There was a lot of hype surrounding the landing of the Seacom cable last year, and although many ISP’s have reacted positively with price reductions, the revolution everyone expected hasn’t yet materialised.
Another bandwidth cable, the Eastern Africa Submarine Cable System (EASSy), should go live in the second half of next year, increasing our international bandwidth further. But if there’s something we’ve learned from Seacom, it's that capacity alone doesn’t make a difference. It’s access and quality that will have the greatest impact.
The primary problem facing ISPs regarding pricing, is still getting huge volumes of data to various datacenters and then moving it, over the very costly IP Connect service, to ADSL customers. As a corollary, the primary expense of ISPs is still the local links, which are owned by Telkom.
Personally I don’t expect much of a price change in 2010 unless there is a major shakeup by Telkom. Instead of the Competition Commission’s hefty R3.59 bn fine imposed on Telkom for abusing its competitive position (upheld by the Supreme Court of Appeal), it would have been better if Telkom was forced to bring down the pricing of products that affect the public’s broadband costs.
While we are still restricted by the costs of certain Telkom products, they are still in large part the leaders in connectivity technology. I expect a lot of businesses to take up Telkom’s new Metro Ethernet products which will bring massive amounts of bandwidth for internet and inter-branch connectivity.
With any luck, Telkom’s largest fixed-line competitor, Neotel, will start delivering more stable products in 2010. Their 5000 km national fiber network project, currently being built in collaboration with MTN and Vodacom, looks to be progressing well. We can expect Neotel and the cellular operators to experience substantial cost savings, and to consequently deliver better coverage and pricing on voice and data.
2010 is of course the year of the World Cup, and it will be interesting to see if the networks are able to cope with the broadcasting and increased demand created by this wonderful event. The World Cup has been the driving force behind some of the higher capacity Next Generation Networks, which will be available for commercial use post the event.
In short 2010 will be a very interesting year in the ISP arena. The end user might not see the immediate effect, but there will be many positive things happening that will lead to better pricing, greater speed and more choice for consumers.
Martin van Dyk has 20 years experience in the IT industry, of which six include work on international communication networks. He is currently director of internet service provider XDSL.
