Diallers skip digits

By Nicola Mawson for Telkom
Johannesburg, 17 Jan 2007

While Telkom insists 10-digit dialling was introduced without a hitch yesterday, there were some teething problems.

The system requires that all local calls include a dialling code from 16 January. It provided that local calls that were not dialled with an area code be routed to an announcement requesting callers to dial 10 digits. This service will continue until 16 March, after which such calls will be routed to a "number unavailable" tone.

However, a spot-check of several large metropolitans revealed that seven-digit local calls made in parts of Johannesburg and Pretoria failed to connect to this message service.

A few seven-digit local calls made in Cape Town, Durban, Rustenburg and Johannesburg also connected directly to the recipient, without prompting the caller to use the dialling code.

Cautious approach

Telkom would not explain why the expected procedure, where seven-digit calls are routed to an announcement service, was not fully functional.

The fixed-line operator did, however, note: "The seven-digit dialling format is slowly being taken out of the network as the public start using the new dialling format."

Telkom says it adopted a cautious approach to the implementation of the 10-digit dialling format, which included an extensive media campaign educating consumers about the benefit and impact of the new dialling system.

"With the media campaigns and announcements being supplied to customers, Telkom does not expect any significant drop in local and international calls," the fixed-line operator says.

This approach has also given customers who use PABX systems an opportunity to reprogramme their systems, it says.

No impact

Industry players believe Telkom's revenue, under a sixth of which is derived from local fixed-line calls, is unlikely to be affected by the introduction of 10-digit dialling and the interim resultant failed local calls.

Irnest Kaplan, head of Kaplan Equity Analysts, does not see a major bottom line impact. "Personally, I don't think there will be a major impact on Telkom's revenue from this."

Kaplan does anticipate a few non-calls in the first few weeks, which may have a small short-term effect on the company.

However, he points out most people are familiar with 10-digit dialling from the widespread use of cellphones. In addition, Telkom has a vested interest in making sure its systems work, he adds.

Gary Chalmers, CEO of Torque IT Africa, notes companies running voice over Internet Protocol systems are already familiar with using a dialling code when making local calls.

The implementation of 10-digit dialling was not a surprise to Torque IT staff, as they already knew the system was coming, he says. "It had zero impact on us. It was a normal business day and nobody struggled [to make local calls]," he says.

Brian Mdluli, CEO of the Direct Marketing Association of SA, also notes the industry did not expect 10-digit dialling to have any impact on their operations.

Another analyst - who asked not to be named - says people who are used to seven-digit dialling will be forced to change their habits over the phasing in period. "People will wise up pretty quickly."

As a result, Telkom may have a blip in revenue for a week or two, but this will not be significant enough to affect its interim or annual results, he says.

Paris Mashile, chairperson of the Independent Communications Authority of SA, has previously stated the introduction of 10-digit dialling will increase the number of telephone lines by 20% nationwide.

The opening up of competition due to more numbers becoming available would make a difference in the longer term, says a third analyst. This could see Telkom losing revenue as an indirect result of 10-digit dialling.

Telkom reported revenue of R48.2 billion in the 2006 financial year, of which R32 billion was from fixed-line calls. Domestic calls, local and long distance, contributed R8.9 billion to this figure.