YET ANOTHER STUDY SAYS TELKOM FEES HOLD BACK SOUTH AFRICAN GROWTH

Telecoms

Fresh research into the cost of telecommunications services has confirmed that Telkom's fees are far above international norms and are depressing SA's economic growth.

Telkom's fees are up to 400% dearer than identical services in other countries - a burden on the economy that is "holding SA back", said Stephan Malherbe, a director of Genesis Analytics.

The research was commissioned by the South Africa Foundation, which represents about 15 major multinationals trading in SA and the top 50 JSE Securities Exchange SA-listed companies.

"This is not a crude bit of Telkom-bashing," said the foundation's executive director, Michael Spicer. "This is a key area in society's competitiveness and ability to grow, and clearly we haven't got it right."

The findings would support the foundation's calls for policy changes to create an environment conducive to economic growth and job creation, he said.

The most urgent calls will be for the introduction of price caps on international bandwidth and to force Telkom to offer wholesale packages so internet service providers (ISPs) can lower their own fees to end users.

Telkom's most extreme fees are slapped on its international leased lines: they are 400% dearer than the average price from 14 comparable countries and three times dearer than the next most expensive country.

Those lines are used by ISPs, by multinationals to link to branches in different countries, and by call centre operators, with the high fees preventing them from being globally competitive.

Telkom admits its fees are high compared with some operators.

"We are cognisant of the need to lower our tariffs for both data and voice services, and continue to do so," said media relations specialist Xolisa Vapi. Telkom's tariffs were cost-based and had to cover wages and equipment, but further cuts were coming, he said.

However, Genesis Analytics argues that Telkom's fees are not justified by its running costs.

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