More than 450 million people around the world are now using their cell phones to access the Internet. By 2013, this will rise to 1 billion, according to International Data Corporation (IDC). A significant part of this huge demand is generated by mobile applications – apps, as they are called now. The rate of growth of the mobile Internet is faster than the adoption of TV, radio and the desktop Internet. ABI Research recently predicted that 4G mobile consumer service revenue in 2014 will top US$70 billion. That's a huge opportunity for the companies that get this right at the right time. Gartner analysts recently commented that “telecom carriers (particularly those in mature markets) intent on pursuing non-traditional service opportunities need to act now, if they have not done so already.” Consumers are eager to take advantage of the new possibilities. What they expect is a superior user experience and access to innovative services, applications and content. They want to access these services on any device at any time from any place. The only way to exploit this opportunity is to provide easy to use, compelling applications and services that “just work” every time, regardless of the mobile device or operating system. It is imperative that mobile operators, device manufacturers and application developers start looking for more effective ways to work together. But too many operators – especially some of the world's leading ones – are dragging their feet and not embracing these realities. They think they can decide which services and applications their customers will be allowed to use over their network infrastructure. Ultimately, they will find out that this is no sustainable business model in an app-centric world. Apps don’t take away revenues or anything from operators, they add something. Skype, for example, is often accused of taking something away from operators. There is no better counterevidence than the partnerships we have formed with Hutchison Whampoa's 3 in the UK (3UK). 3UK is allowing mobile Skype calls over the Internet at no extra cost, providing a comprehensive user experience by integrating the Skype application into a wide range of mobile handsets. 3UK's customers who use Skype generate 20 percent higher margins. A survey undertaken by 3UK in August 2009 revealed that, on average, users of Skype used 17 percent more traditional voice minutes than non-users. As well as being a valuable customer acquisition tool, Skype users on 3UK have a lower churn rate and higher ARPU. This clearly demonstrates that innovative applications like Skype can deliver improved financial results. Smart, forwardthinking operators around the world are coming to the same conclusion. An example is an operators like Verizon Wireless who recently announced a partnership with Skype at the Mobile World Congress in Barcelona, Spain. This announcement, according to Dario Talmesio, Senior Analyst at Informa, “demonstrates that mobile operators are beginning to change their attitude towards VoIP providers. They have gone from blocking to managing what they consider to be an issue. Those operators wanting to be serious players in the mobile Internet need to embrace openness and they need to allow Internet services on their devices - this includes VoIP." He concludes: “Blocking VoIP simply doesn’t work for customers".
Democratising Telecoms In South Africa... and beyond
Partnership Will Help Operators in Emerging Market Offer VoIP and Next-Generation Services Easily and Cost-Effectively.
JOHANNESBURG, South Africa – Multisource, the South African wireless services provider, and London-based XConnect, providing next-generation interconnection and carrier ENUM-registry services, have formed a partnership to help South African service providers take advantage of growing opportunities in the country’s increasinglycompetitive telecommunications market.
AN INTERNATIONAL ALLIANCE
The partnership, known as XConnect SA, will establish a multilateral peering federation, which will offer operators advanced VoIP and next-generation network (NGN) peering capabilities via an in-country interconnection hub. The Federation will provide a simple, cost-effective means for exchanging traffic within Southern Africa and globally. The newly appointed CEO of XConnect SA, Christopher Geerdts, said the partnership underpins the principles of Interconnect 2.0, ushering in the next generation of VoIP in South Africa. “Our vision is to democratise voice and multimedia communications by empowering telecommunications players to focus on growing their core businesses whilst reducing barriers of complexity and costs,” he said. He added that one of the key benefits of Interconnect 2.0 is the ‘IP-all-the-way’ principle, which ensures that the quality of calls is maintained and multimedia services can be fully utilised. The Federation services will be launched in May, enabling operators to interconnect their networks and to route calls seamlessly and efficiently through a scalable, multilateral interconnection hub. This single regional hub, enabling multi-lateral IP Interconnection and Peering is based in Telehouse at Teraco in Johannesburg. The single hub will offer, for the first time in Africa, two significant and primary benefits, namely a single point of interconnection between all providers, and subsequently policy management of the interconnection point for those service providers. This considerably reduces the overall costs of managing a complex set of interconnections, in addition to managing interoperability issues between protocols, particularly when set within the imminent multimedia and High Definition (HD) voice environment.With fibre connectivity bringing the possibility of more and improved services, at lower costs, South Africa is on the cusp of a genuine democratisation of its telecoms environment, and a paradigm shift from simply a VoIP environment to a SoIP (Services over Internet Protocol) landscape. The possibility of HD voice and improved multimedia services become a reality through the creation of this single regional hub. In April 2010, U.S. VoIP service providers offering highdefinition (HD) voice services participated in a trial of the world’s first IP-peering federation created for exchanging HD voice traffic. HD voice reproduces human speech with substantially greater clarity, depth and nuance, using codecs that capture more than double the frequency range of traditional circuit-switched calls while generally requiring less bandwidth. The rich, naturalsounding quality of HD voice calls often is likened to that of face-to-face conversations. As a result, fixed, mobile and Web 2.0 service providers are increasingly adopting HD voice as an added value because it enables superior-quality voice communications compared with those supported by the legacy PSTN. However, most HD voice services today are available only within a given operator’s network. Global utilisation of HD voice will require crossnetwork calling, with the entire call path and all endpoints supporting the rich features. The Global Alliance of Federations was set up to enable this. XConnect CEO Eli Katz comments: “Our Interconnect 2.0 services are ideally suited to helping operators in South Africa overcome the challenges of next-generation interconnection and peering. The federation will enable easy interworking and interoperability between fixed, mobile and Web 2.0 networks.” The Global Alliance enables members to deliver advanced IP services across regional and global networks, as well as decrease costs and increase service quality. In addition to reducing termination costs, service providers are spared the considerable time and resource allocations of establishing and maintaining separate interconnection agreements with each of numerous providers. End-to-end IP interconnection also allows for higher call quality than the PSTN can support, as well as multimedia features. “With the proliferation of IP and VoIP players, the complexities and associated costs of interconnecting operators and telecommunication networks have become central concerns for South African service providers,” said Multisource CEO Richard Smuts-Steyn. “To compete successfully in our country’s emerging telecoms market, operators need a secure and scalable point of interconnection and the comprehensive services our federation will offer.”
WHAT THE FUTURE HOLDS
“As we enter an era of explosive growth in South Africa’s VoIP market, in terms of services and complexity, service providers are looking for solutions that can offer more cost-effective ways of communicating and carry the functionally rich bouquet of multimedia communications from end to end,” he added. Smuts-Steyn noted that interconnectivity extends beyond traditional voice connections to include the multimedia environment. For example, he said: “When you talk with someone on Skype, you are able to use both voice and video. When you break out of the Skype environment and connect to a cell phone, you lose the valueadded video connectivity. This is because many networks do not support the complexity of multimedia interconnection. The new federation will provide technically elegant interconnect across all mediums.”The ultimate goal of this partnership is to create a virtual network and provide regional services that instantly integrate with all networks globally, and create a truly global service similar to markets in Europe, North America and the Far East. Within a regional context, the agreement keeps Africa at the forefront of developments in ICT and ensures that the momentum of the last decade towards ICT’s as enablers of development and change remains unabated.
Sidebar: THE 2008 ALTECH RULING: THE IMPLICATIONS FOR AFRICA
The 2008 Altech Ruling by the South African High Court, under Judge Davis heralded the era of true liberalization for the country’s telecom sector. The Transvaal Division of the High Court ruled in favour of an urgent application brought by Altech Autopage Cellular on the question of whether VANS are allowed to self-provide (build their own networks or lease these facilities from companies such as Telkom). “It is declared that the applicant [Altech Autopage] was entitled to self-provide its own telecommunications facilities from 1 February 2005,” acting judge AJ Davis wrote in his judgment. The South African landscape shifted from 2 fixed, and 3 mobile providers (Telkom, Neotel, Vodacom, MTN and Cell C) to up to six hundred fully converged license holders with provisioning rights). According to Alison Gillwald, Director, Research ICT Africa!, The EDGE Institute, “The judgement cuts through the defence of the Ministry and ICASA that any automatic granting of network licences to former VANS operators would result in absurd proliferation of network providers that was not sustainable in terms of the scarce resources required to do so.” This he points out, is simply not correct. Only spectrum is scarce and it is anyway licensed separately. The real cost of building and operating a network would anyway inhibit all 600 potential applicants from operating a network. The benefits to the consumer cannot be under estimated, yet an immediate constraint becomes the ability of multiple service providers to interconnect, and the regulations thereof. ICASA’s Regulations on Interconnect specifies that all providers must interconnect upon request, by law. The days of bi-lateral interconnections are numbered with the requirement for a shift to multi-lateral agreements becoming essential.
In just ten years, Africa has gone from almost relying almost solely on satellite connections to the rest of the world, to a blooming ecosystem of undersea cables that are changing the way almost
everything is done.
When the SAT-3/SAFE cables came online, in 2001, their design capacity of 120Gbit/s and 130Gbit/s was projected to be more than enough for the coming years. In fact, the long-awaited SEACOM cable, which went live in 2009, only has about 110Gbit/s lit up – or made active – of its total 1.28Tbit/s capacity. But are these design capacities, and current utilization, indicative of the demand? The past few years have seen some fantastic activity along the African coastline. While the rest of the world surged ahead, bolstering infrastructure with fibre-to-home offerings and investing in cross-Atlantic links, the African continent hobbled along on hamstrung international connections. Slow link speeds provided little incentive for telcos and governments to offer faster connectivity options, which saw little progress in the early 2000s. This was also not helped by exceedingly expensive bandwidth costs on the ageing SAT-3/ SAFE link – monthly costs for 1Mbit/s block could be up to 50 times more expensive than a similar link in Europe or North America. However, when SEACOM landed in 2009 it was hyped to be the solution for Africa’s Internet requirements. This fast, open link running along the continent’s Eastern coast was the first major new cable in about 8 years, and spearheaded the arrival of cables we’ve heard more about, since then. 2009 saw two more cables: LION, a 1.28Tbit/s system linking Madagascar, Réunion and Mauritius, and TEAMs, a 40Gbit/s direct link for Kenya to the Middle East. The U n c l u t t e r e d Cables following year saw three major links go live. MainOne is another 1.28Tbit/s cable running from Spain, along the hump of Africa, and terminates in South Africa. EASSy (3.8Tbit/s) comes down along the East coast, from Sudan to South Africa. MainOne is supplemented by a different cable system, GLO1 – a 640Gbit/s link that runs from the UK all the way to Nigeria. Later this year will see the arrival of the biggest fibre link, yet. The 5.12Tbit/s WACS undersea cable is scheduled to go live. It will link South Africa, Namibia, Angola, DRC, Cameroon, Nigeria, Togo, Ghana, Ivory Coast, Cape Verde and the Canary Islands with Portugal and the United Kingdom. Despite its high design capacity, it’s expected that only a fraction of this will be made available at first. Joining WACS is the EIG (Europe Indiage Gateway) cable. Despite its name, this 3.84Tbit/s cable will shore in Libya, Egypt and Djibouti. Later in 2011 the SEAS cable will link the Seychelles to Kenya, for access to its outgoing cables. It’s clear, then, that the last two years have brought a surplus of connectivity to Africa. Most of the cables mentioned are running below capacity though. African countries are equipped with the backhaul capacity to bring the world to their doorsteps, and offer both businesses and citizens with fantastic, high-speed access to the growing pool of information on the Internet, but there are still major obstacles to be overcome. Each country has its regulations and rules that determine how telecommunications operators may go about their business. Stephen Song, a South African broadband activist, says, “The biggest challenge we face with all these multiterabit cables is stimulating effective competition in national distribution of international bandwidth.” It is up to the governments and regulatory bodies in developing countries to make sure that they nurture an environment where growth will be promoted. Regulations need to change swiftly, to accommodate the rapid adoption of new technologies. Song adds, “Both Seacom and MainOne have been stifled by incumbents who own the national backbone infrastructure and have not bent over backwards to be helpful because of their interests in other cables.” Companies that are stakeholders in existing, older cables stand to gain more from sticking to the bandwidth or services from that connection, rather than forking out cash for capacity on an alternative solution – especially if there’s no need to. It also highlights how the success of an undersea cable is dependent on a healthy backbone infrastructure. Stephen goes on to say, “Governments face the challenge of addressing the clear strategic need for investment in national fibre infrastructure without disincentivising industry investment. Getting public-private partnership right in this area is essential.” How this is approached is not set in stone. A one-sizefits- all solution cannot be used, especially with drastically different economical and geographical factors playing a role. One country might need a full wireless deployment to reach communities in far-flung areas, where it may be uneconomical to deploy fibre or copper cables. Another country could be more suited to the conventional cable deployments. In both cases it is up to the governments, with the regulations they’ve put in place, to help promote the technologies. Once the stage has been set, it will be up to telecoms operators and ISPs to toe the line. How will they make better use of the bandwidth that’s being provided by the undersea cables? What sort of offers can made available to users, to promote usage of the services? It’s all good and well if we’ve been given unlimited high-speed Internet access, but after we’ve browsed a thousand sites and checked all our free e-mail accounts, what is left to do? Assuming a metropolitan area has had its roads dug up and an extensive fibre network has been constructed, with the co-operation of all parties that stand to benefit, they will want to start looking at ways of making that investment work. One of the best value-add propositions is a triple-play offering. Traditional use won’t see home users saturating a 50Mbit/s fibre link with regular Internet usage on two computers. But present consumers one link, with a fixed price and multiple services, and things start making more sense. A portion of that downlink can be dedicated to browsing and high-speed download services, while the rest can be reserved for additional services. Highdefinition digital TV can be delivered on a fibre connection, and internationally there are many established services offering video entertainment over an Internet connection. In the US, services like Netflix and Vudu provide on-demand streaming of full-length movies, while Hulu is a free solution that cable TV subscribers can use to watch television shows online. The examples cited are US-specific, but show how an open market and highcapacity local loop can provide more business opportunities. Internet subscribers may not have paid a telco more for the privilege of consuming entertainment, but they’re happy to pay a separate content provider a reasonable subscription fee for guaranteed entertainment. The third component of this triple-play solution is voice. There are already hardware voice-over-IP solutions that just require an Internet connection to replace analogue voice equipment. Marketing this as a cheaper solution for calls will see people use the service more often. Telcos can also remove themselves from the direct retail chain. Rather than monetizing and managing a number of services, they should see themselves as a provider of a raw material – bandwidth – while a middleman takes care of packaging and selling the product. Even in the example of a triple-play solution, an operator can give consumers the choice of who they’d like to provide e-mail, video and voice services. In essence, they can go wholesale. Let’s say a telecoms operator has a data centre with huge data capacity. They don’t have to deal with a consumer customer base, but instead let out the capacity to smaller companies that are willing to be facilitators. A video streaming service can choose to set up customer operations and a call centre, while it pays for servers and bandwidth, without having to worry about maintaining the hardware or infrastructure. The more successful the video service, the more servers and bandwidth it has to pay for. It’s a mutually beneficial relationship. One example of where triple-play has already been deployed is Kenya, through Zuku. At its most expensive, with 82 English TV channels and an 8Mbit/s Internet connection, this fibre service costs home users less than US$70 a month. Zuku’s coverage map for fibre-to-home is very limited, but it’s a great example of fast deployment and value-added services. Stephen Song also points out how certain countries have immediately recognised the strategic importance of national broadband, citing Rwanda and Kenya as examples. He says that these countries have quickly realised what is needed, and those results are now being seen. He points out that South Africa, one of the continent’s strongest economies, has sacrificed its leadership position in this area because there is no one politician or company championing the cause for highspeed Internet. It boils down to the fact that the Internet isn’t just there for watching YouTube videos and browsing websites. There are a number of services and devices that offer content to an increasing number of smart devices. High definition televisions are now being equipped with technology that will make it possible to access services like Skype, Flickr and Picasa. In jurisdictions where it is offered, video services are bundled with the TVs. The most important feature of a smartphones is no longer how it handles phone calls and text messaging, but how well its data services and application ecosystem perform. Surveys consistently show smartphone users to use more data than users of regular phones, something that is made possible by having better access to the Internet. Even more traditional services are now in need of fast, reliable Internet access. Hotels, coffee shops and conference venues can lose a customer just on the basis of wireless access. People do not want to be limited in how they use the Internet, and if more venues can affordably offer these services, the ultimate usage will escalate and the company running the cables will see more traffic – which means more money. Looking back ten years, Africa now has more than 30 times the bandwidth it had in 2001. Technology’s also become a lot cheaper, and consumers smarter. It’s been pointed out many times before that the lack of legacy infrastructure in many African countries makes it easier to adopt newer technologies and rapidly deploy them. At the moment, the biggest hurdles we face are anticompetitive practices and ageing regulations. Broadband has become a necessity, rather than a luxury. Governments can use Internet access as a tool to educate people and create a skilled workforce that will draw foreign investments. International companies no longer need to import talent, but should be able to draw from a local pool of experts, adding true diversity. Jobs can be created by having an open resource that is fairly regulated and policed – entrepreneurs should not need to worry about the insurmountable obstacles and red tape, should they decide to start an Internetbased venture. Be that venture to supply information and entertainment, or setting up a cable or wireless infrastructure for connecting citizens to the fast-expanding online world.
The markets were abuzz with rumour and speculation. Skype had been on the market for a bit and many were rumoured as suitors. Google was mentioned, as well as Facebook; both were well credentialed as purchasers of smart companies in the past. It was however another large tech company that did the deed in the end – one many considered the most unlikely. Microsoft finally bought Skype for a whopping US$8.5 billion and put paid to all the rumourmongering. Skype had revenue of $860 million and operating profits of only $264 million, which after expenses resulted in a small loss of US$7 million for the year 2010. What was of more concern to many was its long-term debt of US$686 million. The question that had to be asked was why Microsoft would buy a loss-making company with huge debt. And of even more importance was why Microsoft would pay an amount that made Skype its largest single acquisition ever. Skype has an interesting and, for some, rather chequered history. The creators of the Skype software were the founders of Kazaa, which was a peer-to-peer file-sharing application that was used to share MP3 music files, much to the horror of music companies worldwide. The founders of Skype, Niklas Zennström from Sweden and Janus Friis from Denmark, sold the company to eBay for around US$3 billion and shortly thereafter Skype reached 100 million users in early 2006. Skype became the technology of choice for anyone with loved ones overseas or who welcomed a simple and inexpensive way to communicate with anyone else who had a computer and a reasonable internet connection. The cracks began to show in 2008 with the Skype founders and eBay not seeing eye to eye on many issues, not least that the number of subscribers had plateaued, and financial metrics had not been met. In late 2007 eBay had taken a so-called "impairment", essentially a write-off, of its investment in Skype of US$1.4 billion. The marketing and the Skype product were revamped with greater focus on premium services aimed at business and consumers. These efforts resulted in solid growth throughout 2009. At this point eBay announced it would spin off Skype through an initial public offering or IPO. To cut a long story short, much legal wrangling ensued and the IPO looked somewhat uncertain. The key issue at that point was that Skype was valued at around US$2.4 billion and then they hit the big time. Microsoft bought Skype for three times its value 18 months ago. Microsoft has been in the news a lot lately and it is perhaps in this context that the purchase of Skype may make some sense. In my opinion it was an extremely strategic and well thought-out purchase. Microsoft is on a bit of a roll and has not been seen to put a foot wrong since its launch of Windows 7. After the huge failure of Windows Vista and the publicity nightmare that caused for Microsoft, the Windows 7 series – both the desktop and the new Mobile OS – have been a breath of fresh air. More fundamentally, along with the new software came a new outlook from Microsoft. Gone were the days of closed techie-based software, and in came an era of openness and apparent concern for what customers wanted from Microsoft, and what they wanted from its software. It is also clear that Microsoft realised that the future of communication was increasingly mobile and would become more and more integrated and converged. Microsoft already had a huge Skype-type service called Windows Live messenger, which offers free voice and video chat services to around 330 million active users on a monthly basis. Skype actually has around 120 million active users at any point in time, with a lower number of concurrent users than Windows Live messenger. The key differentiation here is that Skype has around 8.5 million paying users of the service whilst Windows has none. Skype also has outbound and inbound points of presence globally, allowing users to break out into traditional telecommunication networks on a global basis. In fact Skype currently is a major player in international call minutes across all networks, both mobile and fixed. These attributes alone would make Skype an attractive addition to the services that Microsoft currently offers, such as Lync, Live Messenger and various Exchange services. The other key issue is that the Skype service was predominantly a video service and with 180 million people actively using Skype to make video calls from all manner of computers and devices it was a compelling and attractive proposition, especially as more and more users are migrating to faster flexed landline and mobile platforms such as fibre to the home, and 4G LTE for mobile. Internet-based video calling is becoming one of the fastest growing sectors in communication. Microsoft is currently a bit of a slumbering giant: the bottom line is if Microsoft switched off all its current licences for all the servers and desktops out there worldwide, the world as we know it would stop. The same can't be said for Google or Apple. Microsoft has a huge portfolio of products and patents that run the entire gamut of technology, and almost all companies involved in tech today owe it some of their success – and may in fact be paying Microsoft for some technology in use in their offerings. What Microsoft currently lacks is a coherent – and may I say 'cool' – consumer strategy. The elements are there: Windows 7 on the desktop, Xbox in the lounge, Windows phone 7 emerging from your pockets, Bing pretty much everywhere, and much of the behind the scenes server technology that runs all the above. Skype represents another building block in Microsoft's determination to become globally cool and dominant once again. Mobility and converged communication is a given going forward, and despite the price Microsoft paid for Skype, and taking into account that much of Skype's technology is already owned by or could easily be replicated by Microsoft, the purchase of Skype was a canny one for Microsoft. Skype is a well-known and respected service. In the words of a noted magazine publisher: "It is personally, I think, the single most useful work tool I use in my daily life ... (It) just makes comms so easy." In a nutshell, that is why Microsoft paid what it did. Once we see Skype on our Xbox, TV, mobile phone, office phone, public phone, in fact everywhere, we will finally understand why Microsoft needed to buy Skype.
This issue of Africa Telecoms is focused on two distinct topics. That of West and Central Africa as a region and the interconnection debate. Vox has always taken an active role in interconnection discussions in South Africa. What is your opinion on the correct way to calculate a fair interconnection rate?
We believe it should be regulated, there should be one interconnection rate for both mobile and fixed, and the guideline should be 3 to 4 US cents.
Does Vox Telecom have any operations outside South Africa?
We have operations in Namibia.
Do you have any plans of expanding into the continent? If so, when would you expect to start this expansion? And in which markets would you look to start working in?
We will expand into Africa once we develop a formula that will work in major cities and once the markets liberalize further. How has the last set of interconnection reductions as set by ICASA affected Vox Telecom's revenue? Have you seen a substantial drop in costs and revenue due to the reductions?
Overall, it has had a positive effect on the Vox Group, improving our competitiveness – but it was very much a gaining on the swings, losing on the roundabouts scenario. We will have to
replace obsolete business models with new ones.
Do you think that interconnection rates are a valid cost in the telecoms space? And do you think that South Africa will ever see itself in a position where there is no interconnect cost?
Yes, the Interconnection rate is valid; and we must be careful of eroding the value chain so much that we drive away investment in telecommunication infrastructure. Also, if we have a zero cost it will result in the consumer paying for the call. This scenario will make it almost impossible to compete with any telco that has a dominant market share and cause havoc amongst the consumers.
How do you see the fixed termination rate ruling by ICASA affecting Vox's business in the next 12-18 months?
Overall it is positive, good for the consumer and good for Vox. Although I do think that South Africa should have a one price policy, I don't believe you can regulate around technology: it changes too fast and the service should be defined. For example, termination of a voice minute, not VoIP, mobile, fixed, wireless etc.
Vox has seemingly been on a big drive to convert its leastcost-routing clients (LCR) to Cristal Vox. What is the difference between the two and is Cristal Vox a higher margin earner than LCR?
The Cristal Vox margins are much better than the LCR margins (old and current) when you take into account the additional minutes captured and the inbound minutes.
Are you seeing a good conversion rate of new clients in South Africa moving onto Cristal Vox?
Yes, and we are fortunate enough to do it at a pace that suits our customers and Vox Telecom because the value proposition and margins are very similar at the moment.
What is the expected saving that a consumer can expect when moving onto your network?
Vox is a low-cost operator and thus should always provide 15 to 30% savings against the standard incumbent pricing.
Does Cristal Vox run on an entirely Vox Telecom-owned network? And what is the extent and make-up of this network?
Cristal Vox does not travel across the ADSL cloud or any other network where we do not control the quality until we switch the minutes to the destination network. ADSL voice services are branded differently.
What is Vox doing to improve the quality of calls made on its own network? Has there been a quantitative improvement on the network quality since the upgrade from Cisco to Juniper equipment? What did this upgrade involve?
We have invested extensively in carrier-class equipment, Cisco, Juniper and Alcatel; and that along with fibre and Metro E have made an enormous difference to the quality for the network. We have also heavily invested in security, load balancing, monitoring and measurement infrastructure.
Since the launch of your video-conferencing service have you seen a strong performance from this product?
Yes, so much so that we have invested further and now have some of the best skills available in South Africa in this field.
Vox Telecom has always been a company driven by innovation. What can we expect from Vox in the coming years and what is the most innovative product launched by Vox in the past 12 months?
Towards the end of the year we will technically be able to differentiate our internet and broadband offering extensively with price, billing and having the ability to tailor-make unique solutions. We are also going to attack the lower LSMs and are building a distribution network and prepaid systems along with suitable products for this end.
Has number portability had the desired effect on your corporate voice business that you expected a year ago?
No, we have had to overcome a lot of technical and routing issues that are out of our control and had to slow down our implementation. However, the strategy is sound and we are speeding up the implementation process again.
What is the current churn rate for Vox Telecom?
If we include downgrades, just under 1,4% pm.
What do you think the biggest game changer is going to be in the telecoms industry in Africa in the next 12 months?
Vox Telecom, of course
Skype is certainly making waves in the VoIP business worldwide. How do you view Skype – as a competitor or as an enabler of the technology?
Microsoft Hosted Platforms are a major part of our strategy and we welcome the integration of Skype into Microsoft's new Link Product which we aim to market shortly. Skype is also an important value add in the broadband sector.