South Africa - Telecoms Infrastructure, Operators, Regulations - Statistics and Analyses

Synopsis

South Africa’s telecom sector boasts one of the continent’s most advanced networks in terms of technology deployed and services provided. Nevertheless, the fixed-line infrastructure for many years suffered from under-investment by the monopoly incumbent Telkom, and the poor level of service encouraged the growth of the mobile sector for the provision of voice and data services. Following years of delays with its licensing, the second fixed-line operator Neotel has managed to gain market share in competition with Telkom. Although other sweeping liberalisation measures were also delayed by years, the introduction of competition changed the country’s telecoms landscape fundamentally, and resulted in lower prices for consumers. Under a converging regulatory regime, hundreds of alternative service providers have been able to enter the market to offer a range of services.

The end of Telkom’s monopoly on international submarine fibre optic cables also reduced the cost of telecom services dramatically. A new cable, expected to come online in 2017, with further increase international bandwidth and so improve services generally.

Key regulatory matters currently shaping the market include mergers and acquisitions, the licensing of LTE spectrum anticipated in early 2017, progress with the transition to digital broadcasting and the reassignment of digital dividend spectrum for mobile broadband use, the unbundling of the local loop (ULL, or LLU), and the reduction of interconnect charges.

To create more competition, the government created Broadband InfraCo, a national infrastructure company to provide cheap backbone network capacity to service providers. Broadband InfraCo ran into financial difficulties and had to appeal to the government for additional funding. The government planned to merge Broadband Infraco with Telkom, though in early 2016 Telkom withdrew from discussions.

The major mobile network operators, Vodacom, MTN and Cell C, have also moved into the fixed-line and national fibre sector under a converged, service-neutral licensing regime. In addition, many municipalities in South Africa, including the country’s largest cities, are implementing their own metropolitan fibre and wireless broadband networks. Several Fibre-to-the-Premises (FttP) deployments are underway.

All of the major players are involved in the various international submarine fibre optic cables that have reached the country in the past few years. This has brought down the cost of international bandwidth dramatically.

Key developments:

Liquid telecom secures approval for acquisition of Neotel; regulator and USAASA seek to raise ZAR100 billion for ICT projects by increasing USAF levy to 1% of operator revenue; Vox Telecom planning national long-distance fibre network in eastern areas; Telkom acquires BCX; Liquid Telecom acquires Neotel for ZAR6.55 billion; work begins on the Modderfontein Smart city development; Constantia Fibre Initiative (CFI) to build an open access FttP network in Cape Town; Vodacom contracts Alcatel-Lucent to build a GPON FttP converged network.

Companies mentioned in this report:

Telkom, Neotel, Vodacom, MTN, Cell C, Virgin Mobile, Broadband InfraCo, Transtel, Eskom, SEACOM, Telkom, Neotel (Tata), Vodacom, MTN, Broadband InfraCo, Transtel, Eskom, SITA, Sentech, SEACOM, Dark Fibre Africa (DFA), Internet Solutions, FibreCo, eFive, WASACE.

Table of Contents

  • 1. Synopsis
  • 2. Key statistics
  • 3. Country overview
  • 4. Telecommunications market
    • 4.1 Historical overview
  • 5. Regulatory environment
    • 5.1 Historical overview
    • 5.2 Network rollout obligations
    • 5.3 Regulatory authority
    • 5.4 Telecommunications Amendment Act
    • 5.5 Regulation of Interception of Communications Act 2002
    • 5.6 Electronic Communications Act and ICASA Amendment Act
    • 5.7 Converged licensing regime
    • 5.8 New Companies Act
    • 5.9 Universal Service and Access Fund (USAF)
    • 5.10 Interconnection
    • 5.11 Registration of subscriber details
  • 6. Telecom sector liberalisation
    • 6.1 Overview
    • 6.2 Privatisation of Telkom
    • 6.3 PTN licences
    • 6.4 The ‘Big Bang’
      • 6.4.1 Value-Added Network Services (VANS) providers
    • 6.5 Under-Serviced Area Licences (USALs)
    • 6.6 InfraCo licences
    • 6.7 Number Portability (NP)
    • 6.8 Carrier pre-selection (CPS)
    • 6.9 Local Loop Unbundling (LLU)
    • 6.10 International gateways
    • 6.11 Least Cost Routing (LCR)
  • 7. Fixed network operators
    • 7.1 Telkom
    • 7.2 Neotel
  • 8. Telecommunications infrastructure
    • 8.1 Overview of the national telecom network
    • 8.2 National fibre infrastructure
      • 8.2.1 Broadband InfraCo
      • 8.2.2 Dark Fibre Africa
      • 8.2.3 FibreCo
    • 8.3 International submarine cables
                • 8.4 Satellite
                • 8.5 Next Generation Networks (NGN)
                • 8.6 Municipal networks
                  • 8.6.1 Knysna – Africa’s first municipal network
                  • 8.6.2 City of Tshwane
                  • 8.6.3 City of Johannesburg
                  • 8.6.4 Ekurhuleni (East Rand)
                  • 8.6.5 City of Cape Town
                  • 8.6.6 eThekwini (Durban)
                  • 8.6.7 Gauteng Link
              • 9. Data centres
              • 10. Smart infrastructure
                • 10.1 Smart cities
              • 11. Related reports
              • Table 1 – Country statistics – 2016 (e)
              • Table 2 – Fixed-line network statistics – 2016 (e)
              • Table 3 – Internet provider statistics – 2016
              • Table 4 – Internet and broadband statistics – 2016 (e)
              • Table 5 – Mobile statistics – 2016 (e)
              • Table 6 – National telecommunications authorities
              • Table 7 – Telecom sector value added revenue and contribution to GDP – 2010 - 2015
              • Table 8 – Telecom sector investment – 2015
              • Table 9 – Telecom sector retail revenue by service – 2015
              • Table 10 – Telkom principal shareholders – March 2016
              • Table 13 – Fixed lines in service and teledensity in South Africa – 2000 - 2017
              • Table 14 – South Africa’s international internet bandwidth – 2000 - 2015
              • Chart 1 – Fixed lines in service and teledensity in South Africa – 2005 - 2017

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