The race to roll out fibre has reached full throttle in the South African market.
So says Dave Meintjes, CEO of hosted PBX provider Connection Telecom, who notes the 'land grab' in this space opens the market up for true competition.
"Connectivity providers are falling over themselves to cover as much ground as possible with increasingly high-capacity fibre access at aggressive prices and with minimal lead times," says Meintjes.
According to consultancy firm McKinsey, fibre broadband Internet access is widely acknowledged as a foundation for digitally-enabled prosperity, as it "creates the platforms upon which users experience the Internet, and entrepreneurs and businesses innovate".
The Broadband Commission, a joint body of Unesco and the International Telecommunication Union, found that for every 10% increase in broadband penetration, additional growth of 1.3% in the national GDP can be expected.
In SA, the government put in place SA Connect, the country's broadband policy and strategy, which was adopted by Cabinet in December 2013. SA Connect outlines broad and ambitious goals for connectivity in order to, among other things, promote the competitiveness of the South African economy. Goals include having access of at least 5Mbps for 50% of the population by 2016, and 90% by 2020.
Meintjes says traditional telcos and new fibre specialists alike are contesting this game of one-upmanship, with infrastructure deployments coming thick and fast.
Currently, he says, there are about 10 key players investing in fibre infrastructure, with just over 200 000km of fibre capacity deployed in SA - and growing. Telkom dominates, with more than 70% of the national fibre footprint under its control, but new market entrants have had a significant impact on reducing the price of Internet access, he adds.
In September, Internet Solutions unveiled fibre access ranging from R749 per month for 2Mbps to R8 700 for 100Mbps.
Later on in the month, Vodacom Business started rolling out fibre-to-the-business (FTTB), with the initial phase seeing broadband connectivity of up to 100Mbps coming to selected business parks in Gauteng, Cape Town and Durban.
Neotel also announced it would drop the price of its 2Mbps fibre service to R1 600 per month, down from over R3 000.
"For many years, the supply side of the market dominated prices and service offerings, and the demand side of the market had to accept what came their way. At the network level, this has meant paying for artificial scarcity created by suppliers; for example, Telkom withdrawing its highly profitable low-speed [sub-1Mbps] Diginet services from the wholesale market to minimise the impact this has had on the company's voice services."
He says with increased access to affordable fibre services, users can properly converge voice, video, Internet, private network and video-on-demand services on the same access network, and totally remove their reliance on old PSTN infrastructure.
"In a competitive landscape such as this, things can only get better. It will be fascinating to see what offers will come up next, how widespread it will become, and what enablement is likely to result. Not only is it good for South Africans' Internet experience, but it will contribute to improved economic growth," he concludes.
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