BandwidthBar

In July 2009 the long awaited SEACOM cable was finally completed. This 17 000 km promised to connect Africa to the rest of the world by providing level of bandwidth previously unknown on the African continent. Already news from East Africa speaks of increased bandwidth, faster broadband connections and cheaper Internet, but the same cannot be said for South Africa. What is that is keeping South Africans from reaping the broadband benefits of the SEACOM cable?

 

The immediate answer most people think of is Telkom. As the only telecommunications service provider in South Africa for a long time, Telkom holds the monopoly for any form of communication that uses its copper wire infrastructure including telephone lines and broadband Internet. And that means any form of wired ADSL or broadband connections you might mention. While the telecommunications giant effectively holds the infrastructure hostage, other service providers find it hard to compete effectively.

 

One of the biggest effects the SEACOM cable claimed to be bringing to South Africa was cheaper broadband and no data caps. In the months after the cable was completed many ISP’s have provided more gigs per rand but the change has been slow to say the least. People question why we are not seeing the results of higher bandwidth the same way East Africa is and what happened to the incredible price reductions that were promised.

 

It is the local loop that is solely owned by Telkom that is part of the problem. Every ISP has to go use Telkom’s wire infrastructure to give their customers the broadband connections they need. Consumers end up paying one fee to Telkom for the line and another fee to the ISP for their services. It all adds up to a tidy sum at the end of day. For ADSL and broadband prices to drop significantly every player needs to have equal access to the local loop without needing to go through Telkom.

 

Thanks to the cost of rolling out a nationwide infrastructure to compete with Telkom’s the chances of the status quo changing any time soon seem rather slim.

 

Of course Telkom is not alone to blame for the state of things. While they still hold the monopoly on the local loop other service providers are not doing much on their side to lower their prices. The theory was that ISP’s would not risk their profits by lowering their prices, but rather offer more bandwidth for the same fee. While some ISP’s have gone this route it is too little to really make a difference in the end consumer’s broadband experience.

 

With no real competition in the marketplace and Telkom’s stranglehold on the infrastructure it seems as if South Africa may be suffering under high prices for broadband for some time yet. Even though some new entrants into the market are trying to make their mark, only time will tell how successful they will be.

 

 

 

 

 

 

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