Several industry commentators have labelled the Independent Communications Authority of SA`s (ICASA`s) new ADSL regulations as "disappointing".
MyADSL founder and broadband activist Rudolph Muller says the market is "somewhat disappointed". The issues of pricing and international bandwidth cap are the "two most pressing issues to bring South African broadband in line with international standards," he says.
Pricing in SA is over 1 000% more expensive than in developed countries, Muller says, and the regulator has not addressed this. However, he is hopeful this will be "aggressively" addressed later in the year.
The industry was hopeful there would be a single pricing structure; however, the regulator has demarcated three pricing areas, which could result in Telkom structuring its prices to keep the status quo, he says.
"While Telkom shareholders will be happy, South African consumers, by implication, are not likely to be happy," says an analyst, speaking on condition of anonymity.
Calling the decision "a bit disappointing", he says while the market hoped ICASA would "stamp its authority on the sector", no one could be surprised that it did not. "ICASA is reluctant to take a hard line against dominant players in SA, both mobile and fixed."
The manifestation of a weak regulator was particularly disappointing in the face of president Thabo Mbeki`s repeated comments that the cost of doing business - and the cost of telecommunications - in SA needs to be brought down, he says.
"It`s disillusioning," says Greg Massel, chairman of the Internet Services Providers Association of SA. "Customers were looking for more decisive action from ICASA - and I don`t think this is what they were looking for."
Not all doom
However, Massel says there are plenty of positives in the regulations, such as the 30-day installation requirement and the definition of what constitutes broadband. "There is some fairly strong action in terms of service delivery and clarity on what people are getting - this should not be overlooked."
He says it might be difficult for Telkom to keep to the 30-day requirement, considering the long backlog of expectant ADSL customers and the recent industrial action suffered by the fixed-line operator.
Gary Hart, GM of marketing and products at MWeb Business, takes a generally positive approach. One of the major benefits of ICASA forcing Telkom and the second national operator to connect an ADSL customer within 30 days is more people will choose ADSL over wireless broadband alternatives, he says.
In the past, a person would have to wait 90 or sometimes even 120 days, he says, which caused lots of people to opt for wireless broadband offerings.
"This is also fantastic news for ISPs," says Hart, explaining that the customer can quickly be assured of their broadband connection and surrounding services from the ISP, and the service provider can begin to realise revenues from the customer earlier than before.
He describes section 3.4, which reads: "local bandwidth usage shall not be subject to the cap", as "an exciting prospect for our customers".
Muller also comments on the positive aspects of the regulations, such as unmetered local access. This, he says, is "very important" for local IT companies seeking to create virtual private networks over ADSL.
In addition, the regulator`s terms guaranteeing service, as well as service level agreements, are positive.
Telkom welcomed the regulations. Group executive of corporate communication Lulu Letlape states: "As a good corporate citizen, the company will always endeavour to conduct its business within the regulatory framework."
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