South African telecommunications
and associated industries could provide massive opportunities
for all South Africans. We find it difficult to believe that
the South African government in general, and the Communications
Minister in particular, would still seek to artificially protect
the monopoly which is Telkom, to the detriment of the citizens
they are claiming to serve. It is indeed 2005, yet South Africans
still need to compete on an international scale with one hand
lashed tightly behind their backs by the rope that is Telkom.
What will it take for those in power to realise that effective
competition is the key to growth, development and employment.
We still have no SNO, it would appear that competition in
the cellular environment is nothing more than a farce and
it's now unlikely that VANS operators will be able to deliver
competitively because of protectionism," he says.
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