Facility sharing is a mess, says Telkom

By Phillip de Wet for Telkom
Johannesburg, 03 May 2002

The facility leasing guidelines currently being considered by the Independent Communications Authority of SA (ICASA) are "a complete and utter mess" according to Telkom.

"There is no way those regulations can pass the law; no way they can be implemented," says Gabriele Celli, the company`s regulatory relations executive.

The result could be further delays in the switch-on of the second national operator (SNO), which will require access to Telkom infrastructure to deliver its services. Although the exclusivity Telkom holds on fixed-line telecommunications expires next week, the SNO is not expected to be licensed before October.

Celli says the regulations, which will enable the SNO to sell services over Telkom infrastructure for the first two years, are so badly constructed that he cannot even suggest changes to make it workable.

His basic argument is that most of the facilities listed in the regulations, and which Telkom will be forced to provide to the SNO, are actually services. As the Telecommunications Amendment Act calls for infrastructure to be shared, not services, he says the regulations would be unlawful.

The facility sharing guidelines were published in draft form in March and comments on the document are currently under consideration by ICASA.

Sentech part of the plot?

Celli says the regulations are either simply very badly written or part of a more sinister agenda, which includes turning state-owned signal distributor Sentech into a third national operator by stealth.

In a series of turnarounds last year, government policy shifted from one national operator competing with Telkom to two competitors, and back to one again in a matter of weeks. During the same period, plans for Sentech changed from allowing it to offer consumers international telephone calls via television infrastructure, to making it a carrier-of-carriers. A controversial "multimedia licence" was later added to its grant.

It is the multimedia licence that worries Celli.

"If one has to be cynical about this, and sometimes one has to be cynical, we read this licence as not being much more than a broadband licence," he says. And taken with the carrier-of-carrier provisions, which will allow the company to sell wholesale international services to other operators, "we believe that we are in fact back to three national operators, not two," he says.

Carrier pre-select

Celli is also concerned about provisions for carrier pre-selection, which is to make it possible for callers to select any operator for long-distance and international calls.

Telkom has consistently warned that the price users will pay for pre-selection will be much higher than the benefits they receive; Celli says Telkom would have to spend "from tens of millions up to R400 million" to implement it, depending on the type of selection that is implemented.

Telkom is calling for call-by-call carrier selection to be used in 2003. This would see users required to dial a pre-set code every time they want to make a long-distance call through an alternative network, instead of being able to make a network selection once and having it automatically activated on certain types of calls.

The incumbent prefers this option because it is cheaper, but it expects stiff opposition. Call-by-call selection is tedious, and the SNO and Sentech would prefer to eliminate such user inertia.

Telkom believes the intention is for it to foot most of the carrier pre-selection bill, which also feeds its suspicion about the motives of government and the regulators.

"I like competition generally, but I don`t like competition if I have to pay for it," Celli says. "I don`t want the regulator to choose the winner, I want the market to choose the winner."