SA's new submarine cable could be the answer to bandwidth capacity
R5bn sea cable to cut Web costs
August 1, 2007
By Thabiso Mochiko
Johannesburg - South Africa is planning a $700 million (R5 billion) submarine cable to cut the costs of accessing high-speed internet. The cable, to run from Durban to South America and London, will increase international bandwidth capacity.
The initiative is being driven by the department of public enterprises as an international leg of Infraco, the state-owned broadband infrastructure firm formed last year to lease capacity exclusively to Neotel for four years. But the international part of Infraco will be open to other telecoms firms including Telkom, which is said to be interested in a big slice of the project.
Due to the lack of undersea cables, Africa has mainly relied on the Sat3 cable that is partly owned by Telkom.
Sat3 members have exploited this by charging huge fees, which has led to strong criticism from the government as the high costs deterred foreign investments and led to slow internet roll-out in rural areas. Sat3 will compete with Infraco's west coast cable.
With the huge demand of internet bandwidth and the expected demand from the 2010 soccer World Cup, South Africa needs a cable system that offers high capacity as Sat3 could be running out of capacity.
Department director-general Portia Molefe said the goal was to have one leg of the Infraco submarine, likely in Brazil, running by 2009. The project would be funded by the private sector and the government.
Running parallel with the Infraco cable is the controversial Nepad Broadband, focussing on the east region. The Nepad Broadband was established after a fallout between the South African and Kenyan governments when they built the $280 million East African Submarine Cable System (EASSy).
EASSy was expected to run from KwaZulu-Natal to Port Sudan, with landings in seven countries. The tiff, which was over a cost-based model and open access initiated by South Africa, led to Kenya and South Africa forming new cable projects separate from EASSy.
But the EASSy cable is unlikely to land in South Africa. Lyndall Shope-Mafole, director-general at the department of communications, said EASSy was not a priority for the government as it did not contribute to its development. "I am not saying we will bar [EASSy], but we will have guidelines for companies that want to land in South Africa."
The government expects 23 countries to sign the Nepad Broadband infrastructure protocol by next month and to finalise the supplier agreement. There is much scepticism that both cables will not be operational by 2009 since there are only 17 months left and they have yet to select suppliers. EASSy was set up about three years ago and there has been a lack of progress.
Each company and country is expected to inject $2 million in the Nepad project. So far EASSy has signed a supplier agreement with Alcatel Lucent and concluded interconnection agreements with several cable systems operators.
The private sector has entered the fray with plans to build the Seacom system, linking African countries to India and Europe. The project is driven by Sithe Global, which is 80 percent owned by Blackstone, a US private equity group.
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