Broadband woes hinder VoIP deployment in South Africa

Computing South Africa - JOHANNESBURG, South Africa -- While VoIP is going to introduce competition into the South African market and thereby drive down the cost of telephony, the lack of broadband adoption due to the high cost of bandwidth is still the key factor in using voice-over-IP technology.
Mike Wright, First Tuesday executive, says these were some of the points that came out of the First VoIP forum held last week.
Participating in the business and strategy panel discussion were Mike van den Bergh, managing director of Gateway Communications; Roman Hogh, M-Web business manager of product development; Lisa Thornton, an ICT lawyer; and Wayne Venter of Nortel Networks enterprise development. The forum addressed much of the hype and misunderstandings about VoIP.
It was agreed that VoIP will bring down costs, but van den Bergh pointed out that for individual businesses a critical mass of calls is an important factor in ensuring positive ROI from VoIP.
"When you are using a leased line, you need constant traffic on that line to justify the use of it. When one gets down to the lower end of call volumes, it is not a given that VoIP will save you money. A cost analysis needs to be done," he said.
In a high call volume environment like a call center, van den Bergh said that South Africa will benefit hugely from VoIP technology with many companies now likely to bring business to the country because of the cheaper call rates. "Now SA not only has the skills, language and right time zones on its side, but cheaper calls will ensure competition with the likes of India and the Philippines," he added.
The panel also pointed out in a response to a question about Telkom SA Ltd., that there had been a lot of hype about the technology, but that did not mean that Telkom will not be a major player or that its infrastructure would not be used. Thornton said that the infrastructure will still be used, since VoIP will still have to run over some kind of infrastructure. This would most likely be Telkom's.
Van den Bergh pointed out that BT Group PLC has been faced with competition since 1984, and, more recently, had to face the challenge of VoIP. "But people still buy most of their bandwidth from BT and terminate most of their calls on BT's network," he said.
While Hogh raised concerns about Telkom's control of DSL and the incumbent control of bandwidth, van den Bergh said there would be enormous political pressure

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This article was originally published by Computing South Africa. Story copyright 2006 Computing South Africa. All rights reserved.