- Fibre to the building
2013 was the year of sharp fibre price cuts, causing a spike in fibre-to-the-building installations that will cause a steep rise in the number of businesses - big and small - with access to true symmetrical high-performance broadband.
A 1 mbps service can cost as little as R1500 for installation and R1500 in monthly subscription fees, and is available from providers including Internet Solutions and Neotel.
Having fibre makes a company's transition to voice over IP infinitely easier, as the speed and other performance improvements remove much of the hassle of engineering VoIP.
Fibre's superior response times further contribute to VoIP's attraction. Analogue access lines have an inherent delay in the modulation-demodulation process. For their part, digital circuits have latency delays in the low hundreds of milliseconds, while fibre is orders of magnitude faster, with latency as low as 1.5 to 2ms.
Reflecting this trend, we are noticing a rise in a new kind of niche network provider that specialises in pulling fibre from the kerb into business premises. Communications service providers will have to work out pricing models that allow this development to flourish.
- National fibre
Another important trend relating to fibre costs is the launch of a number of new north-south fibre services. FibreCo Telecommunications, for example, completed its fibre-optic network in November, interconnecting Johannesburg, Bloemfontein, East London and Cape Town and providing more cost effective open-access fibre.
Together, these two events will dismantle one of the biggest inhibitors to adopting fibre connectivity - cost - heralding great benefit for communications in this country.
- Interconnect slippery slope
In March 2013, Icasa (the telecommunications regulator) announced the third in a series of interconnect (IC) rate cuts (the rate one telco charges another for connecting a call to its subscribers). From R1.25 three years ago, the IC rate is now R0.40 for calls to mobile operators, 19c for national fixed-line numbers and 12c for local fixed-line calls.
Unexpectedly, Icasa announced it would start another round of annual reductions in the IC rate, starting in 2014. This will result in further price cuts and market competition.
The legacy business models of the mobile networks will come under great pressure as a consequence, as their revenue from voice minutes halves, while VoIP players, which benefit extensively from zero-rated Internet Protocol calls, will benefit.
For Telkom, this is also good news. While its income from termination rates is now significantly lower, its enormous cost of sale of call minutes to mobile networks (R2 billion annually) will effectively be halved come March 2014.
- BYOD
The "bring-your-own-device" (BYOD) trend is another that has gained traction this year.
Essentially a nod to the tidal wave of digitally-empowering consumer technologies, BYOD is accommodated in the enterprise with more open interfaces to the corporate network, allowing employees to use their smartphones and tablets extensively from home, during travel and at the office.
- Hosted (cloud) services
The rise in hosted services is an outcome of a range of factors, including the proliferation of affordable fibre services and the benefits of network-based application architectures (such as easier management, provisioning and fault monitoring).
South African developments closely mirror international trends. We regard the following as significant:
