Thesis (MBA)--Stellenbosch University, 2006. / From the 1990s onwards, significant developments have occurred in the international
telecommunications sector that have affected the South African telecommunications
industry and peoples' access to the telephony. Rapid developments in Information
and Communication Technologies together with the reorganisation of
telecommunications operators through commercialisation, privatisation and market
liberalisation have resulted in monopoly operators moving away from their public
service mandates. Globalisation and adherence to World Trade Organisation rules
are causing operators to rebalance their tariffs, long-distance rates are decreasing
while the cost of local calls is increasing. High-end users of telecommunication
services are benefiting while low-end, largely residential users are being priced off
the network. The end result is a negative effect on universal access to
telecommunications.
This study examines the extent of telecommunications reform within the South
African telecommunications industry as it affects the provision of telecommunication
services and the government's goal of achieving universal access in South Africa.
Quantitative research methods utilising secondary data were utilised to establish that
the state owned operator, Telkom, has transformed itself from a public service
operator to one that is fully commercialised and prepared for competition.
This study finds that despite the large roll-out programme in fixed-line
telecommunications, there has been only very limited uptake for rural and low-income
users. Although Telkom's exclusivity period initially caused an acceleration of the
growth in net new lines from Telkom's greater investment levels, this acceleration
only lasted until 2000/1 when Telkom started to enforce timely accounts payment
more strictly. This resulted in an actual decrease in the total number of active lines in
2001 and 2002, despite new lines being rolled out. Household figures suggest that
low-income households disconnected in large numbers.
Fixed line telephony access was given to people who could not afford telephones
and hence they were later disconnected. The end result was that fixed lines ended
up growing at a similar rate to what they were prior to the exclusivity period,
suggesting that the grand subsidisation of universal access was most likely a waste
of resources and only resulted in temporary ownership improvements.
A further problem now faced by government is the number of people who were
disconnected from Telkom and remain indebted to the company. These households
are prevented from getting a fixed-line phone until they repay their deb!. This has
potentially far-reaching effects on their lives through destroying their credit rating.
In contrast to fixed line telephones, the growth in cellular subscribers has grown
beyond all expectations. Almost all the gains in ownership have come from the
adoption of cellular by rural and low-income users. This study demonstrates that
cellular is the rational choice for most low-income consumers given the different tariff
structures and the average monthly spend on communication.
The study further suggests that future use of universal service funds should be more
technology neutral, this will enhance the role of cellular telecommunications in such
plans. Removing the burden off fixed line for universal service provision may enable
the acceleration of telecommunication liberalisation in South Africa.
Obvious benefits are better prices and products for business users. Fixed-line
technology remains the core technology for business users who require bandwidth
for data services and make considerably more calls than residential users, making
fixed-line the cheaper technology. Amongst the current biggest users are cellular
network operators. Improving prices on leasing and interconnection should lower
cellular call rates, making it even more attractive to low-income users.
Finally, the new Intemational Telecommunication Union definitions for universal
access and service now include cellular technology and move away from a fixed-line
focus. These definitions are very much in line with the results identified in this study.
| Identifer | oai:union.ndltd.org:netd.ac.za/oai:union.ndltd.org:sun/oai:scholar.sun.ac.za:10019.1/50660 |
| Date | 03 1900 |
| Creators | Gregory, Angela Stuart |
| Contributors | Fourie, Louis C., Stellenbosch University. Faculty of Economic and Management Sciences. Graduate School of Business. |
| Publisher | Stellenbosch : Stellenbosch University |
| Source Sets | South African National ETD Portal |
| Language | en_ZA |
| Detected Language | English |
| Type | Thesis |
| Format | 159 p. : ill. |
| Rights | Stellenbosch University |
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