Unbundling: what industry wants from Icasa - TechCentral

Unbundling: what industry wants from Icasa

MWeb CEO Rudi Jansen

The Independent Communications Authority of South Africa (Icasa) will present a discussion document on local-loop unbundling (LLU) to the telecommunications industry on Wednesday morning. TechCentral rounded up the views of a few key industry leaders, asking them what they hope will come out of the document.

Most industry players polled aren’t hopeful unbundling, which will open Telkom’s “last mile” of copper cable infrastructure to competitors, will have a big impact and, surprisingly, most are opposed to price regulation. Sources close to Icasa say the authority has no plans to force price controls on Telkom as part of the unbundling process.

MWeb CEO Rudi Jansen says he has “been disappointed so often” that he’s “not holding out much hope” for tomorrow’s announcement by Icasa. He says he doesn’t like price controls, but that if controls were to be implemented that improve the situation for consumers and service providers he would be in favour. If such controls “perpetuate existing problems, then there’ll be no point” to them.

Vox Telecom group MD Doug Reed says his company is “not perturbed”, regardless of what Icasa announces, because even if unbundling goes ahead it will be “too little too late”. Reed says that no matter what comes out of the discussion document, Telkom will “retard the process” for as long as possible.

Wayne de Nobrega

He says he doesn’t want Icasa to regulate access prices for LLU because “you shouldn’t interfere with free enterprise” and “not regulating is the better option long term”. Telkom would find ways to sidestep price regulations were they to be implemented, he adds.

Reed says LLU is long overdue and deals with infrastructure that is increasingly antiquated. With the process set to take “another year or two to complete”, most companies will have “found workarounds by the time the process is finalised”.

Altech Technology Concepts CEO Wayne de Nobrega has a different view. He hopes price controls of some sort are implemented and that flexibility in what types of services providers are able to offer over the last mile are introduced.

“We want to know what kind of services we can deliver and how much they’ll cost from start to finish,” he says. “It’s not just a question of driving prices down, but it’s also about driving flexibility.”

Web Africa CEO Matthew Tagg says he has “mixed feelings” about whether price regulation is needed to stimulate competition. He says there needs to be a greater separation between Telkom wholesale and Telkom retail and that they shouldn’t just be separate business units but separate legal entities.

“We’re still being disenfranchised in terms of our ability to compete,” says Tagg. “[Telkom] bundles voice and DSL (digital subscriber lines) together, which is anticompetitive. Consumers should be able to take a ‘naked’ DSL line without paying the Telkom tax of a phone line too.”

In terms of pricing for access to copper, Tagg says if Telkom makes the case that the cost of maintaining the copper network means any further reductions would result in it having to operate at a deficit then the call-out fee for a technician should be increased and the rental fee decreased.

“Contractors are expensive, and a massive portion of the cost of maintaining the network. There hasn’t been a public document on the cost of maintaining the copper network alone — it’s always bundled with other figures,” says Tagg. He says this cost needs to be analysed and discussed. “We could then work out out a fair charge for access.”  — Craig Wilson, TechCentral

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