by Stuart Hardy, Business Unit Manager of EOH’s Carrier and Network Solutions Division
“The Internet is the most powerful and pervasive platform on the planet. The Internet has replaced the functions of the telephone and the post office. The Internet has redefined commerce, and as the outpouring from four million Americans has demonstrated, the Internet is the ultimate vehicle for free expression,” United States Federal Communications Commission Chairman Tom Wheeler said when the American government voted to enforce net neutrality.
The US leads the world in broadband penetration, with 94 978 000 fixed line subscribers and 318 781 000 wireless broadband connections as of June 2014, covering 87% of the population of the country. In contrast, South Africa has a 3.1% fixed line penetration rate, with 33.3% of the South African population having Internet access, according to the South African Department of Communications’ presentation to the Portfolio Committee on Communications in 2013.
Unlike more developed countries like the US, South Africa still has a long way to go to enable the government’s goal of 100% broadband connectivity by 2020. Similarly, while our infrastructure and networks are as technologically advanced as those anywhere else in the world, reaching our widely spread population makes high level penetration financially challenging.
First tier operators in South Africa
While there are a multitude of smaller providers, there are currently only seven first tier service providers locally, including Telkom, IS and EOH Network Solutions. Over the last fifteen years, the definition of what constitutes a first tier operator has not changed. However, due to regulatory and technology changes, the definition has evolved to include new infrastructures.
An organisation that runs L2 or MPLS services by leveraging an upstream provider in the same country cannot be seen as an independent first tier provider. The main reason is due to the provider not being in complete control of their network nor the bandwidth they use on the network. Therefore a true first tier provider should be purchasing services at an SDH level, or laying their own Dark Fibre.
Requirements of a first tier operator
To be considered a first tier operator, service providers must fulfil a number of basic requirements.
Firstly, a first tier provider must operate a national core backbone. The first consideration is the design, build and operation of a private core national network, without which no other services are possible. While this does not require a service provider to lay their own national fibre, it does require them to purchase at a level of SDH or Dark Fibre. This national core has to include no less than nodes in Johannesburg, Cape Town and Durban.
Secondly, the company must operate a national peering network. A first tier provider will bilaterally peer with other first tier providers in the market. This needs to be on a settlement free basis.
In addition, first tier providers must operate an international SDH network, or take delivery of an SDH service, where they terminate such services in a node in the UK or US which is deployed and managed independently. Also, first tier providers must operate a national voice interconnect network with other first tier providers.
A more recent introduction to this requirement has been voice delivery, whereby a first tier operator needs to deliver its own voice minutes to other providers via voice interconnects. Similarly, as an evolution of the national core network, metro rings are essential for first tier providers to build and deliver their services. While almost all providers leverage other last mile suppliers, the majority of the last mile backhaul is done on their own metro core. These recent additions are seen today as essential in deploying and operating a first tier network.
Stuart Hardy has been in the ICT industry since 1997, has been in the Telecommunications industry since 1997, intimately involved in product development, operations and product marketing roles. He has held Executive level positions in some of the largest Operators in South Africa and has founded and driven two successful start-up companies in the Mobile data and Wireless networking spaces. Today, Stuart is a Divisional Director for EOH in their Telecommunications sector.