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Time to slaughter the cow

WiMax technology is ideal for development in Africa, but it seems SA will lose out as long as government`s cash cows are alive.
By Warwick Ashford
Johannesburg, 17 Feb 2006

The recent certification by the WiMax Forum of fixed wireless equipment based on the WiMax standard has lifted the final hurdle to the implementation of the technology in most places, except SA.

We should be used to being left behind by now, but that does not make yet another instance of it any less irksome.

While neighbouring countries like Mozambique are free to go ahead with plans to implement a relatively inexpensive WiMax infrastructure that has the potential of delivering telephone, television and broadband Internet to remote areas, SA has yet another hurdle to clear.

Ostensibly, the reason we are set to lag the rest of the world in implementing WiMax is that the independent communications authority, ICASA, has yet to consider the best way of making use of the 3.5GHz (WiMax) spectrum, but I suspect the real, underlying reason is far more disturbing.

The real stumbling block to WiMax lies beyond ICASA, just as the real stumbling block to efficient and affordable ADSL Internet access lies beyond Telkom.

All local telcos will be unable to introduce commercial WiMax services until ICASA has made official WiMax spectrum allocations and issued licences to operate using the 3.5GHz frequency, with two notable exceptions.

Although no time frame has been set for WiMax spectrum allocations as ICASA continues to consider how best to divide up the 3.5GHz frequency band, two licences have already been awarded.

No prizes for guessing that the recipients of these two highly-prized licences are Telkom and Sentech, with six other applicants only cracking the nod for test licences.

Unfair advantage

Call it any way you like, but from where I am sitting, granting Telkom and Sentech licences in the 3.5GHz band is tantamount to handing these organisations a significant competitive-edge in being able to roll-out commercial WiMax services before anyone else.

Who would have the power to compromise the "independence" of ICASA and at the same time benefit from giving Telkom and Sentech an unmitigated unfair advantage?

Again, no prizes for guessing that government is almost certainly behind the whole ridiculous state of affairs, the question is: why would a government deliberately sabotage the country`s development by delaying the widespread roll-out of a WiMax infrastructure?

The answer to this question is probably the same as the answer to the question: why would a government deliberately prevent the introduction of efficient and affordable ADSL services?

I suspect the key to these and several other anomalies, is that the government is obviously not yet quite ready to sacrifice its cash cows on the altar of development.

Dereliction of duty

The real stumbling block to WiMax lies beyond ICASA, just as the real stumbling block to efficient and affordable ADSL Internet access lies beyond Telkom.

Warwick Ashford, portals managing editor

While paying lip service to the role of technology in achieving social upliftment through development, government is neglecting its duty to the electorate and abusing its power to ensure its revenue streams are protected, lifting its cash cows up to the status of holy cows.

Another good example of this would be finally granting a licence to a second national operator (SNO), albeit it four years behind schedule, and then making sure it will not be able to compete with Telkom any time soon by stopping short of local loop unbundling (LLU), effectively preventing the SNO from using any part of the Telkom network without paying for it.

According to technology advisor Nic Laschinger of consultancy company, The Next Big Thing, granting the SNO a licence without LLU renders it impotent as a competitor to Telkom. The delay in WiMax spectrum allocations will make doubly sure of that because Laschinger believes that providing a wireless infrastructure is probably the SNO`s best chance of winning any market share in the short-term.

Laschinger believes that only by approving LLU will government prove it is serious about the SNO because it is only countries where LLU has taken place that have been successful in promoting true and meaningful competition to former telecoms monopolies. There can be no real competition without LLU, he asserts.

It`s time

South Africans need to get real about the fact that when weighing cash cow revenue streams in the balance against what is best for the country as a whole in terms of development, the cash cows are likely to win as long as this practice continues to be unopposed.

Considering the benefits telecoms technology like WiMax could bring to this country, it is time someone had the guts to slaughter a holy cash cow or two for the benefit of all in the long-term.