Johannesburg, 27 Nov 2007
Neotel`s next-generation network (NGN) holds the promise of changing the face of Internet economics by moving away from the multi-tier model that dominates the local industry, its officials say.
Yesterday, Neotel unveiled its enterprise offerings in Cape Town, after first presenting them in Johannesburg two weeks ago. It is due to make a similar presentation in Durban tomorrow.
Into the cloud
Neotel CEO Ajay Pandey says the NGN being set up by his company means an end-user has to make one hop only into the Internet cloud through the Johannesburg point of presence, denoting true tier-one connectivity.
"This means there is only one hub or router to connect with and you are in the cloud. This is far better than the two or three connections people have to make at present. It reduces costs and, of course, improves speed and reliability," he says.
Neotel CTO Angus Hay says: "South Africans are still asking the wrong question about Internet connectivity. They are asking: 'How much do you charge to connect internationally?` when, in fact, they should be asking: 'What is your latency rate between the US West Coast and Johannesburg?`"
Converging costs
Hay says for many of Neotel`s larger customers they have been able to offer a solution that involves placing an Ethernet port on the router at the customer`s premises. It connects directly on another Ethernet port on a router somewhere else.
"That is true end-to-end connectivity as it means no conventional transmission network is needed," he says.
This also signifies a convergence of costs, because there are fewer layers. This leads to a reduction in the amount of commission that has to be paid to various parties involved in a multi-tier network, Hay says.
Cost is not the only place where Neotel aims to be competitive. Pandey points out that because Neotel is "leap-frogging" in terms of technology, it is able to offer its larger clients the flexibility they require as their businesses and models change.
On the hunt
Neotel is actively pursuing the country`s top 350 organisations and has recently signed up clients such as Standard Bank, Rand Merchant Bank, Investec Bank, MWeb, Internet Solutions, Web Africa, Mittal Steel, Tata, academic network Tenet, the State IT Agency, arivia.com, TeleTech, Transtel, MTN and Cell C.
The second national operator is looking to develop package solutions for smaller companies and suggested a "telecommunications-in-a-box" type of approach, Pandey says.
"This will not be done by Neotel alone and we are holding discussions with a number of possible partners, such as Cisco."
City connectivity
Apart from developing its international bandwidth capacity by being allowed access to Telkom`s SAT-3 undersea cable, its alliance with Seacom [to be operational in the first quarter of 2009], and its involvement in the East Africa Submarine Cable System, Neotel is also building up its metropolitan area networks.
In Cape Town, Neotel has laid about 100km of its trademark orange duct that carries its fibre optic cable, and plans to lay about 750km in the province over the next four years.
"This is part of a deliberate strategy by Neotel to ensure our core network lies not further than between three to five kilometres from our large clients," Pandey says.
Municipal-run networks, such as those being laid out in Cape Town and Durban, will be complementary to his company rather than competitive, he concludes.
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