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ELIAC's Submission on PSTS Ministerial Determinations

People might want to take note of the date that this was sent to ICASA it was at one point available as a submission on the ICASA Website – However we have noticed that this and other submissions are no longer listed. Note that even at this point we were talking about the advantages un-metered local calls would have for the disabled, schools and people working from home. This has become more important in light of the high fuel prices, high interest rates, rising food prices, more than ever South Africa needs good affordable communications – Despite Thabo Mbeki stating in his opening of parliament speech (11th February 2005) that the cost of communications is far too high, very little has been done

22 – March - 2005

Eliac – East London Computer and Internet Users Group

Dear Minister Ivy Matsepe Casaburri, ICASA Members and Members of the Telecommunications Industry

 Email to Amatthysen@icasa.org.za

In reply to Section E of Ministerial Determinations:

It is our opinion that for competition and growth in the communications sector to take place, and also that all the people of South Africa to benefit from affordable and available communications, the following needs to be implemented as quickly as possible.

Un-metered Local calls
Broadband Mains Internet

The concept of paying per minute or second for local calls is both un-fair and has caused un-told damage to the communications industry. It is not based on costs but rather on what the service provider (in this case Telkom) can take from customers. It is quite odd that the Pharmaceutical industry has been subject to not mark up excessive prices on Drugs, but Telkom is allowed to do so on Phone services, which are also a basic and essential service.

The USA, Canada, New Zealand and now to some extent the UK all have a system of un-metered local calls, in New Zealand this costs as little as Twenty (20) New Zealand Dollars. This means that provided it is a local call a person can stay on the phone from the beginning of the month, to the end of the month and only pay twenty dollars. Why is this you might ask? Well the fact of the matter is that once you are connected to the loop it does not cost the service provider any extra, it is not like Electricity or Gas were you are using energy. It is our opinion that unless responsible costing and pricing of services is introduced, in this case un-metered local calls, a SNO is not going to effect much change. As is pretty much the case with Cell phone operators at present.

Un-metered local calls would have the following impact:

Schools could connect to the Internet during the daytime and not have to worry about call costs, this would be far better than giving schools a 50% discount as Telkom currently charges more for peak (daytime) local calls. For example one hour of Internet would cost R 22,40 – even with 50% discount this is still R 11,20 an hour - If the school was on line for two hours a day and five days a week, this would cost R 448,00 a month. It would be cheaper to connect via ADSL which would most likely come in at a discounted price of R 500,00 a month (let us not go into the data Cap at this point)

HOWEVER this is all well and fine for schools that can at this point be connected to ADSL or other similar services, but a lot of schools will not be able to take advantage of this technology but would benefit just as well from un-metered local calls

The disabled could benefit as they would be able to work from home by either doing work over the Internet, such as typing, market or commercial research, or even answering email inquiries from different countries were the labour costs are high but would take advantage of the exchange rate.

Typists and other workers could take advantage of un-metered calls as they would not even have to leave home, they could log onto the Internet and pick up their dictation and email the finished work back, they could also take on work from overseas and thus earn overseas currency. Not having to travel to work means that they can save time and money in transport costs. Also there are the dangers of travelling on the roads, less wear on the roads means less money in taxes, and being at home would not only help with family issues (especially for mothers) but might well cut down on house break ins. The elderly and the infirm would benefit from un-metered local calls as they could keep in touch with people, family and friends, either locally or on the Internet.

People in rural areas will benefit as they can gather information and have access to markets and job centres. People can educate themselves via the Internet. Markets can be established, for example someone in the USA might be looking for a part for an old car which is standing in a garage somewhere in the Transkei. People can start industries from learning things of the Internet, like recycling and so on. The cost of a computer that can connect is so little these days, even a second hand P1 with a one gig hard drive will give good results.

Internet users would benefit from un-metered local calls, at present it is far too costly for people to use the Internet due to Telkom’s pay per second / minute billing structure, again it is not based on costs, but rather than what can be obtained from users, this is grossly un-fair and needs to be address as a matter of urgency, perhaps even a commission of inquiry set up to look into this. South Africa has over the years slipped down the scale of Internet users and expertise which is in a large part due to Telkom’s expensive phone call charges.

Broad Band Mains Internet

It is widely acknowledged that Telkom’s mandate to connect people in rural areas has failed. Of the 2.8 million people they were supposed to connect, they managed to connect only 2.5 million, of which two million subscribers have been disconnected. What business can afford to lose two million customers? The system they introduced for a lot of these areas is the Dect system, which is basically a radiophone system, which cannot be easily used for data and therefore the Internet

Broad Band Mains Internet is being currently used in the USA, UK and other countries as an additional means of Internet connection and also to connect people in rural areas. The Internet signal is transmitted over the mains electricity as carriers on the wave, similar to the way FM works. The advantage of this in South Africa would be that it could easily be introduced into rural areas, and could be used for voice and data. Service providers could be established in these areas and empower the community from there, this fits in well with the concept of allowing other parties to contribute to the communications network. As Eskom will be part of the SNO – I would think they are well placed to help make this a reality. It is rather disappointing that Telkom did not follow this route. However at the end of the day it might well be better and more cost effective to have both data and the electric supply on the same line / cable. Also it might be an idea to allow people in rural areas to enjoy a less expensive service, as it is far better to have more people paying a little than a few people paying a lot. For example people could make calls anywhere in SA for a cost of R 20,00 a month.

I hope this information helps; it has been made possible by myself and members of ELIAC

Paul Wiggins – Chairperson ELIAC

Additional Info not part of the submission – The cost of local calls and problems with business. When phoning it costs over fifty cents per 1.5 minutes (now 59 Cents in standard time) so lets look at a few typical local calls. Phone someone and get wrong number, money gone. Phone and get put on hold, passed from department to department and then get put on hold, the person you want is busy and you have to wait. Trying to guide someone through a pc set-up or similar situation were you are on the phone for a long time having to ask questions and explain things, or trying to guide someone through something

Here is a interesting story about the Service Industry, it is the story of bad service, and this is just one aspect that is being brought up because it has to do with communications. Often you will see what can be called the ' run around ' someone will go into a shop and ask for something and be told... no they don't have that, try down the road or So-and-so up town. This is not service, phone the place down the road or up town and see if they have it for the person, you will be surprised how grateful some customers can be when they get good service. It is like people coming into a hotel that is full and they are told try the hotel down the road or the one on the far edge of town is great and not normally full. This is not service, people are tired and have travelled far, now they have to go somewhere else which might also be full, and then there is the frustration of not known were you are going, phone the places for the people and see if there are rooms available, this is service. Again one of the problems is the cost of local calls, which if we had un-metered local calls it would not be a problem. Metered local calls, and the high cost of communications is now is turning us from being friendly and helpful, to being rude and closed off.

One of the problems with Share call numbers is that it makes it possible for people to close offices and run call centres from other towns, but do not think it will stop there, call centres will move to major centres, then as costs are cut so that the share holders can benefit (as can all the fat cats who have share options) then it will move from a few call centres, down to one big centre, and then it will be off to India

One good thing that has been introduced is per second billing for calls made to an ISP – normally if you have to test a modem or a customers dial-up connection, you can end up losing a small fortune on sixty cents minimum dial charges. There again in my opinion having to pay for local calls is wrong anyway

© Copyright 2005

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