hitting the wire*

wither the windmills?

If ever there was a time for the South African telecoms industry to pop a bottle of bubbly, it is this weekend.  Yesterday was the deadline for the Minister of Communications to lodge an appeal against the ruling in the Altech case with the Supreme Court of Appeal.  She has not and the DoC has posted this bit of PR.

The entire release is so typical of a bunch of political bureaucrats living in denial and justifying their actions with sanctimonious puffery, I'm not sure whether to laugh or throw up.  Considering the historic moment, I'll opt for a guffaw.

"...The Minister has been made the villain over the past few months for opposing Altech’s court action to obtain a network license. ..."

"...If the Minister continues with a petition, the risk is that ICASA will not be able to convert licenses by 19 January 2009 as required under the ECA, irrespective of the outcome of the petition. This will then require an amendment of the ECA to extend the license conversion period, and may effectively delay license conversion to late 2010. This result is not in anyone’s interest and will not best serve the ICT sector, operators and consumers. ..."

1st you make regulatory changes which enable self-provision by VANS and then cause total confusion by saying (the day before it is effective) that it was not your intention, then when you're challenged in court and found wanting, you appeal, lose the appeal and then decide to drop the whole matter because you suddenly have an attack of conscience (albeit a sulky one) and recall you have stakeholders who are interested in more competition and lower prices?  Ah yes, but they have things called votes do they not, and you have cope with elections next year?

I still think the main problem (as I reiterated to Lloyd Gedye of the M&G just recently) is that the DoC have never been able to communicate in a clear and unambiguous manner what their vision for the future ICT market is (assuming they have one).

One thing I do know, is that an enterprise of any sort without a clear, commonly shared vision of the future is doomed to go nowhere at top speed.  Even King Solomon seemed to know that!

I wonder which windmills will be tilted at next?

PS.

yes, the lack of an "h" after the "w" in the first word of the title of the post was originally a typo, but then I decided I quite liked the pun, so I left it! ;)

Done deal!

Today we received the final official unconditional approval from the Competition Commission for the Vox purchase of Storm.

From here, we wrap up retrenchment and redeployment processes and kick off integration processes and of course pay out monies owed for shares and options.

The long wait is over.

OK, so telecoms was fun... anyone for taking on Eskom? ;)

Storm sale.

OK.  I can finally say it.  We've sold.  And yes, it is to Vox.  

Mixed feelings.  A part of my soul will be forever attached to the Storm brand and I'm feeling a sense of loss.  But I'd be kidding myself to say I joined up to grow old with Storm.  I'm not a corporate man and I'm more suited to the chaos & stresses of Startup than the order and stresses of Corporate process and politics.

I have no idea where I will be in a few months time, but I'm quite comfortable with that.

One thing I can say is that I've learned that one can do a lot with a team of competent people who learn to trust each other and play to each others strengths.  Stormers are a great bunch & I salute the lot of you for getting us to this point.

ITWeb article(s)

Business Report article.

The press release from Vox:

Vox Telecom to buy Storm

It is official. Vox Telecom will buy Storm, one of its biggest rivals in the least-cost-routing and VoIP market.

Vox Telecom has announced its intention to buy Storm Telecom in a R360m deal. Storm Telecom provides telephony and internet services, including voice over IP (VoIP), least cost routing, international call-back, virtual private networks and internet access, hosting and security to medium and large-sized South African companies.

It has over 6,000 contracted customers and monthly annuity income of over R22 million.

Vox Telecom will integrate Storm’s telephony business into its subsidiary Orion Telecom, the data business into corporate ISP DataPro and the consumer ISP business into consumer ISP, @lantic Internet

“Storm is a major player in the voice and data markets, with a very strong VoIP platform and customer base,” says Vox Telecom CEO Douglas Reed.

“They also bring VoIP skills that are complementary to ours. The acquisition strengthens our stated strategy of establishing Vox Telecom as the preferred telecommunications alternative to the domestic incumbents. It will considerably improve our position in the VoIP telephony market and augment our corporate customer base profile and market share.”

“This is a very positive development for Storm’s customers as they will be able to still benefit from the current Storm services, but will have a further advantage from the economies of scale that the larger Vox Telecom group offers”, said Willem van Rensburg, CEO of Storm Telecom.

“There will be a seamless transition from a customer perspective, with the same products being supported by the merged entity, but they will also be able to take advantage of the other products and services available from Vox Telecom.”

“We continue to look for acquisitions that are strategic, accretive to earnings and allow us to improve our scale and strategic positioning in the South African telecommunications market”, says Vox Telecom Executive Chairman Tony van Marken. Storm is in our strike-zone and is an excellent fit with our existing businesses.”

Van Marken says the deal also offers “significant synergies once the businesses are integrated. Storm is a significant asset to add to the Group and will be a key contributor to future growth and earnings.”

The R360m purchase price is to be funded through a combination of debt and equity financing. The deal is still subject to approval by the Competition Commission and other regulatory bodies including the Reserve Bank and the JSE.

my pipe's bigger than yours!

Business Day have published an article under my name today.  I'd love to claim the word-smithing was mine and mine alone, but alas I only briefed the copywriter who has an alarming ability to mimic one's style! 

Roger, how about ghost-writing my blog from now on!  ROTFL!

Good article though - and I can say so shamelessly. ;)

There is something you can do about Telkom.

Michael Alachouzos, a New York attorney and an SA advocate, was a surprise speaker at today's iWeek 2007 Conference (presentations available here).  He has asked me to make his contact details available for anyone who is interested (see below).

Why would you be interested?  Seems Michael has extensive experience of bringing  monopolies to book through shareholder rights.  If he can get a group of more than 100 like-minded Telkom shareholders together (you only need one share), there are certain obligations that Telkom have w.r.t. being more transparent and accountable.

He is offering shares in Telkom that Mark Shuttleworth will apparently pay for!

If you want to get hold of him:

Michael Alachouzos
011-886-0191
076-818-2653
smda (at) mkohlhaas.org
64 Waterfall Avenue, Craighall, 2196, JHB

I'm intrigued!

Errata

Seems I got the bull by the udder on a few points - please see Michael's comments on this post for clarification.  The concept of getting involved as shareholders in any public entity in order to influence accountability and transparency and general good governance is a good one if time and money allow.

The regulator finds its head!

Business day reports that Karabo Motlana will start as CEO on 3 September 2007.

He's worked for CellC, Telkom and SAB, so even if he can't get his head around the telecoms Gordian Knot, he should be able to organize a good p*ss-up?

;)

I'm a little behind on regulatory issues of late, and notice ICASA have issued proposed regs for both facilities leasing and interconnect.  Both very important to the future competitiveness of the local market.

Just how how short-staffed are we?

Following up on my post of the 14th about one of the key reasons Telkom is battling to keep pace with demand, namely a shortage of skilled professionals.

ITWeb on the 17th had an article titled :

"Skills dearth quantified, says minister"

 In which it becomes apparent that the exact figures of where we lack skills is not as easily found as the minister claims.  So far, no one has been able to do more than produce a list of the groupings, which are:

* ICT managers;
* ICT project managers;
* call/contact centre and customer services managers;
* business and systems analysts and programmers;
* software and applications programmers;
* software engineers;
* multimedia specialists;
* network and support professionals;
* ICT security specialists and dimensional controllers;
* database administrators;
* telecommunications engineering professionals;
* ICT hardware technicians;
* ICT support technicians;
* electronics instrument trade workers; and
* telecommunications trades workers.

The bolding I put in there.  Now I'd like to see those figures and find out just how little rocking horse dung we do have! 

Don't buy a Nokia E65...

...or if you do/have, wrap the damn thing in cotton wool!

I fell in love with the iPhone on sight... but then realised, cute as it is, that it is right for an iPod or Apple junkie, but not the phone(?) for me.  Then I saw the Nokia N95.  And the idea of a GPS on my phone grabbed me.  Until I was then informed that the GPS was not the greatest and that I would have to pay in over R1,600 to secure this miniature PC to slip in my pocket. Mmmm...

I want :

Calendar and Addressbook synch'd with Outlook

WiFi + Bluetooth

camera for snapshots

no silly little qwerty keyboard for people with stunted fingers

predictive text

media player

browser

So I plugged that into www.gsmarena.com and spotted the Nokia E65.  Cute, powerful, meets my needs.  I went for it.

Now I've had a SonyEricsson p910i for over 2 years.  Before that a Nokia 6120 (I think it was - great phone) and before that a string of Nokias.  I prefer the Nokia interface and menu system.  I abused my previous Nokias horribly; I have been known to toss a phone across the room while gesticulating.  I abused my p910i.  It has the scars.  I never had to have any of them repaired.

Just over a week of mollycoddling my new toy (an E65), I was grumpy about battery life - having  to charge it every two days.   I was devastated to take the phone out of my pocket one afternoon to find the screen cracked.  No abuse.

Took it in and explained the context.  Asked around and got input that the screens on that model are fragile.  Was called by the shop to say that Vodacom refuse to accept that I did not abuse the phone, and I now have to fork out ~R500.00 to have it fixed.  How long will it last?  No idea.  Will I have to go through this again shortly?  Maybe.  Oh and supposedly there is nothing wrong with the battery, I must just flatten it and charge it fully 3 or 4 times and it will be right as rain.  Mmmmm...

Battery
Standard battery, Li-Ion 1000 mAh (BL-5F)

Stand-by
Up to 265 h

Talk time
Up to 6 h

Am I happy with my Nokia E65?  No.

Your mileage may vary, but consider it before you buy.

The rise of a new breed of Service Provider.

My first job in Storm, back in the late 90's was to add a Cellular LCR (Least Cost Routing) product to the International LCR product offering Storm launched with.  We were finding that we were losing deals to the likes of Orion and Telepassport because we did not offer "savings on calls to cellular".  TimWG's words to me were something of the order of "create a cellular product for us and just make sure you don't lose us any money".

None of us saw just how big the Cellular LCR market would be.  None of us realised just  how many more cellular phones than fixed line phones there would be by now.

Cellular LCR has always been a problem for the Mobile Network Operators.  The GSM networks were traditionally designed quite "thin", with some base stations only being able to handle 8 or 16 simultaneous calls from phones "passing through".  Installations of "SIM farms" or large Cellular Fixed Terminal CPE installations had the ability to "flatten" the networks in places.  An installation at PriceWaterhouseCoopers succeeded in causing dropped calls for anyone traveling past their offices in Sandton for weeks after their LCR installation went live.  The networks ended up spending many millions of capex to cater for LCR. 

Much better money was being made in charging Telkom to terminate calls originating in Telkom's network to cell phones.  But the fear of losing the LCR SIM business (and the traffic) to the other MNO network forced Vodacom and MTN to offer the likes of Storm attractive packages.  Once the LCR market had tapered off however, we saw them beef up "off-net" call charges to try and make more margin.  We had to become smarter about how we managed our base of SIMs.

Deregulation and the legalisation of VoIP has changed all of that.  Anyone who is trying to sell you on the idea that traditional cellular LCR is here for many years and it is worth committing yourself to a long term contract is blowing smoke.  The future is in aggregating traffic using either VoIP or once it is available a mix of CPS (Carrier PreSelect) and VoIP and passing traffic over interconnects.  Renewing LCR SIMs from now on is risky business.

The way forward is with the new breed of Voice&Data Service Provider (the EC Act calls them Communication Service Providers), who are geared to make most use of the changes in technology and regulations.  You just have to take a look at the M&A activity (traditional data guys buying voice guys, vice versa, and the likes of Vodacom starting their own ISP) to realise what Storm did years ago - the future is in IP.  LCR will be around for a while yet, unless either DoC or ICASA force some unwise and rather radical changes to interconnect rates.  The UK has one of the most competitive telecoms markets around, and cellular LCR is still alive with the likes of Westlake and True Communications.

Peter Walsh of DataRoom has written a good article on LCR on MyDigitalLife - worth a read if you're interested in a balanced outlook on this market.

Storm appoints a new CEO.

"The time has come the walrus said..." to appoint a new CEO (to mangle the words of Lewis Carroll somewhat.  It is time.  As difficult a decision as it must have been for both Tims to stand back and allow someone else to take Storm to new heights, it is a wise one.  To be honest, I expected them to have done it before now, but have always known they were having too much fun.  We haven't seen the last of them, but for a while at least they will be leaving the new man to get on with making his mark.

Welcome aboard Willem.  We're looking forward to meeting the challenges of growing this outfit further!

Read more here.

(oh and by the way, if you decide to Google Willem - he's not the one who invented the new condom... ! ;)