Cheaper calls for call centres?
17 November 2006The South African government is hoping to get the "buy-in" of state telecoms firm Telkom as it seeks to create an enabling environment for the business process outsourcing (BPO) industry in the country.
Speaking to journalists in Cape Town on Monday, Trade and Industry Minister Mandisi Mpahlwa said the high cost of telecommunications in SA stood in the way of the country's becoming a key international location for the burgeoning international call centre industry.
The government is not looking at providing direct incentives to Telkom, Mpahlwa said, but at "buy-in in terms of what we see as enormous potential for South Africa".
At the same time, a model of "developmental pricing" in telecommunications, similar to that developed for the electricity market, was being explored which could see a system of favourable pricing for large-scale investments being introduced, Mpahlwa said.
While the government "can't just instruct Telkom what to do," it would be using its position as a major shareholder in Telkom to exercise its influence on the telecommunications giant, the minister said.
He also urged the country's telecommunications operators to consider the benefits of the volumes of traffic that would be generated should business process outsourcing take off properly.
Increased competition resulting from the launch of the country's second fixed line operator, Neotel, is also expected to bring down telecoms costs.
Competition is also expected to be enhanced as more broadband projects come on stream in SA and as the Eastern Africa Submarine Cable System (EASSy) takes off, with seven countries having signed the Nepad protocol for the project and more expected to sign it by the end of the year.
Broadband projects include that of state-owned signal distributor Sentech, whose business plan on the rollout of wireless broadband to the Department of Communications has been finalised.
And from March 2007, mobile operators will be authorised for self-provisioning of international connectivity, while municipal ICT broadband is to be linked to USALs - so-called under-serviced area licencees - by July 2007.
At the same time, Infraco, a new entity focusing on the provision of broadband infrastructure, has come on stream, reporters were told.
According to Mpahlwa, the SA government sees it as "exceedingly important" to address the question of telecommunications pricing, regards it as a "major challenge" to its ambitions to turn the country into a desirable location for business process outsourcing.
Growth in the sector has been projected as being "quite huge" over the next five years, the minister said, aided by the country's favourable time zone, especially for the European market, and the large numbers of people in the country who speak fluent English.
However, the government was also looking at a range of possibilities "beyond business process outsourcing" as it planned ahead, and aimed to get "something broader" out of the worldwide growth in the industry.
Mpahlwa did not elaborate on this, apart from saying that South Africa had an advanced financial services industry with suitable depth for international competitiveness, and urging telecommunications companies to "think bigger and further forward," weighing up the possibilities that would exist further down the line.
Source: BuaNews
