Telkom South Africa prepares for competitive fiber future

By ROBERT PEASE

With deregulation not far off, Telkom South Africa will deploy Newbridge Network`s Asynchronous Tranfer Mode (ATM) networking equipment within its Synchronous Digital Hierarchy (SDH) fiber-optic backbone in preparation for a competitive market. The initial multimillion-dollar agreement covers a two-year period with an option to extend the relationship to 10 years.

Newbridge will provide its MainStreetXpress 36170 Multiservice ATM Switch in the initial upgrade phase, along with the MainStreetXpress 46020 suite of network-management products to provide network- and service-management capabilities. The new broadband upgrade had far-reaching significance for Telkom South Africa, a private company that is wholly owned by the South African government. With the probability of deregulation taking place in three to five years, it`s critical for South Africa`s incumbent carrier to solidify its position by offering cutting-edge technology and services.

"Telkom has appointed a strategic equity partner to assist them in meeting some of the objectives they have," says Andy Bull, director of South and Central Africa for Newbridge Networks. "Essentially, the equity partner is a consortium between Southwestern Bell, or SBC, and Malaysia Telecom."

SBC and Malaysia Telecom hold 30% of Telkom South Africa, with the government controlling the other 70%. "Telkom South Africa is cementing its position in the South African market with this broadband network venture and gearing up for the competitive threat that will eventually come," adds Bull.

In light of telecommunications technology, Bull describes South Africa as a "hybrid first-world/third-world country." On one hand, there is the forward-thinking business community that uses a lot of leading edge technology and requires first-world communications capability. Then once into some of the rural areas of the country, telephones become very difficult to locate.

"It`s a complete dichotomy between very first-world technology in communications and a lot of third-world areas," says Bull. "This is common to many areas of Africa, and we`re no exception in South Africa."

Telkom South Africa is in the unenviable position of making it their responsibility to get telephone service into every South African home, while still protecting its lucrative business clientele. Once deregulation occurs and alternative carriers enter the new market, the focus will likely be on the more-profitable business market, leaving Telkom South Africa carrying all the less-profitable rural business.

So with deregulation still a future issue, Telkom South Africa is poised to deliver next-generation services on a core ATM backbone that interconnects the key business centers of Johannesburg, Cape Town, Durban, Pretoria, Port Elizabeth, and Bloemfontein.

"When we look at the technology being deployed and the potential services that can be offered over this new network architecture, it`s in line with what a lot of the regional Bell operating companies (RBOCs) are doing in the U.S. and what major European carriers are doing," says Bull. "So it really puts Telkom South Africa, from an ability and service-delivery perspective, in line with first-world carriers."

Other technologies, such as dense wavelength-division multiplexing (DWDM) are also expected to find their way to South Africa, probably much sooner than expected by many in the industry. Telkom South Africa is already taking a hard look at DWDM as a technology to be deployed in its transmission infrastructure.

"To try and put it into perspective, South Africa may not be as leading edge as the U.S.," says Bull, "but I`d suggest to you that we`re not a million miles behind either. I`d say that the lag of South Africa to the U.S. is only about two years, from an adoption-of-technology point of view."

As in other countries, business data services are the major drivers for integrated services in the business communities within South Africa. Although some narrowband legacy networks already exist, such as frame relay, the country feels the need for a ubiquitous network capable of delivering integrated services from a single platform with a single management architecture. Such a network, Bull believes, will enable the country to have both speed of delivery and ease of maintenance.

The first phase of the network upgrade, to overlay the Synchronous Digital Hierarchy backbone with ATM, is already underway, with service expected sometime in the first quarter of 1999.

Newbridge is involved with the implementation process from a high-level technical support aspect. Its channel partner, PQ Networks, will complete the actual installation. Although Newbridge will assist PQ Networks with some of the integration and management-system issues, its operation in South Africa is focused mostly on sales and marketing.

Bull and others believe South Africa represents a "springboard" into Africa for new future telecommunications technology opportunities. It is, say sources, undoubtedly the leading proponent of technology on the African continent with a very sophisticated customer base.

"We often find that, in fact, the adoption of new technology will happen here before it happens in some of the major European countries," says Bull. "So although South Africa may not be on par with the U.S., we are ahead of large sections of Europe in the adoption of technology. Opportunities exist throughout Africa in both the telecommunications operator market and the enterprise network market." q