I've just returned from the ITWeb HP OpenCall Executive Forum, in which the tech giant punted its suite of solutions for telcos, ISPs, call centres and others who wish to take advantage of convergence between voice, video and data in the services they sell to customers.
In a video interview afterwards (we do convergence!) ITWeb's Candice Jones asked an interesting question. I had described how I don't believe our cellular companies in particular, and telcos in general, would easily buy into this technology. Her question was, "Does HP not understand the South African market?"
This had me briefly flustered. That wasn't what I'd meant to say, but it was a valid question, and made me think.
It isn't that HP doesn't understand the South African market. In fact, it has more reason than most vendors to understand it, having been a founding member of the Presidential International Advisory Commission on the Information Society and Development. It used South Africa (Mogalakwena, in the Limpopo province, to be precise) as a basis for one of only two i-Community test-beds in the world (the other being in Andra Pradesh, India).
So why is it that attendees appeared skeptical of the vision of a converged services future it had outlined that morning?
A range of practical applications were demonstrated, such as video calling, the ability to flight advertisements while customers make calls or retrieve voice mail, and integration with blogging or social networking functionality. Each offered not only something users probably want, but revenue opportunities for operators and content providers.
They [SA telcos] have no need to cannibalise their own revenue streams, because nobody will eat their lunch if they don't.
Ivo Vegter is a freelance journalist and columnist.
Besides the traditional problem in the mobile market of having to support a million and one different end-user devices, much of the criticism said that HP didn't understand how our telcos operate. XHead = Way behind the curve I'd say it's not so much HP's fault, as a legacy of our telecoms policy. In China, India and Western Europe, the biggest adopters of such converged services, there is much competition between telcos. Broadband is a commodity. You get a trillion all-you-can-eat megabits for the price of a beer, over there, and everyone has an HP gigaswitch next to their circuit breaker board in the kitchen.
Traditional sources of revenue - voice in particular - are being undermined by all this IP stuff, so telcos are increasingly searching for differentiated services, involving music or other content, as well as advertising, to build new revenue streams.
Telcos in South Africa have no such problem. They have no need to cannibalise their own revenue streams, because nobody will eat their lunch if they don't. They're still focusing on selling little bits of capped, throttled and shaped bandwidth, for exorbitant prices. While bandwidth appears to finally be on the verge of becoming a little more abundant, our telcos are way behind the curve that HP's convergence vision describes.
Cell C has proven conservative in undermining established competition. Interconnection agreements with the big boys have it by the proverbial short and curlies. Neotel is but a babe in arms. It may prove to be more aggressive, but until I see it, I wouldn't bet on it. Vodacom and MTN are in many respects a cosy cartel, living on voice minutes and the premium-SMS bonanza, intent only on stealing the cream off some of Telkom's data revenue. And Telkom, well, who knows what Telkom wants? MultiChoice lacks a return connection from customers that would make its content interactive. Telkom Media has connections in neither direction, nor the capital to establish them.
Thanks to the legacy of restrictive licencing and severely limited competition that Andile Ngcaba and Poison Ivy left behind, the sector may be changing, slowly, but they're not changing in any hurry. It's no surprise audiences are skeptical when vendors show them what the world could look like, and does look like in other emerging and developed markets.
Ivo Vegter is a freelance journalist and columnist, who blogs at http://ivo.co.za/. But he doesn't video-blog or watch advertisements while retrieving voicemail.
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