Neotel promises cheaper Bandwidth from Deal with Seacom

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New operator Neotel is promising to shake up SA's moribund telecoms market by introducing cheap high-speed international bandwidth as a key partner in a privately funded undersea cable.

Bandwidth fees could be slashed by up to 80% compared with the price of satellite connections once Neotel is using the Seacom cable, which will link SA and east Africa to Europe and India. As well as offering lower prices, Neotel's deal with Seacom nicely sidesteps a legal quagmire threatening to cause further delays to the government-backed but delayed Eassy cable.

The new deal will see Neotel own Seacom's landing station and operate the facilities in SA. It will sell that bandwidth to other voice and data carriers such as internet service providers, livening up the market for international bandwidth that Telkom has dominated for years.

The 13 000km cable will run along the east coast of Africa and through the Red Sea, with landing points in Mozambique, Madagascar, Tanzania, Kenya and the United Arab Emirates before it terminates in Italy. It will also link to Johannesburg to ease SA's national bandwidth bottleneck and let customers hop on to the cable from the city.

No early price relief is in sight, however, as construction will begin only later this year with switch-on due in early 2009. Even so, that will be far sooner than the Eassy cable will materialise.

(Source: Business Day)