Business Times

SLT's IPTV investment and ADSL services


The Business Times of August 15 reported that the SLT is re-examining its IPTV investment while at the same time SLT mailed post cards in a frantic hurry to its customers offering IPTV connection free of charge - though several years after it was launched.

It is interesting to note that experts forewarning "of the regulator of the IPTV investment pointed out that like the SLT's ISDN services, it would be an imminent failure. They urged the Regulator to open up the cooper loop, as practiced by other liberalized markets, for competition to harness its yet untapped vast idling latent bandwidth which has no shelf value" - during a meeting to explain the flaws of the post November 2007 tariff, another fiasco of the Regulator that will bring about the demise of fixed line services.

Clearly the SLT is now trying desperately to find a scapegoat. IPTV services were launched essentially to make use of the vast idling untapped bandwidth being available for other parties (called unbundling the local loop, a practice done in well established telecom markets), so as to promote competition in wire based broadband ADSL services -the cheapest and ubiquitous of available broadband technologies. The intentions of the Regulator of this country is just the reverse of these well established telecom markets.

A case in point is the United Kingdom. The British Telecom, the incumbent service provider who owns the copper loop, resisted to the hilt the efforts to unbundle the local loop (ULL). Today the growth in broadband in UK is phenomenal because of the unbundling enforced by OFFCOM the UK Regulator, a lesson for implementers of the Mahinda Chintana Idiri Gamana.

It is pertinent to reveal material in the OFFCOM Communication Market report, the number of premises with access to unbundled local loop rose from 66.6% to 82.6% in Q1 2008; and by June 2008 almost half of all unbundled exchanges had four or more providers in them.

The continued rolling out of 8 Mbit/s services across its network with LLU operators unbundling more local exchanges has driven up the average blended headline speed across the UK from 3.6 Mbit/s in December 2006 to 5.9 Mbit/s at the end of Q1 2008 nearly 12 fold faster than that of Sri Lanka.

In contrast, the speed SLT offers for its basic package is barely 512 Kbps. It exploits the subscriber's need for the continued use of broadband by offering a volume limited package to extort payments for extra volumes of data in excess of the limit. In the case of the volume unlimited version of the basic speed the speed is throttled to the hilt to limit the monthly usage below the needs of the user -much like the dilemma in Charles Dickens' Oliver Twist.

Had the regulator been heedful to the forewarning, the SLT would be earning a steady lucrative cash flow, in making available the latent bandwidth to other service providers, thereby averting the losses incurring from the IPTV investment. It will also boost significantly its monthly revenues which is alleged to be inadequate to offset its expenses though the SLT, through its subsidiaries, enjoys a lucrative mobile market as well. It is not so in UK, where BT does not have its own mobile network, the only one of its kind in the European Market exposing its vulnerability to fixed mobile substitution.

Competition also means lower bills for consumers. According to OFFCOM research the average price £23.30 per month in the last quarter of 2005 has dropped to £13.61 by 3Q 2009. Likewise in USA too ADSL connections at speeds of 3Mbps are offered even to remote villages at US$ 14 per month with a free of charge high quality wi-fi modem costing about US$ 80 in the market. The FCC, the US regulator, has launched several years ago a free broadband speed test to enable the user to check the speed. This isn't just a free public service; the FCC stores the test data to help to form its national broadband strategy.

The foregoing practices of the Regulator tantamount to contravention of the provisions of the clause 5 of the Telecom Act, in particular its sub sections (d) and (n) which are quoted verbatim below (d) to pay due regard to the public interest and the convenience and wishes of the general public as regards the telecommunication services provided by an operator ; (n) to require any operator to submit to it transmission plans, signaling plans, switching and numbering plans and to approve or modify such plans as well as to publish and ensure compliance with such plans;

Clause 5 reveals the need for the Regulator not only to uphold the public interest, but the convenience and wishes of the general public with respect to telecom services in order to serve all its stake holders in a just and fair manner.

The impression one gets is that the Regulator has ignored blatantly these requirements thus not satisfying the pre-requisites to form strategic decisions. Therefore logically it seems clear that opportunity is created for decision making devoid of accepted scientific and engineering norms thus permitting the influence of rent seeking interests to undermine the aims of the Mahinda Chintana, mislead the President (who is the Minister in charge of the subject), destabilize the market sacrificing the public interests and wishes.

It is hoped that those close to the President particularly the bureaucrats who daily seek audiences, would advice to take corrective steps so that the telecom sector is reformed to enable the realization of the Mahinda Chintana. A telecom specialist

Top to the page  |  E-mail  |  views[1]
SocialTwist Tell-a-Friend
Other Business Times Articles
New law to replace BOI Act
Value is key for SL over others: Taj Hotels MD
CB to relax exchange control rules
Top securities regulator visits Colombo
Budget: Growth with equality-urges Colombo business leader
Sri Lanka to consider reptile exports to Germany
Comment -Budget: Onus on taxes
Feature - Friday Forum outlines the path to national unity and reconciliation
Tourism strategies at provincial level
CPM annual conference slated for October 11
Gotabaya outlines war-winning strategy now applicable for economic war
250,000 computers dumped in Sri Lanka every year
India setting up 1,500 universities, China creates one every week
Design for economic growth
Leo Burnett’s Ranil wins a Global Medal of Merit from IAA
Lankaputhra Bank’s non-performing loans increase
Saberion offers alternative to commission based bookings
Janashakthi introduces Sri Lanka’s first 24-hour vehicle breakdown policy
Phoenix Jt. MD at O&M New York
Add 1% for North / East development in 2011 budget: Business leader
US Business Leaders meet President in NY
Central Bank $1 bln bond offer exceeds $6 bln in 14 hours
SLT's IPTV investment and ADSL services
Sri Lanka to use nuclear energy for commercial purposes
Agni Capital leads in driving foreign investments to SL
Fitch revises SLT outlook
Dedicated IPR UNIT of CID soon
Central Bank directs The Finance Company to seek new investors
Government introduces new procurement procedure for state institutions
Plenty Foods wins silver award at Farmer awards event
Ceylinco Life to present Rs 8.4 mln in new scholarships at 10th Pranama event
Sri Lanka's first 3D mobile game 'Colombo Ride 3D' opens in Oct.
Costs from interest free credit cards offers come from merchant’s commissions
Shortage of shares in Colombo market prompts SEC action
Microsoft EDI system for Brandix and Marks & Spencer
Eagle Logistics turns five
Dilmah founder felicitated as 2010 Brand Icon
Mandatory deposit insurance, drop in performing loan loss provisions by CB
Multi Finance to list on the Colombo Stock Exchange
Stepping up on Corporate Governance practices key to investment
SEC in a move to bring commodity exchange, exchange traded funds, unit trusts in 2010
CSE boom hasn’t reached remote areas; banks still rule
SEC prepares takeovers-mergers law
SEC wants to harmonise regulation with the region
SEC, CB rules bring in new business for banks
Hayleys and employees donate IT Centres to Northern schools
SMB Leasing to raise Rs 581 million from rights issue
NDB Bank launches an island-wide Savings Drive


Reproduction of articles permitted when used without any alterations to contents and a link to the source page.
© Copyright 2010 | Wijeya Newspapers Ltd.Colombo. Sri Lanka. All Rights Reserved.| Site best viewed in IE ver 6.0 @ 1024 x 768 resolution