Competition and Regulation in the Telecommunications Industry in ...

Competition and Regulation in TelecommunicationsTable 3.1: Rollout Targets for Telkom in terms of License1997/8 1998/92001 2002 Total1999/2000Total new access lines 340000 435000 575000 675000 665000 2690000bought into serviceNo. in under-serviced 265000 318000 359000 357000 378000 1677000areasNo. for priority 3240 3845 4055 5060 4046 20246customersNo. of villages served 510 610 610 800 644 3174No. of payphones 20000 25000 25000 25000 25000 120000No. of replacement lines 20000 13000 65000 551000 603000 1252000Source: JEDPIn addition to these rollout targets, Telkom is committed to upgrading thenetwork and its service record. This involves upgrading the entire network todigital by 2000, lowering the waiting period for installation, lowering thenumber of faults per 100 lines and reducing the time to fix faults. The licencealso allows for restrictions on price increases introduced by Telkom to ensurethat its monopoly position is not abused during the exclusivity period. Theseare set for a bundle of services (including local, long-distance andinternational) and are restricted to the CPI -1.5% for the first three years, afterwhich SATRA will set price caps.The White Paper on telecommunications suggested that once exclusivity hasended, then initially the local loop should be open to entry with operatorsconnecting to the PSTN of Telkom (see figure 3.1). The thinking was thatentry was unlikely anyway but co-operative organisations or SMMEs might bewilling to connect specific communities and so be encouraged. After a furtheryear, it was envisaged that a full switching network could be licenced incompetition to Telkom, providing the local exchanges too. The exact shape ofderegulation is currently under review. However, the timing of issuing asecond PSTN licence is bound in the WTO and must be complete before theend of 2003.30