Telecoms competition good for consumers

13 October 2008 - IT-Online

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Customers should soon see the benefits of increased competition in the mobile
telecommunications space as Telkom prepares to take the major players head on. This is
as a result of the announcement that Telkom will be selling its stake in Vodacom.
According to news reports, Telkom is also already in the process of building its own
wireless and mobile broadband network.
"I believe this increase in competition is going to shake up the market and provide
customers with greater freedom of choice," says Anton Potgieter, CEO of the Huge Group.
"From a consumer perspective we will see the major players soon having to provide true
value added services, rather than just access to telephony - and down the line it could
even lead to a reduction in prices."
Other recent movements in the industry, such as the Altech court ruling, all point toward a
liberalised telecommunications industry for South Africa. "I would however caution
customers to remain patient as these changes unfold - the benefits will come, but as usual
it will not happen overnight," he says.
According to Potgieter the changes in the industry will have two major effects.
"Firstly, it will lead to increased competition, and secondly, companies will now have to
deal with a significant increase in the number of routing options available to them, which
means it will become a lot more complex to determine the most cost-effective option for
their organisation," he says.
As the playing field becomes more complex, Potgieter believes more companies will turn
to managed telecommunications companies to ensure that they run their
telecommunications in the most efficient way.
"For a company to spend their time determining which route would be the most costeffective
just doesn't make sense," says Potgieter. "While it is an important element to
ensuring success, it is not income generating and should therefore rather be outsourced to
companies who specialise in this."
According to Potgieter, in managed telecommunications there are a number of variables
that come into play when determining the most effective routing of calls, including time of
day routing and on-net versus cross-net calls.
"The definition of an on-net call is when the call is initiated and terminated on the same
network," says Potgieter.
A cross-net call is when the call moves from one network to another, resulting in
interconnect fees, and thereby making the call more expensive. "It also doesn't make
sense for companies to just stick to one infrastructure and/or service provider - where it is
cheaper to route via another network, this should be taken advantage of," he
says. It is also critical that routing decisions can be made and managed in real time.
Potgieter believes that by working smartly, organisations can capitalise on the changes
that lie ahead.
"By putting the right tools in place companies have the opportunity to get the best of both
worlds," he says. "We have seen proven results time and time again, where organisations
have been able to save tremendous amounts of money on their telecoms bill through
effective least cost routing and proper managed telecoms."
He also says that the increased competition will definitely be to the benefit of the end-user.
"Effectively each of the players will be competing for new market-share, which means they
will have to be competitive in their pricing," says Potgieter. "This, in conjunction with an
effective managed telecoms solution, will put organisations in the best position ever to
save on their telecommunications costs and to themselves become more competitive," he