Telkom`s ADSL taken to ICASA again

Paul Vecchiatto
By Paul Vecchiatto, ITWeb Cape Town correspondent
Cape Town, 21 Oct 2005

Cape-based Internet service provider (ISP) DOTCO has petitioned the Independent Communications Authority of SA (ICASA) to stop Telkom from implementing its new ADSL pricing structure from 1 November.

DOTCO claims it was the first ISP in the country to offer unlimited ADSL bandwidth in February, which Telkom asked it to change to a maximum of 30GB in March. A Telkom spokesperson has denied that it has allowed any ISP to offer a 30GB service.

"It appears as if Telkom is intent on using this per-gigabyte-based billing model as an instrument to pass on a radical cost increase to its resellers while bypassing the regulatory approval procedures for increases," says Johan Ferreira, DOTCO MD.

Ferreira also complains that Telkom`s new pricing structure, which includes 'hard caps`, would prejudice ADSL resellers, while its own retail operation can continue to offer 'soft cap` services.

A hard cap is when a service is cut off immediately once the bandwidth limit is reached. A soft cap means that only international roaming is stopped once the limit is reached.

Telkom`s new pricing is based on per-gigabyte usage for those ISP wholesalers that do their own provisioning and authentication, as opposed to the current fixed amount for a "fixed cap" or an agreed maximum usage over a month.

Ferreira says the move effectively marginalises smaller, independent ISPs that have been promoting, marketing, selling and self-regulating or authenticating Telkom`s 30GB ADSL service.

"The new structure forces self-authenticating ISPs to 'hard cap` or strictly limit usage to clients."

He says Telkom has made no such assertion on its own resale operations, creating a significant advantage for the organisation and an incentive for end-users to switch to the Telkom Internet service or services provided by Telkom-authenticated service providers.

'No 30GB contracts`

Victor Strydom, Telkom product specialist for product development, says: "I categorically deny that we have ever signed a contract with any ISP to resell a 30GB ADSL service."

Strydom reports to Telkom executive for product development Steven White.

He says Telkom only offered two, three and four gigabyte options for resale, with the two and four options being unshaped hard cap services, while the 3GB service was optimised for Internet roaming and had a soft cap.

"On the 3GB service a user could use up to 30GB, before being stopped. That is how I think the ISPs packaged it," Strydom says.

He says the new pricing structure was designed to give ISPs a more flexible approach, with a number of prices and bandwidth options.

Ferreira says DOTCO has signed a contract with Telkom to resell a 30GB service; however, he cannot make it public at the moment because of non-disclosure clauses.

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