Broadband Infraco has been accused of “cream-skimming” or “cherry-picking” by Telkom.
Telkom says the new state-owned enterprise is not sticking to its original mandate of providing connectivity to underprivileged areas.
On Monday, the Independent Communications Authority of SA (ICASA) conducted public hearings into the invitation to apply for a licence that was issued earlier this year to Broadband Infraco.
It received written responses from Telkom, Vodacom, the Internet Service Providers' Association, Internet Solutions and the Meraka Institute.
Almost all the responses questioned why Broadband Infraco had to receive both individual-electronic communications network services (I-ECNS) and individual-electronic communications services licences (ECS). The first licence allows it to build and operate a telecommunications network, and the second allows it to sell managed services over the network.
The only submission to ICASA with wholehearted support for Broadband Infraco was that of the Meraka Institute. It said its own mandate is to support initiatives like Broadband Infraco whenever possible. It also said the network being laid by Broadband Infraco is essential for the roll-out of the multimillion-rand SA National Research Network, also known as Sanren.
Original intention
Broadband Infraco was originally conceived as a Department of Public Enterprises initiative to break Telkom's stranglehold on national long-distance telecommunications traffic, which was identified by the department as a key obstacle in reducing connectivity costs.
Broadband Infraco was originally mandated to build a network using fibre-optic links that have already been laid by Esitel and Transtel, and which have subsequently been transferred to it. The network is supposed to carry traffic from other companies and providers that will supply the managed services.
However, in its own submissions, Broadband Infraco says it needs the I-ECNS licence to provide services to large companies and government organisations. This has raised the ire of the commercial operators.
Telkom's submission, which was written by its head of regulatory affairs, Andrew Barendse, says that, while Broadband Infraco has stated it will not be a player in the retail market, its role is not clearly defined. He notes that in another part of Broadband Infraco's application, it says it will supply services to large corporates, enterprises and government customers.
Special conditions
“Since such customers are unlikely to be communications services licensees, we can only assume these customers will be customers of Infraco's ECS part of the business. The statement that Infraco will not be an access provider does not seem accurate,” Barendse writes.
He adds it is likely Broadband Infraco's selection of customers is contradictory to its mandate of expanding the availability and affordability of access to electronic communications to underdeveloped rural areas.
Internet Solutions said in its submission that it supports the granting of an I-ECNS licence with some special conditions, such as technology neutrality, to encourage a “price war” and expand communications. However, it opposes the granting of an ECS licence.
“If one of the special conditions attached to the Infraco licence is that Infraco should operate as a carrier of carriers, this will strategically position Infraco as a wholesale provider of infrastructure-based services. This will also serve to prohibit Infraco from providing infrastructure services directly to enterprise customers and they will be limited to providing services only to licensed operators who hold either an ECS or ECNS licence,” Internet Solutions said in its submission.
ICASA has yet to decide if further public participation will be needed.
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