Branson: It is dominated by Vodacom and MTN, and they have significant influence over the industry. Competing against such large players is not easy, especially when the regulatory framework does not specifically help younger, smaller companies.
Call termination rates, for example, are not proportional to the actual costs incurred by each operator and MVNOs. This is not currently permitted in SA and could bring more competition.
We have also seen limitations in international gateways and high international and roaming call charges. We are observing, however, that the international telecoms traffic market is now beginning to open up.
ITWeb: What do you see as a key ingredient towards creating a booming telecoms sector in Africa?
Branson: Open competition brings a myriad of benefits - both in terms of increased investment in infrastructure and services. Any activities which support the successful introduction of new competitors are beneficial, provided this is done in a way that allows the industry to remain profitable overall.
I believe some of the fastest growth rates will be seen in Africa for both mobile telecoms and ICT generally.
Richard Branson, founder of the Virgin brand
Mobile number portability is a service that frees up customers and allows them to select the service which suits customers best, without losing their number.
ITWeb: What are government's responsibilities in creating a progressive African mobile telecoms landscape?
Branson: Governments, regulators and the judiciary need to act quickly to prevent abuse of power in the sector. Fraud, related to mobile telecommunications services, is a problem in every country worldwide and is a significant problem in Africa as well.
There have been cases in Africa of large players putting the squeeze on new competitors by withholding interconnect payments.
ITWeb: What positive aspect does the South African telecoms sector hold?
Branson: There are a great many positives! The market is growing fast, lots of new, exciting services are being launched, competition is increasing (something Virgin Mobile has helped significantly with), and customers are getting a better deal than ever before.
Potential changes in ownership may occur, but should not impact all these positive factors.
ITWeb: How do you see Africa placed in terms of ICT growth in the next few years?
Branson: I believe some of the fastest growth rates will be seen in Africa for both mobile telecoms and ICT generally. As each development occurs, it encourages the next and I see momentum continuing to accelerate. This can only be good for Africa as a whole.
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