Close Menu
TechCentralTechCentral

    Subscribe to the newsletter

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Facebook X (Twitter) YouTube LinkedIn
    WhatsApp Facebook X (Twitter) LinkedIn YouTube
    TechCentralTechCentral
    • News
      R99 grocery subscription war: Pick n Pay takes on Checkers

      R99 grocery subscription war: Pick n Pay takes on Checkers

      30 October 2026
      Icasa's fingerprint Sim plan runs into major telco resistance - Nomvuyiso Batyi, CEO of the Association of Comms & Technology

      Icasa’s fingerprint Sim plan runs into major telco resistance

      30 October 2026
      Binance hit by $6.3-billion hack, the biggest crypto heist ever

      Binance hit by $6.3-billion hack, the biggest crypto heist ever

      30 October 2026
      AI has started a tech 'supercycle', says Datatec's Jens Montanana

      AI has started a tech ‘supercycle’, says Datatec’s Jens Montanana

      29 October 2026
      Icasa wants your fingerprint before you can get a Sim card

      Icasa wants your fingerprint before you can get a Sim card

      29 October 2026
    • World
      Alleged Israeli spy company heavily targeted Starlink users

      How online ads were used to hunt Starlink users

      28 October 2026
      Anthropic's IPO stands alone

      Anthropic’s IPO stands alone

      23 October 2026
      PHP flaws trigger global scramble as hackers pounce

      PHP flaws trigger global scramble as hackers pounce

      22 October 2026
      OpenAI turns the tables on Apple in trade secrets fight

      OpenAI turns the tables on Apple in trade secrets fight

      15 October 2026
      Google's Gemini 4 Argon is finally here

      Google’s Gemini 4 Argon is finally here

      14 October 2026
    • In-depth
      Why investors are souring on Netflix

      Why investors are souring on Netflix

      22 October 2026

      10 days that changed the course of AI

      21 September 2026
      Meta to the AI industry: slow down without us - Mark Zuckerberg

      Meta to the AI industry: slow down without us

      16 September 2026
      Google DeepMind CEO Demis Hassabis. Image: John Sears

      The plan to stop AI from breaking the world

      16 July 2026
      The internet has a Strait of Hormuz problem

      The internet has a Strait of Hormuz problem

      15 July 2026
    • TCS
      TCS+ | Vox on AI, data rules and omnichannel communication for SMEs

      TCS+ | Vox on AI, data rules and omnichannel communication for SMEs

      26 October 2026
      TCS | The Cape Town firm quietly connecting Eskom, Pep and 6 000 ATMs - Réan van Niekerk, Metacom

      TCS | The Cape Town firm quietly connecting Eskom, Pep and 6 000 ATMs

      23 October 2026
      TCS+ | Boards are underestimating the cost of a cyberattack, says Arctic Wolf - Jason Oehley and Andre Den Hond

      TCS+ | Boards are underestimating the cost of a cyberattack, says Arctic Wolf

      22 October 2026
      W&W | LDV's Gerhard Moolman on electric bakkies, fleet orders and 'school fees'

      W&W | LDV’s Gerhard Moolman on electric bakkies and fleets

      9 October 2026
      TCS | Frogfoot sees bigger fibre deals coming - TechCentral Show guests Abraham van der Merwe and Shane Chorley

      TCS | Frogfoot sees bigger fibre deals coming

      8 October 2026
    • Opinion
      AI's boardroom honeymoon is over - Gary Stocks

      AI’s boardroom honeymoon is over

      22 October 2026
      Before South Africa licenses Starlink, it should look at Ukraine - Duncan McLeod

      Before South Africa licenses Starlink, it should look at Ukraine

      21 October 2026
      Nonkqubela Thathakahle Jordan-Dyani

      Why cybersecurity is now a national security issue for South Africa

      15 October 2026
      When a machine can choose, who does it become? Fanie van Rooyen

      When a machine can choose, who does it become?

      9 October 2026
      Let South Africans jailbreak their way to digital sovereignty - Dirk de Vos

      Let South Africans jailbreak their way to digital sovereignty

      5 October 2026
    • Company News
      • 1Stream
      • Africa Data Centres
      • AfriGIS
      • Altron Digital Business
      • Altron Document Solutions
      • Altron Group
      • Arctic Wolf
      • Ascent Technology
      • AvertITD
      • BBD
      • Braintree
      • CallMiner
      • CambriLearn
      • CM.com
      • Contactable
      • CYBER1 Solutions
      • Digicloud Africa
      • Digimune
      • Domains.co.za
      • ESET
      • Euphoria Telecom
      • HOSTAFRICA
      • Incredible Business
      • iONLINE
      • IQbusiness
      • Iris Network Systems
      • Kaspersky
      • LSD Open
      • Mitel
      • NEC XON
      • Netstar
      • Network Platforms
      • Next DLP
      • Ovations
      • Paracon
      • Paratus
      • Publishared
      • Q-KON
      • SevenC
      • SkyWire
      • Solid8 Technologies
      • Telit Cinterion
      • Telviva
      • Tenable
      • Vertiv
      • Videri Digital
      • Vodacom Business
      • Vox
      • Wipro
      • Workday
      • XLink
    • Sections
      • AI and machine learning
      • Banking
      • Broadcasting and media
      • Cloud services
      • Contact centres and CX
      • Cryptocurrencies
      • Education and skills
      • Electronics and hardware
      • Energy and sustainability
      • Enterprise software
      • Fintech and payments
      • HealthTech
      • Information security
      • Internet and connectivity
      • Internet of things
      • Investment
      • IT services
      • Lifestyle
      • Policy and regulation
      • Public sector
      • Retail and e-commerce
      • Satellite communications
      • Science
      • SMEs and start-ups
      • Social media
      • Talent and leadership
      • Telecoms
      • Watts & Wheels
    • Events
    • Advertise
    TechCentralTechCentral
    Home » In-depth » What unbundling means for service providers and consumers

    What unbundling means for service providers and consumers

    By Editor11 January 2011
    Twitter LinkedIn Facebook WhatsApp Email Telegram Copy Link
    Get breaking news on WhatsApp

    Drive around SA city streets and you’ll soon notice Telkom’s green and blue distribution cabinets, like the one pictured above near TechCentral’s offices in Johannesburg, writes Candice Jones.

    Soon distribution cabinets of various colours could be popping up next to Telkom’s street boxes, thanks to local-loop unbundling. And their arrival could herald a steep reduction in fixed-line broadband costs for consumers and businesses.

    Telkom’s distribution boxes, many of which now have fibre-optic cables running into them, are often the place where the company provides consumers with access to its digital subscriber lines, the broadband links over the copper cables that run into people’s homes.

    The Internet market has long been anxious to see the local loop, the so-called last mile of copper cables that connects consumers and small businesses to Telkom’s network, unbundled.

    This dream could be realised before the year is over, and rival operators and Internet service providers have to start thinking now about how they will gain access to this network to provide fixed-line broadband directly to consumers.

    Worldwide, local-loop unbundling has boosted competition among Internet providers, driving down prices and paving the way for new services.

    Greg Massel, CEO of alternative operator Switch Telecom, says one of the requirements is that Telkom allows competitors to “co-locate” telecommunications equipment in Telkom’s exchanges – and, closer to homes, in distribution cabinets — so they can gain direct access and provide onward connectivity over their own backhaul links.

    Getting the equipment into these facilities is a big exercise, even if Internet service providers only want to serve niche areas rather than offering broadband services nationally.

    “Costs will vary depending on the coverage area, the equipment used and the capacity deployed, but I think it’s safe to say the kind of investment required will limit the direct benefits of unbundling to larger service providers,” says Massel.

    But he says smaller service providers will have more options when looking for alternative wholesale suppliers, which may help drive down prices.

    For many local Internet providers, backhaul will be a key consideration. Web Africa CEO Matthew Tagg says getting fibre to Telkom’s facilities will be the biggest factor influencing how successful unbundling will be.

    However, Tagg says alternative fibre network suppliers like Dark Fibre Africa have begun providing backhaul links, which should help keep prices down.

    The process becomes complicated in areas where Telkom doesn’t provide broadband access over copper from its traditional telephone exchanges, but rather from the distribution cabinets along city streets.

    In recent years, Telkom has actively laid fibre closer to people’s homes, running into distribution cabinets, and shortening the distance between consumers and high-speed fibre backhaul. Shortening the local loop in this way has allowed Telkom to offer higher-speed broadband, up to 10Mbit/s in some areas that are served by Metro Ethernet technology.

    But it also means Internet service providers have to start thinking about deploying their equipment in those boxes, or even building their own, says Tagg. The problem is there isn’t much space in Telkom’s cabinets, so alternative providers will have to consider building their own cabinets nearby.

    There have been suggestions that Telkom could offer what is called “bit-stream unbundling”, where it provides all the equipment other service providers need to connect customers. In this scenario, service providers won’t need to provide their own facilities in the exchanges or build their own distribution cabinets.

    “The industry should have had bit-stream access from when Telkom first introduced digital subscriber lines,” says Tagg.

    MWeb CEO Rudi Jansen

    He says to propose bit-stream access as an alternative to full unbundling is “a big cop-out”. “It will do very little to drive competition or produce real change for customers.”

    Tagg says full unbundling has been “very successful in Commonwealth countries such as Australia and New Zealand”. Increases in speeds and broadband quality in those countries can be directly attributed to the increase in competition brought on by unbundling.

    “We are already playing catch-up with countries like Australia. By my estimation we about seven or eight years behind,” says Tagg.

    Though smaller operators are looking forward to unbundling, larger players are wary of committing themselves to exactly what will be needed to take advantage of the process.

    MWeb CEO Rudi Jansen says what will be required will depend to a large extent on what the regulator, the Independent Communications Authority of SA (Icasa), stipulates must be unbundled.

    The authority last week revealed, in an exclusive interview with TechCentral, that it hopes facilities-leasing regulations will be enough to force Telkom to provide competing operators access to the local loop.

    In terms of the Electronic Communications Act, the local loop is considered an “essential facility” since it is a key aspect of the telecoms environment and operators are now able to demand access from Telkom.

    However, Jansen says facilities leasing is only a portion of unbundling and will only take the process so far.

    “At the end of the day we are all in the hands of what Icasa decides and how much Telkom would like to open up and under what conditions it will allow us into their facilities,” he says.

    “We need naked digital subscriber lines, where telephone and broadband line rental is split and not a situation where one is conditional on the other,” Jansen says. “More exchanges need to be upgraded to be broadband-capable and investments need to be made in access speeds,” he says.

    Internet Solutions MD Derek Wilcocks

    However, he says Icasa is not entirely on the wrong track. “For now, I think the regulator must go for the easy wins that will give immediate benefits to all.”

    Internet Solutions MD Derek Wilcocks says the best bet for local-loop unbundling is for the country to impose on Telkom what UK regulator Ofcom imposed on Britain’s incumbent fixed-line operator, BT Group.

    BT spun off its local loop into a separate, independent company called Openreach, which manages, maintains upgrades and leases the local loop to competing operators, including BT itself, and does it in a way that is transparent to all market players.

    “Creating a wholesale, transparent spin-off would be the most practical short-term solution for getting things done,” says Wilcocks.

    However, he says Telkom is preparing new products that indicate it is taking unbundling seriously. “For example, it is offering aggregated capacity at the larger exchanges to competing providers, instead of charging for every circuit in that exchange.”

    Whether Internet service providers will gain access to the local loop this year remains unclear. However, most industry players are hoping Telkom will meet the November deadline set by communications minister Roy Padayachie.

    • Subscribe to our free daily newsletter
    • Follow us on Twitter or on Facebook
    Add TechCentral as a preferred source on GoogleFollow TechCentral on Google NewsGet breaking news on WhatsApp


    BT Group Derek Wilcocks Greg Massel Internet Solutions Matthew Tagg MWeb Openreach Roy Padayachie Rudi Jansen Switch Telecom Telkom Web Africa
    WhatsApp YouTube
    Share. Facebook Twitter LinkedIn WhatsApp Telegram Email Copy Link
    Previous ArticleGroupon acquires SA’s Twangoo
    Next Article Big Brother is subpoenaing you

    Related Posts

    Icasa's fingerprint Sim plan runs into major telco resistance - Nomvuyiso Batyi, CEO of the Association of Comms & Technology

    Icasa’s fingerprint Sim plan runs into major telco resistance

    30 October 2026

    Former Icasa chairman Paris Mashile has died

    26 October 2026
    Openserve, Huawei test fibre-ready state housing in KZN

    Openserve, Huawei test fibre-ready state housing in KZN

    23 October 2026
    Company News
    Paratus continues to reshape connectivity in Namibia

    Paratus continues to reshape connectivity in Namibia

    29 October 2026
    Rate hikes threaten a household recovery built on cheaper credit - John Gellatly

    Rate hikes threaten a household recovery built on cheaper credit

    29 October 2026
    Choosing the right AI path for banks and large enterprises - Matthew Barnard BBD

    Choosing the right AI path for banks and large enterprises

    29 October 2026
    Opinion
    AI's boardroom honeymoon is over - Gary Stocks

    AI’s boardroom honeymoon is over

    22 October 2026
    Before South Africa licenses Starlink, it should look at Ukraine - Duncan McLeod

    Before South Africa licenses Starlink, it should look at Ukraine

    21 October 2026
    Nonkqubela Thathakahle Jordan-Dyani

    Why cybersecurity is now a national security issue for South Africa

    15 October 2026

    Subscribe to Updates

    Get the best South African technology news and analysis delivered to your e-mail inbox every morning.

    Latest Posts
    R99 grocery subscription war: Pick n Pay takes on Checkers

    R99 grocery subscription war: Pick n Pay takes on Checkers

    30 October 2026
    Icasa's fingerprint Sim plan runs into major telco resistance - Nomvuyiso Batyi, CEO of the Association of Comms & Technology

    Icasa’s fingerprint Sim plan runs into major telco resistance

    30 October 2026
    Binance hit by $6.3-billion hack, the biggest crypto heist ever

    Binance hit by $6.3-billion hack, the biggest crypto heist ever

    30 October 2026
    AI has started a tech 'supercycle', says Datatec's Jens Montanana

    AI has started a tech ‘supercycle’, says Datatec’s Jens Montanana

    29 October 2026
    © 2009 - 2026 NewsCentral Media
    Built and maintained by Chronon
    • Cookie policy (ZA)
    • TechCentral – privacy and Popia

    Type above and press Enter to search. Press Esc to cancel.

    Manage consent

    TechCentral uses cookies to enhance its offerings. Consenting to these technologies allows us to serve you better. Not consenting or withdrawing consent may adversely affect certain features and functions of the website.

    Functional Always active
    The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
    Preferences
    The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
    Statistics
    The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
    Marketing
    The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
    • Manage options
    • Manage services
    • Manage {vendor_count} vendors
    • Read more about these purposes
    View preferences
    • {title}
    • {title}
    • {title}
    🇿🇦 Sign up to the TechCentral newsletter