The Interconnect Rate and its Importance in South Africa’s Telecommunications Market

Over the past 20 years, making calls in South Africa has changed considerably as we progressed from legacy analogue technology into the digital age using Voice over IP.  At the same time, the regulatory landscape has undergone a number of changes to ensure that legislation keeps up with technology’s pace of change One of the biggest factors for regulating the market and how operators price calls,  has been the evolution of the interconnect rate. 

The interconnect rate or the tariff one operator charges another to terminate a call on its network, affects all parts of the telecoms industry – mobile and fixed-line operators, corporate businesses and the everyday consumer.

The history of the interconnect rate

The history of the interconnect rate has not only shaped the telecoms industry as we know it today but affected the South African economy as a whole. In 2010, the mobile interconnect rate was R1.25 and today it’s sitting at R0.09c

In 2010, the interconnect rate was so inflated, that it was extremely expensive to call any of the mobile networks. Because of this, Least Cost Routing (LCR) existed, which connected business telephones to sim card devices that allowed you to make calls to mobile networks at substantially reduced rates. 

By using LCR, businesses could avoid the interconnect rate and make on-net calls (MTN to MTN or Vodacom to Vodacom).  The result was a vastly cheaper per minute rate. However, as the interconnect rate started to drop, so LCR was no longer needed.  

VoIP soon followed where you could use data links like ADSL, Diginet and later fibre to send calls over direct interconnects. This created a gap in the market for smaller Value Added Network Service Providers to enter the market and provide telecom solutions at far better rates than the larger incumbents.

Through a combination of the reduction in the interconnect rate, a growing variety of VoIP services and better connectivity solutions, VoIP has now become the favoured method of carrying calls across corporate South Africa.

The table below shows how the interconnect rate has changed over the last few years:

Start Date End Date Mobile Fixed Regulated Fixed Asymmetry
Regulated Asymmetry Local National Local National
01-Mar-12 28-Feb-13 0.40 0.44 0.19 0.12 0.13 0.21
01-Mar-14 30-Sep-14 0.20 0.44 0.12 0.16 0.13 0.21
01-Oct-14 30-Sep-15 0.20 0.31 0.12 0.15 0.18 0.21
01-Oct-15 30-Sep-16 0.16 0.24 0.11 0.12 0.15 0.16
01-Oct-16 30-Sep-17 0.13 0.19 0.10 0.10 0.12 0.12
01-Oct-17 30-Sep-18 0.13 0.19 0.10 0.10 0.12 0.12
01-Oct-18 30-Sep-19 0.12 0.18 0.09 0.09 0.10 0.10
01-Oct-19 30-Sep-20 0.10 0.16 0.07 0.07 0.08 0.08
01-Oct-20 30-Sep-21 0.09 0.13 0.06 0.06 0.06 0.06
Interconnect Rate South Africa
The voice interconnect rate in South Africa since 2012

How does the interconnect rate impact the telecoms industry in South Africa?

The interconnect rate, which is regulated  by ICASA (Independent Communications Authority of South Africa), has been lowered over the years to:

  • Lower telecommunication costs.
  • Allow more providers to enter the market and stimulate healthy competition which leads to reduced costs and improved offerings.
  • Ensure transparency in providers to help consumers make better choices for their usage.

Impact on the everyday consumer

Despite all this, South African consumers are still charged far too much to make a call. Despite the interconnect rate consistently dropping over many years, these savings have not been passed on to the consumer.   According to the glide path issued by ICASA, the interconnect rate is anticipated to be reduced to 9c in October 2020 and as this downward trend continues, the pressure on mobile networks to reduce call rates needs to be heightened. In addition, the increase in application calling through platforms like WhatsApp, Zoom and Google Hangouts should further entice the networks to cut costs so they can enhance their share of both the data and voice pie 

 As costs start to reduce, the resulting transparency in the market will allow consumers to compare their packages, change service providers and make educated decisions to get the best deal possible.

Impact on corporate businesses

Whilst the benefits of reducing interconnect costs have not found their way to the consumer yet, corporate South Africa has yielded large cost reductions in their telephony spend since the advent of the interconnect rate benefits. As these rates continue to fall, and the popularity of VoIP and cloud telephony solutions continue to rise, the large telco incumbents corporate market share is being challenged even further. With providers competing in price and service delivery, businesses throughout the country have also been able to benefit from cheaper prices and more choice. As a result, the B2B market is highly competitive. However, even though there is now an abundance of choice in the market, many smaller providers still struggle to compete, on price alone as the mature networks have the upper hand due to their scale and time in the market, meaning their prices are often cheaper. Smaller providers have to look at their service levels and operational efficiencies to separate themselves from their competition.

What lies ahead?

It’s obvious that the reduction in the interconnect rate has meant that telecommunication costs have come down, competition has increased and consumers have benefited through better transparency and choice across providers. 

The current landscape shows that prices for both consumers and corporates will continue to drop, the interconnect rate will continue to decrease and mature networks are most likely going to hold onto their market share thanks to their established time in the market.

However, what is not yet clear is whether the consumer will derive the full benefit of the reduction in the future, whether healthy competition will continue to grow, and lastly, whether this changing market will contribute substantially to South Africa’s major need for GDP growth.

Post written by Kyle Woolf
Chief Executive Officer (CEO) – Saicom Voice Services

Saicom Update – COVID19 (26 March 2020)

Dear Customers and Partners,

As a cloud-first technology provider, helping our customers and partners take advantage of technology and all its benefits, is core to who we are.

Yet today we find ourselves confronting a situation never before experienced in our lifetime. As the COVID19 pandemic has continued to infiltrate our lives we have been forced to change routines and habits at their most basic levels. Simple pleasures we once took for granted, like meeting friends for a coffee, have suddenly been taken away from us overnight.

As we enter a lockdown period in South Africa from tonight at 23h59, we will face unchartered territory both from a business perspective but more importantly as a community of South Africans.

Our Service during Lockdown

As an organisation involved in the Telecommunications Industry and in terms of the Presidential guidelines, Saicom has been included in the list of exempt businesses allowed to trade and provide Telecommunications services during the lockdown period.

To this end, we would like to inform all Customers and Partners that we remain open and fully operational and will continue to provide essential telecommunication services to those businesses that need it.

Whilst most of our Staff are working from home to limit our employees’ exposure and conform as much a possible to the conditions of the lockdown both our Support and Installs teams are ready to take your call or provision services as you may require them.

How can we help you?

Since Presidents Rhamaposa’s address to the nation on Monday night, many businesses have been asking similar questions- How do we remain efficient and productive during this period? How do we enable our teams to work remotely so that they along with their families can remain safe during this trying time?

As a specialist ISP and Telecommunication provider we are ready to enable this environment for you. Whether it is Mobile Data that your staff need so they can access the Internet from home or enabling calls through their work extension to take advantage of PBX systems already in place we are a phone call away to making this a reality for you.

Stay Safe

We would like to wish all our Customer and Partners well over this challenging time. Let us all heed the advice we have been given and abide by the regulations that President Rhamaposa has put in place. It is the responsibility of each and every one of us to help South Africa return to where we belong as a business community and as a people.

Stay safe and call us. We are waiting to help you.

The Saicom Team

Expansion without sacrifice: Kyle Woolf

Published – CEO Magazine (26 September 2019)

Culture is the most important part of any business, says Saicom CEO Kyle Woolf.

Kyle Woolf Saicom CEO

“Often, as a management team, we hire for our individual weaknesses, as opposed to complementing our strengths. So, areas where we’re actually deficient, we will hire for. That has been critical to our success.”

Saicom is a South African telecommunications service provider that exclusively uses cloud-based services and focuses on telephony systems for small businesses, corporate clients, VoIP operators and resellers across the country.

Over the past few years, it has grown organically, with an eye to potential acquisitions both locally and offshore. But the most important element of that growth is expansion without sacrificing the Saicom culture. “That’s my leadership style,” Kyle explains.

“It’s people-centric and it’s output-focused. I don’t care where you are, I don’t care what you’re doing – as long as the output is there. If the output isn’t there, then it’s about making sure that you at least have the tools at your disposal to enable you to do your job to the best of your ability.”

“I don’t care where you are, I don’t care what you’re doing – as long as the output is there.”

Kyle came to the communications industry from an unusual perspective. Trained as a chartered accountant, and with most of his prior experience coming from the banking sector, he admits that taking over the reins at Saicom was “a major baptism of fire”.

Originally, he came aboard to shadow one of the original founders, who was stepping away from day-to-day operations, and take over as Financial Director across three companies within a larger group.

Three years later, and with only those three years’ worth of experience in the industry, Kyle took over as CEO of Saicom Voice Services. It was a challenge that suited this son of an entrepreneur. “A theme in my life and I suppose how I manage people within our organisation, is if you have the right attitude, you can learn anything,” he says. “Attitude can’t be taught, but skills can be.”

That non-traditional path to the top has served Kyle well in the big chair, where he takes a less-structured view of how the organisation is functioning than someone who has climbed a more straightforward career ladder. “Most people have specific jobs and are siloed in those jobs,” he explains.

“They have quite a narrow, specialised focus in terms of what they do every single day. But I think being in management and running a business gives you a much broader view of what’s going on.

“I think that’s actually the most gratifying part of running a business. It’s really being able to sit back and say, ‘Wow, I had a small part to play in that.’”


Kyle Woolf Saicom CEO


The telecommunications industry has always been driven by technical innovation, but for Kyle, the most interesting aspect is the human one. “The challenge of people and understanding what makes them tick is the most enjoyable,” he says.

“When you create a culture that allows people to grow and display excellence in their chosen job, that gives me a huge amount of satisfaction. And being able to add value at a strategic level – I don’t think many people get the opportunity to look at a business from this vantage point.”

Hiring the right people is the first step, of course, but that strategy only works if you are also fostering a company culture that allows them to do their jobs in their own way, without the fear of being punished for exploring less-trammelled paths.

And Saicom does just that. “Just as a general concept of not being scared to try even if you fail,” Kyle says. “You can’t be innovative if you’re scared to fail. You have to be allowed to fail. The culture we created within our business is one where our engineers have the room to play. To break. To fix. To learn. And that is ultimately where the innovation happens.

“You can’t say, ‘Okay, cool, on Monday from two to three we’re going to do an innovation workshop.’ Innovation is something that potentially happens at 12 o’clock at night when no-one’s around. So if you can give people the platform to innovate and make mistakes, without getting fired or given warnings and having a really bad consequence to their failing, then that change is something people can adapt to quite quickly.”

“If you can give people the platform to innovate and to make mistakes, without getting fired or having a bad consequence, then that change is something people adapt to quite quickly.”

That mindset is invaluable in a sector that is constantly looking into new and innovative practices, such as SD-WAN (Software-Defined networking in a Wide Area Network), which is adding massive value in application management and network control, and is now being offered to customers at both the click of a button and in real time.

Another major development in the telecommunications industry in recent times is the concept of omnichannel. “We’re voice and connectivity experts – that’s really our game,” Kyle explains. “One of the big changes we’re starting to see now – omnichannel – is where people, when they’re talking to a customer, want to understand that customer end to end.

“People have Twitter accounts, they have Facebook accounts, they have Instagram accounts, they have email, they have instant messaging, WhatsApp, all that type of stuff. They want to bring everything together into a centralised platform.”

Continuing on the topic of the future of the telecommunications industry, Kyle has a lot of thoughts about how the space will be shaped, and reshaped, by some nascent technologies – though he won’t be drawn on specific blue-sky predictions. “I don’t think anyone really understands what it’s going to look like in five years’ time, let alone 20 years’ time,” he says.

“From our perspective, we haven’t really dabbled in the IoT space yet, for example. I think the key in that space is trying to understand what type of niche you really want to play in. There’s so much noise around it – let’s get rid of the noise, understand what the value proposition is and make sure that the application you choose can be used and accessed by the masses, as opposed to something that is almost too niche.

“AI is also interesting, in terms of how it’s going to replace ordinary tasks and jobs. We all know the stat that 60% of jobs today will not exist within the next 20 to 30 years.

“That’s a scary thought but artificial intelligence will have a huge role to play in taking those menial tasks and creating efficiencies for both service providers and customers alike. As a technology provider, we hope to be at the forefront of that technological wave.”

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SD-WAN in the SASE world

Coined by Gartner last year, Secure Access Service Edge (SASE) is a term that combines network security functions with wide area network (WAN) capabilities to support the dynamic secure access needs of organisations. But why is it important when many decision-makers are still coming to grips with software-defined networking (SD-WAN) and edge security services?

To understand the impact of SASE one must first get a top-level view of the state of the networking market. On the one side, there has been an influx of focused SD-WAN vendors who have been adding security as part of their offering. On the other, there are the incumbent security vendors who have decided to introduce SD-WAN functionality to their product stack.

The latter see it as a feature while the former understand its complexities given the cloud-based nature of their approach. In an SD-WAN environment, applications must be streamlined across the network and have security integrated (either natively or through service chaining ). The challenge with the most incumbents is that they want to deliver all security aspects through their own brand irrespective of whether that is best suited to the platform, application, or device.

Most SD-WAN vendors are all about choice. They give customers the freedom to service chain their own security solutions into the mix, giving them the best of both worlds. SASE is an evolution of this approach as it gives the SD-WAN vendors the ability to choose which security vendors they partner with. In fact, the SD-WAN discussions of today will make way for SASE discussions in the future. As more data moves into the cloud and edge computing grows, attention will increasingly turn to network optimisation and security throughout the data journey.

And it is in this space where SASE can play an important role.

A new dynamic

Given the nature of their business, security vendors will also focus on security often to the detriment of the SD-WAN. Understanding how an application functions over the network will be a precursor to deploying the right security functionality for the organisation.

Cynics argue the SASE classification gives those incumbent security vendors more license to ‘bully’ their way into network discussions. However, the choice aspect of security must never be forgotten. Already, SD-WAN vendors are introducing more built-in functionality into their offerings in order to combat this security-led tactic by the security vendors. Expectations are that there will be consolidation between security and SD-WAN vendors with mergers and acquisitions becoming par for the course.

But there is still significant education required to happen in the market around SASE. It is easier for larger corporates with more resources to embrace. For mid-market companies and SMEs, a term like SASE just adds to their confusion. For them, it is not about having to worry about the bits and bytes of security, SD-WAN, or SASE. They just want their networks to work, be secure, and effectively transfer and manage data.

Partner approach

This means that finding a trusted partner who understands the business roadmap and is willing to work with the customer to evolve their network and security requirements is fundamental to getting SASE done right.

It is not good enough to look at current needs, but also remain cognisant of how the network of the company will evolve in the future. Working with a partner that goes beyond a traditional single vendor option helps to give the business a variety of choices better suited to requirements. Sure, ticking boxes might be fine for the short-term, but organisations can look to trusted partners, to help them find ways, and deploy solutions that secure their technology investments for the future.

Ensuring the success of SASE in the future requires an intimate understanding of what is currently working on the network, how it is secured, and how it will have to evolve as the digital market continues changing.

Greg de Chasteneuf, CTO at Saicom

CellC halts non-geographic number porting in South Africa

In 2018, the Independent Communications Authority of South Africa (ICASA) took steps to enable the porting of non-geographic (i.e. 0800, 0860, 0861, 0862 and 087). But it did not take long for embattled operator Cell C to launch an application in the High Court to stop this from happening.

And while this is pending and there is no urgency from the mobile operator to move the application along, the country is dealt a series of significant blows, not only in terms of opening the market for fair and competitive behaviour, but also network outages that impact call centres nationally.

Despite VoIP service providers being given non-geographic numbers by ICASA, the bulk on inbound call revenue still sits with Telkom – even when it cannot remain relevant in a digitally driven world.  And Cell C’s application has halted any progress on opening the competitive playing field.

More importantly, customers that have non-geographic numbers core to their day-to-day business will continue to feel the impact of large scale Telkom network outages like the one we have seen recently. Telkom still has a monopoly on most non-geographic numbers and businesses are left with no choice.

It is ludicrous that companies are still unable to port these numbers and work with service providers who are committed to driving an always-on call centre capability.

The reality is that Cell C’s application is a result of the company not agreeing with elements of the regulation. For example, the proposed regulation calls for an additional validation step and given how Cell C wants to be able to port as many people as quickly as possible, this could complicate the process and impact on migration numbers. Furthermore, if a number is not ported within a specified amount of time, it reverts to the original provider. Reading between the lines, this could indicate that Cell C is not efficient enough in porting customers and stands to lose more business.

So, while Cell C is trying to fight for its best interests, the entire non-geographic porting process has ground to a halt, setting the country back years. By implication, Cell C is assisting Telkom maintain its anti-competitive behaviour and helping feed the last remaining cash cow it has in place from a voice business perspective.

For us, it is about creating an environment where customers can benefit from reduced prices and better service.  And service providers can start introducing more innovation to a market that is still stuck in the Dark Ages in many respects.

Cell C, it is time to set a date.  Make your case and move our telecommunications industry forward and give companies the choice when it comes to service providers.

Greg de Chasteauneuf, CTO at Saicom

HCI and SDx – the evolution of business and the data centre

Storage and networking vendors see software defined everything (SDx) as the next evolution of linking the business to the data centre. Today, it is less about the hardware and more on how it can be ‘cloudified’ to unlock more opportunities.

Of course, hardware is not going away. Vendors still need to put equipment down, but their focus is more geared towards the implementation of additional software and cloud layers. These facilitate a licensing model and expand capabilities beyond what pure hardware can do. Virtualisation is now something that is done as a matter of course. It is everything that is done on top of that where most of the exciting things are happening in the data centre environment.

The influx of cloud providers has seen many trigger-happy companies lifting and shifting to the public cloud. However, the hybrid cloud is clawing its way back where the most critical data is kept close to the organisation with everything else migrating to a public cloud environment.


Hyper-converged infrastructure platform

This has seen Hyper-converged Infrastructure (HCI) become more commonplace. Scaling using HCI is more cost-effective and efficient than the traditional three-tier environment. Expanding in this new dynamic way is as easy as plugging in a new node and letting the system automatically allocate the resources where they are most needed.

So much of the HCI environment is automated and numerous tools are readily available to get things up and running as quickly as possible. And being driven by software makes it perfect for a world that is going to revolve around SDx before too long.


Security measures

But despite the migration to a software-driven data centre environment, decision-makers must be mindful of ensuring security remains embedded into every aspect of the business. This should not only include the data centre, storage, and networking, but also training staff to ensure they understand phishing and social engineering attacks, and ensuring the business is compliant within the requirements of its industry sector.

So, from a data centre perspective, HCI and SDx do not change the fact that security must still be a layered approach. This sees questions needing to be asked of vendors and managed services providers and whether they are compliant to the minimum specifications of the organisation. It comes down to basic cyber security prudence that the tools made available through HCI and SDx are used to their maximum potential.

Just because a business is in an HCI environment, does not mean management can assume it is completely safe. On the contrary, there is more software that can now be exploited as opposed to varying hardware devices that need to be individually exploited. Prudence in this area is key.  A company can only protect what it knows about, so the network must be continually monitored especially as more data access points become available.


A new world

The market is putting the emphasis on SDx. In a tiered infrastructure, the entire idea of performance as it relates to storage is a big thing. Traditionally, this meant certain applications had to reside in specific tiers of storage according to their performance requirements. Now with SDx, movement between these tiers is no longer cumbersome. .

It is not something that should be managed as it just happens automatically thanks to how it has been defined. The ability to migrate workloads between different performing disks is fast becoming an antiquated concept. Most workloads today are already on fast storage that will only become even faster.

The reliance on software and its flexibility to optimise the link between the data centre and the organisation will only increase in the coming months. How organisations adapt to this market will only become more important in the push towards HCI and SDx.

Joshua Grunewald, Cloud Hosting Manager at Saicom

How to grow a successful tech company

Technology is a challenging market sector to operate in – everything happens in real-time, customers want to access products and services at any time of day or night, and you must ensure there is not only round the clock support but also that the company stays at the forefront of innovation. Fortunately, there are a few basic principles that can help guide the business towards success.


  1. Robust and scalable technology

Whatever technology your company brings to market, must be robust and scalable. This is where management must spend the time, money, and effort to hire the right people to build the components behind the technology solution.

From our side, we were fortunate to get funding in place early on which meant we could hire quality engineers to build a rock-solid network. After which, we got the sales team to grow the business. However, most companies will have to start with sales first to get the funds in place to fine-tune their solution. In this instance, they should be careful not to oversell but within the parameters of the support that will be available while the solution is being finalised.

If your product and service is scalable, and there is a big enough market for it, then you will be able to find funding soon enough. And if you already have revenue coming in, then the discussion becomes even easier.

  1. People-driven success

As much as technology forms the foundation, any business is about its people. Without them, the best solution in the world cannot succeed. But more than appointing like-minded individuals who share in your vision, management must ask themselves where they need those people to be as efficient as possible.

This is where an intimate understanding of the workflow of the business comes in. Generally, it starts with solution architects and sales teams followed by project managers, and installation and support. Finally, there must be those able to work operationally and manage everything to ensure it runs smoothly. Even though this might sound obvious, it is surprising how few people know and understand this.

It is therefore critical to build the business around the correct workflow, one that delivers a seamless customer experience during every step of the process – from purchase to after-sales support. This revolves around setting customer expectations early on and showing you value them as individuals. People want to feel like they are heard, and providing constant communication is vital to achieving this.

  1. Keep your focus

A mistake many technology businesses make is trying to be everything to everyone. Instead, they should try and adapt their skills and core competencies to be better than that of their competitors. Even though you might not have the product set of a large organisation, you have the perfect opportunity to focus on your niche.

It is about showing the customer you can produce a solution that is seamless and can integrate with their requirements. This will see you eventually become a trusted advisor to them.

However, if you do feel the need to build products that are not core to the business, consider outsourcing it first. This will see you remain focused on the fundamentals of the organisation. And if the new solutions are successful, you can then start building skills around it.


  1. Quality always

Irrespective of your focus area, you should never compromise on quality when providing a solution. Even if the customer wants something in a hurry and is willing to pay for it, do not do it. It creates a massive knock-on effect in the business that puts staff under pressure and can result in significant internal issues.

Furthermore, the customer will end up looking foolish when it is a rush job and simply blame you, resulting in   your reputation being damaged in the market. If you push back, the customer will understand that you are focused on always putting quality first. Suddenly, it becomes less about making a quick buck, but rather delivering a solution that puts them first.

  1. Embrace disruption

Finally, your business should always be willing to embrace disruption especially when it comes to technology. After all, what worked 18 months ago might not be relevant today. You must continually evolve and look at where your market is headed, adapt to that, and deliver solutions accordingly.

This is where you can use an outsourcing model to test certain new solutions first to see if they work. Never over invest until you know there is a market need for these solutions. Eventually, your offering will expand and become more complete. Ultimately, it is about understanding your target market, and developing solutions accordingly.

Kyle Woolf, CEO of Saicom

SD-WAN, the new MPLS.

Software-Defined Wide Area Networking (SD-WAN) is one of the most disruptive technologies to come to the fore and is impacting MPLS providers’ revenues. Many MPLS incumbents find themselves without an SD-WAN offering because they simply don’t have the ability to rapidly adopt new technologies and take them to market, and do not want to erode existing revenue streams.

Businesses should be cautious about signing new or extending their existing MPLS contracts. The cost, inflexibility and slow time to delivery is making MPLS an archaic technology and one which inhibits cloud migration and future growth.

Cloud migration has increased the urgency for transforming wide area networks. According to Gartner 30 – 50 percent of large enterprise traffic is shifting to the cloud, changing traffic flows and making traditional WAN suboptimal, meaning the cloud is becoming the network.

Here are five compelling reasons to make the switch to SD-WAN sooner rather than later.

1. Agility, flexibility and cost saving

Businesses currently rely on an MPLS provider that can take days (even weeks) to process requested changes. Enterprises turning to SD-WAN, however, stand to benefit greatly from being able to quickly change policies and provide new services without having to get a provider involved. The technology gives enterprises full control and flexibility.

In a retail environment, the rapid provisioning and closing of a site is paramount. With SD-WAN, IT departments can take available off-the-shelf bandwidth, whether it is fibre, ADSL, LTE or satellite and plug the connectivity into the SD-WAN device and the site is live within minutes, at a fraction of the cost.

With SD-WAN, a typical site can be between four and ten times more cost-effective with the same service level agreement (SLA) as MPLS, depending on the current MPLS service provider used.

2. Quicker provisioning of services

More enterprise applications are moving to the cloud. A fact confirmed by IDC, which states that 80 percent of new applications will be deployed in the cloud by 2030.

With SD-WAN, an IT department has the ability to insert a new service into its network in minutes instead of weeks. Thanks to a central orchestrator, configuring the rules – business logic rules as opposed to very technical rules, is simple. Once the rules are applied, the SD-WAN infrastructure will replicate them to the edge devices and sites.

However, when relying on MPLS, the IT department has to discuss the decision to use a new application or cloud service with its MPLS provider. There can be cost implications and it can take several months to ensure that the MPLS network can reliably carry the new service’s traffic across the network.

3. Insight into the network

IT departments and network administrators can have complete insight into their network. They no longer have to log tickets with their service provider to find out the status of a link or site, or make firewall changes. They can have complete visibility through the SD-WAN orchestrator of which sites are up, which ones are down and which ones are performing poorly and then take action to mitigate those issues.

4. Rising bandwidth requirements

According to the IDC, branches experience a 20 percent increase in enterprise WAN bandwidth per year with network traffic doubling every three years.

The immediate benefit of SD-WAN, bar the cost saving, is that an enterprise’s network will have more bandwidth available at a lower price. The result is that business can find ways to utilise that bandwidth to improve the experience of its customers and staff, and it can introduce new applications into its network.

Businesses want to offer their customers new services, including video and guest Wi-Fi. Higher bandwidth applications, such as High Definition video, will typically drain the MPLS network, but with SD-WAN, businesses offload that traffic onto cost-effective internet links.

5. Hybrid deployment

Enterprises currently locked into MPLS contracts can consider a hybrid deployment that combines MPLS with internet off-the-shelf links into the SD-WAN infrastructure.

The advantage of SD-WAN is its ability to leverage existing links and over time, as the ease and usability of the system becomes apparent, and as the SLA matches that of MPLS, the MPLS links can be phased out.

It is advisable to work with a managed service provider that has both MPLS and SD-WAN experience so that it can consult on a hybrid environment that meets the business’s SLA criteria.

IT departments have lost control of their corporate networks for far too long. The time is now for businesses to take control of their networks and gain scalability, insight, cost-saving, bandwidth and ultimately future growth.

Post written by Greg de Chasteauneuf
Saicom Voice Services (PTY) LTD

Flexibility, service excellence driving businesses to smaller service providers

Frustrated South African businesses are increasingly turning to smaller telecommunications service providers, drawn by their ability to innovate and craft bespoke solutions that are backed up by a higher quality of customer service.

More than just a good sale or good installation experience, it’s the after sales service that helps smaller telecoms service providers differentiate themselves. Businesses are tired of having to make endless support calls, as well as the seeming lack of urgency with which their problems are addressed. They want to be more than just another number to their service provider.

Accountability, flexibility

Businesses are also looking for a single point of accountability, and smaller providers are able to offer just that, by ensuring that as far as possible, all services are provided in-house. Too much outsourcing, or selling too many services often causes confusion for the customer who can never be sure who to contact in the event of a problem.

Larger providers not only lack agility when it comes to customer service, but can also be inflexible in their product offering and pricing. Their smaller counterparts, however, do not encounter the same struggles, and have also been far quicker to automate many processes and systems, meaning they are able to speed up the decision-making process and provide innovative solutions to their customers.

While smaller service providers like us might have defined products and pricing structures, we are far more willing to engage with clients who want something different, and to tailor a solution to meet the requirements. This includes being able to customise the services included and the contract duration.

Providing a more personalised level of service also allows for a deeper understanding of the customer. In turn, this enables the service provider to upsell products that can help the customer further enhance their business, over and above the benefits resulting from use of the base product sold.

Service is key

Working with a smaller service provider offers businesses this level of service: unlike with large-scale providers where customers don’t have access to senior company executives, key decision makers at smaller service providers are often just a phone call away.

Our management team for example participates in WhatsApp groups with our customers, allowing these key team members to be kept abreast of problems affecting customers, and to directly intervene should the need arise.

Having this clear escalation path means issues that are difficult to resolve through the customer support centre are brought to the attention of senior staff timeously. Even in situations where an issue cannot be resolved immediately, it’s about ensuring that the customer knows the problem is being attended to, and then managing expectations.

It is vital that smaller service providers master this: companies are looking for customer references when it comes to choosing a telecoms service provider, and quality after sales service provided to a key client can lead to positive referrals, and potentially new business going forward.


Post written by Kyle Woolf
Saicom Voice Services (PTY) LTD

SD-WAN to simplify business IT, unlock new opportunities

With much being done in 2016 to raise awareness and demystify Software-Defined Wide Area Networking (SD-WAN), larger enterprises in South Africa are starting to come to grips with the full range of benefits, and new business opportunities that are opening up by turning to this relatively new technology.

The IDC estimates that worldwide SD-WAN revenues will exceed $6-billion in 2020 with a compound annual growth rate of more than 90% between 2015 and 2020.

Locally, the technology is gaining traction particularly in the retail sector. Despite several challenges, including companies being locked into long-term MPLS contracts, few understand that the benefits extend beyond a cost conversation, and many confuse the solution with Software-Defined Networking (SDN).

Early adopters are seeing value, with SD-WAN providing increased bandwidth at a lower cost, while also enabling them to reduce overall operational expenditure.

In retail, this increased bandwidth availability enables new business strategies, including the delivery of High Definition video and rich multimedia to stores, and provision of guest Wi-Fi for customers, while at the same time allowing for transactional data to traverse over a PCI 3.0 compliant network.

In a digital era, businesses need to ask themselves whether MPLS is helping or hindering their future growth. Companies that continue to resist change may not only end up spending more than necessary on legacy networks, but also face being leapfrogged by competitors using SD-WAN to enable new digital strategies and provide better customer experiences.

Simplifying business ICT

According to the IDC, benefits of SD-WAN include cost-effective delivery of business applications, meeting the evolving operational requirements of modern branch sites, optimising software-as-a-service (SaaS) and cloud-based services such as UC&C, and improving branch-IT efficiency through automation.

As the technology matures, it is starting to compete with more of the ICT stack in businesses. Vendors now integrate advanced software-based protection against cyber threats, bringing them into competition with next-generation firewall providers – and this is only the beginning.

There is a big shift toward simplifying enterprise networks by doing away with the multitude of devices currently needed at a branch level, such as routers and firewalls. The goal is to have a centralised orchestration panel that provides complete control, and a simple device on the edge – SD-WAN brings us a step closer to achieving that.

Businesses currently rely on an incumbent MPLS provider who can take days (even weeks) to process requested changes. Enterprises turning to SD-WAN, however, stand to benefit greatly from being able to quickly change policies and provide new services without having to get a provider involved. The technology gives enterprises full control, flexibility, and insight into their network.

SD-WAN in Africa and beyond

We’re starting to see a growing interest in SD-WAN from companies operating across Africa, where several large incumbents have monopolised the telecoms space, and have kept the per-megabit price of MPLS services extremely high in their respective markets.

By switching to SD-WAN, businesses can plug into any connectivity available – fibre, ADSL, LTE or satellite – and have an MPLS replacement at a fraction of the cost.

Further abroad, large carriers are actively exploring how they can use SD-WAN to complement existing MPLS strategies and provide customers with a complete networking offering. For example, in the US, Sprint and AT&T have partnered with VeloCloud, while globally, Tata Communications has turned to Versa for SD-WAN provision, giving the technology added credibility.

The technology is proving itself locally and internationally, and as long-term MPLS contracts come to an end, SD-WAN becomes a reality for more businesses. It is here to stay, and is becoming a major disruptor to MPLS VPNs.

Post written by Greg de Chasteauneuf
Chief Technology Officer (CTO) Saicom Voice Services

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