WORLDWIDE MARKET RESEARCH REPORT - CISE

EC/IST FP6 Project No 026920
Work Package: 6
Type of document: Report
Date: 20.12.2007
File name: OP_WP6_D37_V1.0.doc Version: 1.0
Title: Worldwide Market Research Report 219 / 356
[A16] With the new regulations, South African electricity companies plan to launch a phone
service to rival state-controlled Telkom that could get landline access to almost all SA's poor
at a third of current prices. The new service would deliver voice and data via existing
electricity lines and local companies hope to launch the technology in the Johannesburg and
Pretoria area. "This could be a major leap in providing underserviced areas in (poor)
communities with telecoms at an excellent rate," Teddy Naidoo (Telecoms Manager City
Power Johannesburg) told. Although pay-as-you-go mobile phones are common even
among the poorest South Africans, only one in 10 people have a landline due to the high
prices charged by the fixed-line monopoly, and poor infrastructure. Cheaper phone and
Internet access would help slim the economic divide and slash the cost of doing business in
South Africa, encouraging foreign investors. Electricity firms say many more people in rural
areas and townships would be able to get their first landline if they could access voice and
data via power lines, which connect about 98 percent of households. City Power hopes that
other regions will quickly follow Johannesburg and Pretoria, meaning they could eventually
band together to offer a national network without relying on Telkom for long-distance calls.
City Power reckons 150,000 customers in Johannesburg and 300,000 in Pretoria (around
half of its current customer base) will either switch their phone line from Telkom or get a land
line for the first time using the new service. Initial estimates showed power companies could
offer calls at roughly a third of Telkom's current tariffs, Naidoo said.
[A15] City Power has also a very ambitious project regarding the city of Johannesburg: it
consists in the largest municipal broadband roll-out, covering 1,600 m 2 .
About 180 private sector company representatives (from telecoms and IT firms big and
small) filed into a high-level compulsory industry briefing in Riviera, Johannesburg. Nobody
dared to be absent for the briefing. It is simply too huge an opportunity to miss: the contract
for a 1,644 km 2 broadband coverage solution.
Officially named “The city of Johannesburg Broadband Network Project”, the initiative
involves the city partnering with one service provider, which must provide high-speed
Internet to Johannesburg's official population of over three million citizens.