ICASA enquiry into Telkom cable monopoly ‘on hold’

6 Feb 2006

According to Balancing Act, an enquiry into whether Telkom should be allowed to retain its monopoly on an undersea cable that provides most of South Africa’s international bandwidth is on hold pending clarification from the government. A decision on whether Telkom’s stake in the Sat-3 cable should be declared an ‘essential service’ is crucial to the cost of voice and data services in the country. As it stands, Telkom is free to set its own fees for other operators looking to buy bandwidth on Sat-3; ISPs have long claimed however that the tariffs are six or seven times higher than they should be. If Sat-3 was declared an ‘essential service’ however, Telkom’s fees would be capped by ICASA. Telkom has argued vociferously against Sat-3 being declared an essential service, saying that its investment could not be recouped if fees were to be capped. Telkom has a 13% stake in the 27,450km cable, which links Africa with Portugal, and has invested USD85 million into the project.

South Africa, Telkom South Africa