Defining a first-tier operator

"The Internet is the most powerful and pervasive platform on the planet. The Internet has replaced the functions of the telephone and the post office. The Internet has redefined commerce, and as the outpouring from four million Americans has demonstrated, the Internet is the ultimate vehicle for free expression," United States Federal Communications Commission Chairman Tom Wheeler said when the American government voted to enforce Net neutrality.

The US leads the world in broadband penetration, with 94 978 000 fixed-line subscribers and 318 781 000 wireless broadband connections as of June 2014, covering 87% of the population of the country. In contrast, South Africa has a 3.1% fixed-line penetration rate, with 33.3% of the South African population having Internet access, according to the South African Department of Communications' presentation to the Portfolio Committee on Communications in 2013.

"Unlike more developed countries like the US, South Africa still has a long way to go to enable the government's goal of 100% broadband connectivity by 2020. Similarly, while our infrastructure and networks are as technologically advanced as those anywhere else in the world, we have a much smaller number of service providers in this country," says EOH Network Solutions' Stuart Hardy.

He explains that while there are a multitude of smaller providers, there are currently only seven first-tier service providers locally, including Telkom and EOH Network Solutions. "Over the last 15 years, the definition of what constitutes a first-tier operator has not changed. However, due to regulatory and technology changes, the definition has evolved to include new infrastructures."

According to Hardy, an organisation that runs L2 or MPLS services by leveraging an upstream provider in the same country cannot be seen as an independent first-tier provider. The main reason is due to the provider not being in complete control of their network or the bandwidth they use on the network. "Therefore, a true first-tier provider should be purchasing services at an SDH (synchronous digital hierarchy)level, or laying their own Dark Fibre."

He adds to be considered a first-tier operator, service providers must fulfil a number of basic requirements.

Firstly, he says, a first-tier provider must operate a national core backbone. "The first consideration is the design, build and operation of a private core national network, without which no other services are possible. While this does not require a service provider to lay their own national fibre, it does require them to purchase at a level of SDH or Dark Fibre. This national core has to include no less than nodes in Johannesburg, Cape Town and Durban."

Second, the company must operate a national peering network. "A first tier provider will bilaterally peer with other first-tier providers in the market. This needs to be on a settlement-free basis. However, it is realistic to exclude Telkom from this equation due to their dismissal of any peering requests in the last 10 years, regardless of their merit."

In addition, only first-tier providers operate an international SDH network, or take delivery of an SDH service, where they terminate SDH services in a node in the UK or US, which is deployed and managed independently. Also, first-tier providers must operate a national voice interconnect network with other first-tier providers.

"A more recent introduction to this requirement has been voice delivery, whereby a first-tier operator needs to deliver its own voice minutes to other providers via voice interconnects. Similarly, as an evolution of the national core network, metro rings are essential for first-tier providers to build and deliver their services. While all providers - except Telkom - still leverage other last-mile suppliers, the majority of the last-mile backhaul is done on their own metro core," Hardy explains. "These recent additions are seen today as essential in deploying and operating a first-tier network."