Industry adopts 'wait and see` approach to deregulation

Johannesburg, 23 Nov 2004

Following yesterday`s clarification by the regulator regarding the minister`s deregulation announcements, the industry has expressed 'cautious optimism` about the fact that the authority has chosen to take the more open view on the issue.

The Independent Communications Authority of SA (ICASA) said yesterday that as the further liberalising of the sector will increase consumer choice, it would also be examining ways of reducing the cost of communications.

"We received many written submissions from industry players, and gained much insight from the recent colloquium, which was well attended by the sector. This has helped us in preparing ourselves for 1 February next year, as we want to be 1-2-5 compliant, so to speak," says ICASA chairman Mandla Langa.

According to Mike van den Bergh of Gateway Communications, ICASA`s stance is positive from the viewpoint of value added network service (VANS) providers and players hoping to roll out voice over IP (VOIP) services.

"The most important thing is that the regulator has clarified the issues surrounding VOIP services and those of self-provisioning for the mobile operators and VANS providers," he says.

ICASA has effectively said that a mobile cellular telecommunications service (MCTS) operator may self-provide its own fixed lines by obtaining facilities for fixed lines from a telecoms facility provider of their choice, using those facilities in accordance with its own service licence.

Self-provisioning for VANS providers will mean they can procure telecoms facilities from any telecoms facility supplier and use these in accordance with their licence to provide telecoms services.

Service level competition

"As far as I understand ICASA`s statement, this means that VANS and MCTS operators will not be able to build their own infrastructure, they will still have to get it from an infrastructure provider," says analyst Andre Wills, of Africa Analysis.

"This ruling will affect the network services layer of the ICT sector, but not the infrastructure layer, which will nonetheless help to develop competition on a service level."

The regulator says that regulations regarding numbering will be aligned to accommodate VANS licensees and that it is in the process of developing an interconnection framework for all licensees.

"This is a key announcement, as it shows that ICASA has flagged the issue of wholesale interconnect with Telkom and the mobile operators, and has set a timetable for this," says van den Bergh.

"This is an encouraging stance from the regulator and now that it has identified the issues to be dealt with, it requires strong and decisive regulation to ensure that VOIP implementation is not unduly delayed."

He says that his one worry is that the incumbent will attempt to delay the implementation of VOIP, although it is inevitable that Telkom will react in a competitive manner to an issue that could prove detrimental to its business.

Wills agrees with this idea, saying that there is a need for strong numbering and interconnect regulations, as this is a must for the future growth of the industry.

According to Cell C`s media relations manager, Happy Zondi, the company is still interpreting the determinations.

"We will put our views across as soon as we have adopted a position, and Cell C will definitely participate in the process that has been outlined by the authority," she says.

Telkom spokesman Ravin Maharaj says that the organisation is pleased that ICASA has come out with a process that will lead to proper regulations to implement the ministerial determinations.

"However, we must withhold our comments until the proposed regulations have been published. Although we believe the timetable is very demanding, Telkom will certainly participate in full."

Moving forward

The timetable laid out by ICASA will see an amended VANS Regulatory Framework expedited through a fast-track process, with the intention of having the applicants licensed before 1 February.

ICASA also says that several regulations or amendments are required, and that these - with the exception of the interconnection and facilities leasing guidelines - will be gazetted for public comment by 29 November.

Public comment on this will be due for submission by 7 January, and this will be followed by public hearings in the second week of January, with the final amended regulations to be forwarded to the minister by 21 January.

ICASA says that a final work programme for the interconnection and facilities leasing guidelines will soon be made public, with it being the authority`s intention to have this framework finalised by 28 February.