[Kictanet] Day 8 of 10 : - Projected Impact of OFC on the Stakeholders

Wed Jan 31 16:52:11 EAT 2007

Thanks Walu for the discussion moderation.

I am doing something on the regulatory framework and will post by day 10.

On operators I would expect that there woulda  be a reciprocation in price and QOS issues.
I would expect that there would be publicly accessible interconnection agreements under the non-discriminatory  technology-neutral Open Access principles .
I would also expect that there would have to bea  busines realignment to conform with new entrants at the local lvel who the operators would indeed agree not to want to "take over" asa soon asa  a ROI looks good.

On the regulator, the paradigm shift in allowing competition and enforcing it would be key.Competition alone despite all that is siad about it is not known to benefit consumers largely where duopolies or oligopolies exits. product and price shadowing takes centre stage and one is not sure that the alternatives are not exhorbitant.

The regulator must also enforce QOS.

The consumer must be ready for a vibrant market and take up alternatives that make the best "cents".He /She must be able to walk out..and perhaps to an ombudsman(regulator) where QOS is  not as per SLA or other "promises.Whining loudly may help(See South Africans vs Telkom SA in the Daily News recently)

Kihanya

----- Original Message ----
From: John Walubengo <jwalu at yahoo.com>
To: kihanyajn at yahoo.com
Sent: Wednesday, January 31, 2007 10:11:24 AM
Subject: [Kictanet] Day 8 of 10 : - Projected Impact of OFC on the Stakeholders

I must thank all for your valuable views shared over the
last two days regarding the previous theme :- what are the
Best Models for Provisioning submarine OFC.

Three models seem to have persisted throughout the
discussion, namely, Open Access (EASsy), Private-led
(Flag), and our famous Consortium models. Where Mucheru
mentions separation of Cable ownership from Cable
Management fits in squarely with the Open Access thinking,
whereby, the investors in the cable (Govt, Public, Private
Companies) appoint an independent management Agent (at a
fee) to Operate the Cable on their behalf on a
cost-recovery, open access basis. i.e Open to current and
future Operators wishing to connect to the landing points
or invest further in the cable on equal basis).  The cable
becomes an essential service or public good, from where
Operators can compete to offer (other) Services at a
Profit.

Flag- a Private Investment initiative came in with a
variant model where the cable is –privately owned but
promises to open access to the Landing points  - but aims
to maximise returns on the investments made on the cable
infrastructure by reselling capacity at market rates.  They
also aim to play only at the Infrastructure level, rather
than at all levels, namely Infrastructure (cable) and
Services  (Network and Application), opting to leave that
to ISPs and ASP(Application Service Providers)

Nobody really pushed the Consortium model, but probably
Badru did hint strongly for such a model when he mentioned
that Commercial interest should be let loose to play
dynamically with the market forces.  The Consortium model
is where a group of Operators get into a private, closed,
commercial agreement aiming to build, own and operate a
submarine cable with aim of maximising their returns
(profit) in the shortest time possible –social connotation
notwithstanding.

And this is where the Consumer has suffered.  The
short-terms interests of investors must be balanced against
the long-term social benefits that would accrue from a
affordable bandwidth provisions.  Alex and LK seem to be
voice of the consumer here, urging the Regulator to flex
their muscle – probably now and more in future when the OFC
is laid-out. 

In all this, the various financing options were not so
pronounced as noted by Michael J. Apart from IPO
recommendation from Kai and Bill,  the financing models
(Equity, Debt, etc) has not quite come through and I hope
someone could make comment on that within the remaining
three days as we discuss our next theme:- What is the
likely impact of the above models on the existing
stakeholders (Operators, Regulator and Consumers)?  That
is, what do we see as the roles of the above stakeholders
in the new dispensation of the Optical Submarine Cable. The
efloor is again open and we have two days on this one.

walu.
Nb: a Face2Face meeting will follow up after this online
discussion where all these issues will be streamlined.
~~~~~000~~~~~~
Theme Reminder:
1) Why OFC (1day)
2) Existing Business Models for OFC provisioning (2days)
3) Existing/Appropriate Regulatory Models for OFC (2days)
4) Best Model (Business+Regulatory) for E. Africans (2days)
<Ongoing-Open>
5) Projected Impact on Stakeholders (2days)
<Pending>
6) Reconciling Stakeholder interests/Conclusions (1day)
<Pending>

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