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By: Abacus  12-08-2011
Keywords: employment, it recruitment

29 February 2008 Seacom’s promise to shave 80% of international bandwidth costs is more good news for the local telco industry Seacom’s plans to offer broadband Internet connections at around 0.1% of the price of current satellite services is another “welcomed fillip” for the local telco market. Viewed in conjunction with the announcements that both Neotel and state-owned broadband supplier, Infraco, are ready to roll out solutions to the marketplace, local market watchers are predicting that the telco industry will face increased buoyancy during 2008 and beyond. Christopher Riley, CEO of notebook retailer, The Notebook Company ( “Seacom’s pricing structure, which was announced earlier this month, is expected to reduce international bandwidth prices by up to 80 percent. This will enable local companies to become more competitive as our communications costs, for a long time, have been punitive. We are moving from a market of low volume and high profit – for the operators, that is – towards one of high volume and low profit. This is because we are now moving steadily away from a monopolistic environment.” Seacom, the privately owned undersea cable project, is expected to go live with its $600 million cable by June 17 next year. “Due to the dynamics of the local market, including the fact that Neotel and Infraco are ready to roll out solutions, we are going to see increased activity during 2008. But I think the real buoyancy will take root from 2009 as the affects, like price reductions, start making a noticeable affect” Neotel, SA's first converged communications network operator, and the government-launched Infraco - which has the strategic aim of lowering communication costs in the country – are expected to break the monopolistic hold Telkom has had on the local market. “The cost of communications has been holding South African companies back from a competitive perspective. These developments,” said Riley, “can only lead to positive affects – positive affects that will also lead to local companies winning more business, and employing more staff.” Karen Geldenhuys, a director of Pretoria-based IT recruitment agency, Abacus Recruitment, said: "There is a lot of activity in the ICT industry at the moment from a job seeking perspective. We are seeing a spike in CVs out there in the market. Our consultants also believe that this is, in part, is due to the fact that Neotel is now on the scene. Employees from companies like MTN and Vodacom are very keen to find out what Neotel has to offer. “Unfortunately, a lot of this vigor right now is really translating into market churn. A large chunk of the interest being shown is coming from skilled workers, some of whom who are able to pick and choose positions. We are not seeing a lot of activity from new job seekers, or job seekers with less skills. What we need is for companies like Neotel to employ fresh faces, not to head-hunt highly skilled staff from competitive companies. That just amounts to churn and simply re-arranges the chairs at the party. “But, with recent good-news announcements, such as the gearing up of Neotel and Infraco, we are hoping for an increase in employment in the telecommunications industry. As confidence returns companies will become more upbeat – and this is when they will start hiring, as well as because of the more favourable trading landscape that is now being developed in the telco market space. With communication costs coming down, more companies will be able to compete. This means more business, more money, and,therefore, more jobs. But I think the increase in real employment will only start emerging in 2009. However, the increase in employment is only likely to be marked if the local economy returns to a more benign environment. One of the things local companies will be keeping a watch on is the inflation rate. If it starts to come down in the fourth quarter of 2008, we are likely to see some action during 2009 and beyond, certainly in the telco industry.”
The information in this article was current at 08 Nov 2011

Keywords: employment, it recruitment

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