By BTC

The para-statal Botswana Telecommunications Corporation (BTC) this week revealed that it has committed substantial amounts of funds towards the BOTSGATE backbone as it moves to mitigate criticism from corporate organisations and Internet Service Providers (ISPs) about the efficiency of bandwidth.

In the next three years, BTC has committed US$ 5 million towards the enhancement of BOTSGATE, according to the para-statal’s head of wholesale division, Duncan Pie.  Pie revealed the investment will beef up the local access network while simultaneously allowing BTC to offer services at reduced costs.

BTC operates BOTSGATE, which is the only one in the country that has international terrestrial links that connect to 6 global peering points amongst them London, Canada, South Africa, Amsterdam, New York and Zambia. All the major ISPs in Botswana that were running own satellites two years back are now using the internet backbone.

“BOTSGATE international connectivity has been strategically placed to allow access to the world’s largest global backbones”, Pie added.  Pie praised the backbone stating that it can be customised for wholesale, corporate, research, education and retail markets adding because they understand the market, it gives ‘us the chance to customise the solutions’.

Some of the initiatives that will come with making BOTSGATE attractive include localising regional traffic in that if a mail is destined for South Africa, it does not have to go London first. Meanwhile, Pie has assured the market that with liberalisation, the cost of bandwidth will ultimately be affordable because of choice of suppliers.

Pie said there have been changes in the market that affect pricing. Up to last year, Telcom SA was the only provider that had access to undersea cable, but with liberalisation, new players have come to the fore. “When the market was liberalised for players to access undersea cable, it changed pricing,” Pie revealed, giving the example of EASSy and Seacom.

Although BTC bandwidth is still expensive because of economies of scale, the para-statal has slashed prices since 2007 and recently in September 2009 that amounts to 40percent cumulatively. However, the market insists that the pricing is still above the roof and this is made worse by the announcement that the reduction is not across the board.

Pie revealed that since bandwidth is a volume business, the 40% reduction is not across the board, but it will depend on the amount of internet purchased, which means it does not affect an ordinary person. It is only those who purchase high volumes that will have discounts. Botswana’s biggest volume of internet is in Gaborone and Francistown, but BTC has been advised to slash prices more to attract new business.

“Bring the prices down and you get more data connections across the country,” one BTC client advised.

It is believed that data and internet demand is very elastic in that when you reduce prices, the uptake rises. BTC also announced that it is investing in a landing station in Namibia that will reduce the cost of bandwidth. Under the 50/50 percent joint venture with Telecom Namibia, BTC will invest millions of Pula for the undersea cable.

Meanwhile, BTC Group General Manager Commercial, Loic Descamps, says he acknowledges the challenges that the business community has including the global recession and business streamlining. He says BTC and government have invested resources to ensure that Botswana remains competitive player in the data market through involvement in the two sub-marines cables that will be operational in the third quarter of 2010.