South Africa said on Monday a new government-owned telecommunications infrastructure firm, InfraCo, would boost long-distance connectivity and bring down telecoms costs, often cited as a barrier to competitiveness.
Public Enterprises Minister Alec Erwin told a news briefing that the firm, which is due to launch in March, would carry broadband fibre between large cities and towns, with a second phase looking at enhancing available undersea network capacity.
Erwin said South Africa’s state-owned fixed-line operator Telkom, second fixed-line operator Neotel and other firms would be able to use InfraCo’s technology.
”This is why we can confidently say it will have a major impact on prices,” Erwin said.
In his State of the Nation address last Friday, President Thabo Mbeki once again singled out the country’s high telecoms costs as a hindrance to doing business.
”Broadband is viewed as a key driver of economic growth and wealth generation and therefore is essential for South Africa to gain access to universally available, reliable and affordable broadband,” Erwin said.
The recent introduction of Neotel, which is managed by a unit of Indian software-to-automobiles conglomerate Tata, is part of South Africa’s plans to liberalise a communication sector dominated by Telkom.
Neotel launched wholesale services in August last year and aims to take on Telkom in the market for consumer voice and internet services in the first quarter.
”We simply want to make sure that the costs be driven down to a level where we can compare with other countries in the same level of development as ours, and to do so faster rather than slower,” Communications Minister Ivy Matsepe-Casaburri said at the same briefing.
She said the question of the ”uptake” of the broadband connectivity would depend on what happened in the ”second economy” — or the economy representing the majority of South Africa’s poor and rural dwellers. — Reuters