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Enough capacity for at
least 20 years
ADSL
South Africa (Broadband South Africa), 29 April
2007
State-owned
broadband company, Broadband InfraCo, ‘has sufficient capacity
to provide high-speed national connectivity for at least the
next 20 years…’ This is according to the Department of Public
Enterprises (DPE) in a statement released last week.
In the statement released the DPE
further stated that InfraCo ‘…is easily capable of supporting
commercial, government, scientific and special-event
requirements such as the 2010 World Cup” (InfraCo: ’Enough
bandwidth for the next 20 years,’ MyADSL, 25 April
2007).
In other words, not even the 2010
World Cup will be able to place strain on InfraCo’s ability to
deliver national broadband connectivity efficiently.
Why
InfraCo?
Accessibility to cost-effective
telecoms and higher economic growth.
Cabinet has now approved InfraCo
“in an effort to promote accessibility to and lower the cost of
telecommunications” (InfraCo: ’Enough bandwidth for the next 20
years,’ MyADSL, 25 April 2007).
In other words, InfraCo will be
used as a vehicle to make broadband Internet accessible to more
South Africans while keeping the costs down.
Furthermore, ‘…the long-distance
fixed services network currently owned by Eskom and Transnet
will be transferred to Infraco and expanded “to stimulate
growth and contribute to higher economic growth levels”’
(InfraCo: ’Enough bandwidth for the next 20 years,’ MyADSL, 25
April 2007).
In other words, InfraCo should
also stimulate economic growth.
Is Neotel not in the
process of buying Transnet’s telecoms arm, Transtel
Communications?
True but Transtel’s countrywide
fiber network will be transferred to InfraCo since it doesn’t
form part of the Neotel Transtel deal.
How will InfraCo be
funded?
Money from the private sector and
the National Revenue Fund will initially be used to fund
InfraCo.
‘Infraco will initially be funded
from the National Revenue Fund and the private sector, and is
projected to be self-funding within four years of launch…’
(InfraCo: ’Enough bandwidth for the next 20 years,’ MyADSL, 25
April 2007).
In other words, external funds
will initially be used to fund InfraCo but should be replaced
by internal funds (self-generated funds) within 4 years’
time.
Towards what will the
initial capital investment go?
Infrastructure support to
Neotel.
‘The immediate capital investment
is being undertaken to provide infrastructure support to
Neotel’ (InfraCo: ’Enough bandwidth for the next 20 years,’
MyADSL, 25 April 2007).
In other words, the initial or
immediate capital investment will enable InfraCo to fulfil
Neotel’s broadband needs.
Why would InfraCo be
interested in making a capital investment ‘to provide
infrastructure support to Neotel’ if its a separate
entity?
True, InfraCo is a separate
entity but that doesn’t mean that it is not allowed to cater to
another role player in the broadband or the telecoms
market.
‘Neotel has a four year
exclusivity agreement with InfraCo…’ (InfraCo: ’Enough
bandwidth for the next 20 years,’ MyADSL, 25 April
2007).
In other words, Neotel
will be for one using InfraCo’s network in the next four
years to provide broadband Internet access services to
South
Africans.
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