A strong regulator is essential for the development of a strong and competitive telecommunications market, says Daniel Crawford, MCI`s president for international and wholesale services.
Crawford, the most senior of the US telecommunications conglomerate`s representatives to visit SA, was in the country to cement the sale of the 30% stake in local subsidiary UUNet to black economic empowerment investment firm Jay & Jay.
"The role of the regulator where there is a dominant monopoly is to ensure it does not abuse its power," he says.
Speaking to ITWeb in Cape Town, Crawford says MCI`s experiences in other countries show that once "fair and equitable" access is given to international landing sites for telecommunications links, such as the SAT-3 undersea cable, then the market opens up for his and other companies to invest further in order to compete effectively.
"We are not looking for a free ride. In India, VNSL controls the landing point, but the government there has mandated that free and equitable access must be given to other players. We are happy to pay for the use of the facility and we are able to deliver our products and services there," he says.
The opening up of the international landing points, controlled by Telkom, has been the subject of heated debate recently in industry and government with the latter proposing to declare them an essential service, which would open them up for use by other companies.
MCI owns 23% of the consortium that controls the SAT-3 cable.
"We are irked that we are not able to access our own facility," Crawford says.
He says the deal with Jay & Jay is seen as a necessity to help shore up UUNet`s position in the market.
"The deal removes a pre-qualifying obstacle should we want to bid for various business. This means that our bids can be judged on an economic basis," he says.
According to Crawford, MCI examined a list of about 18 potential suitors for UUNet, and settled on Jay & Jay because it had the market experience and the money to do the deal. He would not disclose the value of the transaction.
He acknowledges that a company headed by a former minister of communications (Jay Naidoo) is useful as he would know the industry and the situation.
"It is not unusual to see well educated people moving between government and industry in a small country. For instance, some of our previous employees now hold senior positions in Mexico," Crawford says.
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J&J buys 30% of UUNet
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