Johannesburg - The roll out of the second national operator (SNO) is expected to help the business processing outsourcing (BPO) or call centre industry, Standard Bank economist Elna Moolman said about the awarding of a 25-year licence to the new telecommunications player.
Telkom - which was until December 8 2005 South Africa's only public switched telecommunications service (PSTS) licencee - has in the past been accused of charging higher tariffs than other countries such as India which is seen as a major competitor to South Africa in the global BPO market.
Telkom's high charges were seen as a disincentive to some investors who chose less-expensive destinations than SA.
Moolman noted that the government had already identified the BPO sector as one of the platforms that would help towards the government's accelerated and shared growth initiative.
"SA isn't competitive as our prices are too high. If you want to attract the BPO investors, lower the prices," she said, noting that the lowering of prices by the SNO will also have a ripple effect across the economy given that telecoms sector is one of the growth drivers.
Tracy Cohen of the Independent Communications Authority of South Africa (Icasa) said the regulator would also be looking at creating a conducive environment for the contact centre by removing barriers - including costs.
BMI- TechKnowledge analyst Brian Neilson said of the SNO's household impact: "Even though the SNO may choose to focus on business customers initially, I believe that consumers may feel the difference very soon after the commercial launch, mainly due to the impact on the wholesale pricing in the market, especially on services purchased from Telkom currently by ISPs (Internet service providers).
"These reductions would inevitably also be passed on to consumers, including individual household subscribers. This would apply immediately to services such as broadband internet access, and ultimately also lead to cheaper residential voice calls."
The Organisation for Economic Co-operation and Development expects the operator to offer the residential market slightly lower tariffs than what the incumbent currently offers. Although the SNO is required to file its tariff structure with Icasa before commencement, unlike Telkom, it will not be obliged to follow a set price framework.
But according to the South African Chamber of Business (Sacob), the SNO - under leadership of Karl Socikwa in the interim - will have no impact short term impact for users.
Cohen and Moolman believe that the duopoly is a path towards lower telecom costs in SA, while Sacob economist Bill Lacey warned that some theories suggesting that duopolies yield lower rates have been overturned.
To ensure competitiveness, Neilson suggested the authorities should ensure that interconnection and facilities agreements between SNO Telecommunications and other operators are "effectively and speedily implemented."
Communications Director-General Lyndall Shope-Mafole said the state was in a process of drafting guidelines towards a more competitive environment.
The Tata Group-led second operator will pay a R100m licence fee. Its shareholder base includes state-owned Eskom and Transnet telecommunication arms with a joint 30% equity, while empowerment partner Nexus Connexion holds 19%.
The remainder is in the hands of SepCo members: Tata Africa Holdings with 1% and Mumbai-listed VSNL with 25% - both entities are part of Tata Group.
CommuniTel - which consists of Telecom Namibia, Gateway and T-Systems - owns 12.5% in the SNO and so does Two Telecom Consortium, which is made up of Blue Planet, SwedeTel and others.