Johannesburg, 28 Jul 2000
At the first ICT 2000 conference held at the Vodacom LINK centre this week, telecoms scholar Bill Melody suggested that South African policy-makers "look long and hard" before instituting a duopoly when Telkom`s exclusivity period comes to an end.
"A duopoly gives you the worst of both worlds," he said, speaking at a session on the challenges and choices of liberalisation.
The conference focused on innovation, delivery and development in the telecommunications sphere.
Melody, a course director of a telecommunications masters programme at a Dutch university and founding director of an IT and communications research centre in Australia, said that a duopoly means an expensive and needless duplication of services and infrastructure without introducing enough competition to lower prices significantly.
Give an open invitation for licence proposals, Melody said, and licence anything that would promote national objectives. "I would be inclined to look for proposals that would be of benefit to the public." He said such an approach would allow for small operators with creative ideas to enter the market.
He also cautioned against a regulatory environment that would bring infrastructure competition to the "last mile", the connection that reaches into the homes of users. "Do you really want to use resources to duplicate links to people`s homes so that rich people can have two links?" he asked of future regulators.
The session speakers agreed that debate on the liberalisation of the market is needed ahead of the planned issue of a second, and possibly more, fixed-line licences during next year.
William Currie, the only former SA Telecommunications Regulatory Authority (SATRA) councillor to serve on the council of the Independent Communications Authority of SA (ICASA), says debate is needed on the viability of a duopoly or oligopoly, and on the feasibility of infrastructure- and services-based competition.
"The DG [director general of the department of communications] has indicated that the government is open to introducing more than one competitor," Currie said, but he had no ICASA position to share. "We don`t yet have a position on liberalisation, seeing that we are only three weeks old," he said, cautioning that his views were purely personal reflections.
Currie believes the challenge for ICASA will be to ensure that no one player has control over the network as a whole, or the ability to erect bottlenecks. He suggests modelling interconnection regulation after the architecture of the Internet, with an open design that makes it unnecessary for users to know which networks they are using to reach their destination.
Karabo Motlana, the head of Telkom`s regulatory affairs department, said that the regulator should maintain a balance between the need for universal service and allowing prices to decrease.
"Pricing should be at a level that allows services to be rolled out to allow access to the most people," he said. He also had a word of caution to add on the subject of spectrum auctions, suggested by Melody as a workable alternative to the "beauty contests" used in SA to award licences.
"Whoever wins the auction must recover the cost from somebody," Motlana said.
Share