Sentech to return broadband funds
Ambitious bid to roll out internet stalls
STATE signal distributor Sentech’s plans to build a wireless broadband network are being frustrated by the state’s failure to devise a national broadband strategy, its CEO said yesterday.
Setumo Mohapi said Sentech had been asked by the Treasury to return R584m budgeted for the network. As a result, the company had decided to give back spectrum in 2.6GHz and in 3.5GHz while it awaited clarity from the Department of Communications.
The absence of a strategy, highlighted by the Treasury in the medium-term budget policy statement last year, will dash the government’s hopes of spreading broadband beyond the 15.8% of the population with access to the technology now.
The International Telecommunications Union says broadband can boost productivity and lift growth by cutting costs and creating efficiencies in the distribution of goods and services.
The failure to roll out broadband expeditiously also makes a mockery of the Department of Communications’ recent claim in Parliament that it had prioritised broadband penetration for the next five years to achieve 100% access by 2020.
Analysts said yesterday the news, while disappointing, was not a surprise given the department’s poor record on information technology (IT) issues. The department has met only 0.9% of its annual IT jobs targets and none of its broadband penetration targets in the first six months of the 201213 financial year.
Analyst Spiwe Chireka, telecoms programme manager (Africa) at IDC Austral Africa, said the development was a “shame”, but not unexpected given the lapses in the department.
“This network will be key on mobile and wireless data provision. What we were hoping is that Sentech will plug the gap left by big commercial players. Because
broadband has become an integral part of the economy, maybe it should not just be a Department of Communications project. A joint effort with a department like the planning commission headed by Trevor Manuel can be useful.”
Arthur Goldstuck, MD of World Wide Worx said: “The department has a profound lack of focus on priorities. It has been so obsessed with politics rather than delivering. They have been focusing on the wrong aspect of supply, which has been who gets the licences, and forgetting policy and strategy.”
Mr Mohapi said a tenfold rise in the cost of spectrum implemented by the Independent Communications Authority of SA (Icasa) was another reason for handing back the spectrum. Icasa revised spectrum fees last April, and for Sentech the fee went from R4m to R40m.
“The Treasury advised Sentech that public funds previously appropriated for the project must be returned to the national revenue fund until the department’s policy and plan had been approved by Parliament,” Mr Mohapi said.
The department has been struggling to meet some of its deadlines for broadband roll-out. The Treasury said in its medium-term budget policy statement last year its performance had not been up to scratch, largely due to delays in finalising the national broadband strategy.
In Parliament yesterday the Trea- sury repeated that funding for enhanced broadband connectivity throughout SA will only be allocated once a policy framework has been agreed upon. A spokesman for Communications Minister Dina Pule did not respond to requests for comment yesterday.
Mr Mohapi confirmed that SA was unlikely to meet its transition deadline on digital terrestrial television (DTT) and the department has conceded it was unlikely to meet the International Telecommunication Union’s 2015 deadline.
“The DTT network infrastructure roll-out remains a key priority for Sentech as SA moves closer towards the June 2015 analogue switch-off date as provided for by the International Telecommunication Union agreement. The department has, however, mentioned it’s unlikely to happen,” Mr Mohapi said.
He pointed out that regulation and policy remained one of the main risks in the roll-out of digital terrestrial television.
Icasa is yet to finalise the migration and spectrum regulations, including tariffs for signal distribution.
The budget review stated that the private sector had made substantial investments in broadband connectivity‚ which was concentrated in mobile networks and in overland and undersea fibreoptic cable infrastructure. Average internet connection speeds increased by 32% to 3.1 MBps between October 2011 and October last year.