Unbundling the last mile will encourage innovation and competition, which will trim prices and increase access to broadband, says Neotel, SA's second national operator.
The operator was presenting during hearings at the Independent Communications Authority of SA, held this week to determine industry's views on how to best free the last mile.
Neotel CEO and MD Sunil Joshi said local loop unbundling (LLU) will contribute to the economy, because it will boost competition, which will result in lower prices and increased penetration. He added this will lead to more investment in the sector, which will aid job growth.
Joshi explained that Neotel has rolled out 6 750km of fibre and 400 base stations, but access to Telkom's 5.5 million copper lines would enable it to expand broadband penetration. Without LLU, SA's competition will slip backwards, he noted.
Neotel would have loved to bring in more offerings sooner, but requires access to the last mile at economically-feasible prices to expand its range and use of innovative technology, he said.
Job creation
Ryan Hawthorne, senior manager of economic regulation, said LLU will benefit small and medium companies, which account for half of Telkom's DSL base. He added that smaller companies account for 40% of SA's R290 billion gross domestic product, and provide 60% of the jobs in the country.
LLU will increase broadband penetration as it will spur on competition and innovation, which will trim prices, Hawthorne pointed out.
Neotel will have to hire more staff the closer it moves its network to Telkom's exchanges, said Hawthorne. Hundreds of thousands of job days will be created as millions will be invested in infrastructure.
In addition, LLU will not harm Telkom, because it can charge a decent wholesale rate, which will be the highest out of all 29 countries that have implemented unbundling, commented Hawthorne.
Unions at Telkom have argued that LLU will cause Telkom to lose revenue, which will cost at least 10 000 jobs.
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