The changing dynamics in the connectivity market are reflective of the turbulent time in which we are living. Quantum leaps are being made - not just in terms of technology, but more importantly, in terms of the way technology is being used.
Indeed, the whole technology argument is relatively meaningless (I like to call it alphabet soup - the number of acronyms is staggering). The point is that getting stuck on any one technology is not a good idea in a market as dynamic and volatile as the connectivity one - rather the industry should be occupying itself with standards and their applicability.
Back to ADSL. The reasons for the changes to the model, as with many things, cannot be tied to a single factor. Sure Telkom is trying to protect equipment that is `legacy` such as ISDN, but it goes deeper than that. In fact, the issue of legacy has several different aspects to it. Copper is quickly becoming a legacy technology as the concept of fixed mobile convergence is increasingly being translated into a reality.
Many of the new technologies that are entering the market are wireless. Nobody needs any length of time to understand the benefits of wireless technology - they are quite apparent.
There are still challenges to overcome with the inexorable progress to the 4G network.
Andy Brauer, CTO at Business Connexion.
All that is happening is that as technologies based on standards such as WiMax and OFDM enter the market, Telkom has to prepare the market for an alternative form of last mile signal distribution. ADSL is a form of last mile signal distribution, but it is tied to copper. Expensive, easily stolen or otherwise interrupted, ADSL is prone to the problems inherent in copper wireline technologies.
Phasing copper out is a good idea given these issues. Part of the effort to phase out copper can be seen in the changes that have been made to the pricing models - it is not the end of the world by any means, but rather a stepping-stone to better things for consumers - both business and home users.
Copper also has no role to play in the 4G world towards which we are rapidly progressing. 4G will deliver ubiquitous connectivity, across a wide range of the `alphabet soup` of standards - including WiMax, WiFi, Bluetooth and many more. These networks will deliver very high connectivity speeds of up to 100Mbps and more, and will effectively serve as a re-configurable integrator of the many standards for data transmission.
There are still challenges to overcome with the inexorable progress to the 4G network, including roaming from an access network to any other access network (2G, 3G, 4G, WiFi, WiMax, Bluetooth, satellite, Ethernet), and the need for standard handover interfaces to ensure interoperability among different vendors` equipment. Enabling ubiquitous access will also depend on quality of service guarantees during handover to ensure no disruption to user traffic.
If one steps back and looks at the successful models that have been applied by telecoms operators in mature, deregulated markets, it is obvious that new forms of revenue models are contributing substantial sums to income. British Telecom, for example, generates 30% of its revenue from `new` activities such as wireless connectivity. That, ostensibly, is the model that Telkom is seeking to create locally in order to perpetuate its success in a market that is rapidly changing.
Telkom`s move points to another current that is apparent in the industry, something I call the `merry-go-round`: the various operators active in the market are looking to expand their offerings into areas where they are not traditionally focused; Telkom into mobile, cellular operators into Internet connectivity, Internet service providers into voice offerings, and so on.
The effects of this merry-go-round ultimately will benefit the consumer - the more options we have, the better the opportunity we have for affordable and competitive services.
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