South Africa Desperatly Needs More Bandwidth
2007-09-11
Even more bizarre is that if the private sector comes along with huge sums to invest, in a new fuel pipeline or an undersea telecommunications cable, the government says, in effect: “No, don’t you do that, we want it for ourselves.” After all, why should local and international financiers pay when SA’s taxpayers can be hit for the money instead?
The tangled undersea cable story is the latest instance of this peculiar approach to the world. There can be no question that SA and Africa desperately need more bandwidth to connect to the outside world, or that it needs to be a lot cheaper than what we have now if telecommunications costs in this country are to come down to anything close to an international norm.
And it is urgent: not only is the dearth of international bandwidth holding back the development of industries such as the call-centre industry, but there’s also the 2010 Soccer World Cup to contend with, not to mention the prospect that SA may win the tender for the bandwidth-hungry international telescope, SKA ( square kilometre array).
Until now, SA has relied mainly on a couple of undersea cables in which Telkom has a stake. But there are now two multimillion-dollar international private sector initiatives to lay undersea cables up the coast of Africa by 2009. One is the Eassy cable, in which three SA tele-coms operators (including Telkom) have a 27% stake and which is now backed by the International Finance Corporation, which has made it a condition of its backing that the cable provide affordable open access for the African countries it could serve.
But there have been strange politics around Eassy. And communications department director general Lyndall Shope-Mafole now says that it’s bad news for developing countries and that the government will not allow it to land in SA.
If that’s not enough to drive potential international investors away, Shope-Mafole is also demanding that any private cable operators wanting to land in SA must have local investors. It’s not clear what this demand might do to the other private player planning to build an $500m undersea cable linking SA to Europe and Asia, Seacom.
“Those who want to partner with us can partner on our terms,” Shope-Mafole memorably said recently, sending the kind of signal that is almost sure to drive new potential competitors out of a mar-ket that has been strangled for years by a state-controlled monopoly.
Meanwhile, Public Enterprises Minister Alec Erwin’s new baby, Broadband Infraco, has grandiose plans to build two state-owned undersea cables linking SA to the world, one landing in London, the other in Brazil. Erwin claims Infraco can do it cheaper.
If the state had a good record we might be more sympathetic — but the best way to cut the costs of connectivity is to open up to competition. And the best way of doing that is to create a level playing field that makes it easier, not harder, for investors to put money into the necessary infrastructure.
Let the state compete, too, if it thinks it can do it efficiently and if it can justify the cost to taxpayers. If that means we end up with a collection of cables, private and public, and even with a surplus of bandwidth, so much the better. It can only serve to cut the cost of telecommunications and expand the market. Just what we need.
|
