Fin24

Vox banks on number portability

2010-04-22 17:44

Johannesburg - AltX-listed Vox Telecoms said on Thursday that the announcement by the Independent Communications Authority of South Africa (Icasa) that local number portability was going live would help Vox be more competitive. Number portability allows users to switch from Telkom while retaining their phone number.

CEO Tony van Marken said his company had been stifled in its fixed-line business before as customers have been loath to lose their telephone numbers.

"Up until now we could show them a solid business case whereby they would save 20% by switching to us for fixed-line services - so the business decision was easy. But if they have to change their phone number it's inconvenient and most would not be willing to switch," he said.

"But now with local number portability going live we expect more success going forward."

Icasa has announced local number portability will be available from April 26. Mobile number portability is already active in South Africa, allowing subscribers to switch between cellular network providers without having to change their number. The same is now true for fixed-line numbers.

"We see the introduction [of local number portability] as quite a big step forward in SA's telecommunications environment," said Van Marken.

"This will have a more positive impact on lower prices than the drop in interconnect in many respects. It allows for complete freedom of movement between networks and this will drive competition and lower prices," he added.

Managing director of World Wide Worx Strategy, Steven Ambrose, said that the impact of local number portability might not be massive, however.

"Number portability for mobile was a big non-event. We predicted that about 8% of subscribers would change networks as a result of being able to keep their number. The real number turned out to be closer to 1%," he said.

"The big issue in SA is that there is actually no comparable service to Telkom. Only Telkom can physically bring a cable into your premises. So for VoIP (voice over IP) services you need fibre or Telkom," he added.

"Fibre from other providers [not Telkom] is coming, but it's focused on large corporates and business initially."

"Vox plays in this space and will be able to gain some smaller corporate business, but this is highly competitive and there is a very small pool of potential customers," said Ambrose.

"I don't believe it [local number portability] will be a big driver of cost either, because that only happens if more customers are using VoIP, and that relies on a solid broadband connection, which again means dealing with Telkom for ADSL. If Neotel had really played the game and had the infrastructure required and were ready to compete then it would be a different story. But they aren't."

- Fin24.com