Telkom SAT-3 monopoly nears end

By Damaria Senne, ITWeb senior journalist

Johannesburg, 15 Jan 2008

The Independent Communications Authority of SA (ICASA) has published draft regulations prescribing essential facilities, bringing fixed-line operator Telkom's monopoly in the SAT-3 international gateway near the end.

The European Commission defines an essential facility as "an infrastructure which is necessary for reaching customers and enabling competitors to carry on their business, but whose duplication by competitors is impossible, or extremely difficult, due to physical, geographical, legal or economic constraints".

Seacom's SAT-3 undersea cable is an example of such a facility over which Telkom held control. It is unclear when Telkom's exclusive hold over SAT-3 was to expire. Some market watchers said the contract was to expire last year in June, others suggested November as the deadline.

The regulations published by ICASA last month prescribe international gateways, cable-landing stations, backhaul circuits, earth stations and land-based fibre optic cables as essential facilities.

Co-location space, main distribution frames and undersea fibre optic cables have also been listed under essential facilities.

The regulations also call for fair and non-discriminatory access to these facilities, and for the party in control of access to negotiate in "good faith" with a person who requests access to the facility.

"The person in control of an essential facility must provide access to an essential facility pursuant to the same conditions and of the same quality as it provides itself, its subsidiaries, related parties or persons which possess a financial interest."

ICASA also calls for interested parties to submit written comments on the draft regulations by 11 February. No extensions will be granted, the regulator says.

Waiting almost over

South African telecoms operators have long called for the SAT-3 undersea cable to be declared an essential facility.

They said Telkom was not providing fair access and access charges were too high, amounting to as much as four times what international operators charged for access to the same facility.

The Communication Users Association of SA and the SA Value-Added Network Association (SAVA) also called for national backhaul circuits to be declared essential facilities, enabling competition and price drops in that space.

"The pricing anomaly [where national backhaul connectivity is more expensive than international connectivity] effectively nullifies any landing point liberalisation or new, ocean-based connectivity services, regardless of how fast or cost-effective they may be," said SAVA chairman Paulo Froes.

ICASA may hold oral hearings before finalising the essential facility regulations. Telkom was unable to comment on the issue by the time of publication.