State’s IT merger plan slated

The government’s plan to merge state-owned enterprises to form one broadband firm is shortsighted and costly, according to the Democratic Alliance spokesperson on telecommunications and postal services, Marian Shinn.

The department of telecommunications and postal services told its parliamentary portfolio committee that it wants to merge Broadband Infraco and Sentech into the State Infrastructure Company to fast-track the rollout of internet to 90% of the South African population as part of its SA Connect programme.

“It is clear that the focus of the department has shifted from meeting the urgent delivery deadlines of SA Connect in underdeveloped areas to building yet another state-owned company from the existing fibre networks and infrastructure operated by state entities Broadband Infraco, Sentech, Prasa, Eskom, Sanral and Transnet,” said Shinn.

The department envisages drafting legislation to merge Broadband Infraco and Sentech into the State Infrastructure Company. Both entities would be expected to fund their merger and future operations from their balance sheets, but neither currently receives government funding.

“BMI-TechKnowledge … estimates the capital funding needed for the rollout at between R32.9-billion and R84.9-billion, depending on the technology used,” Shinn added.

Shinn said if the government was serious about rolling out broadband to the nation, it would sell Sentech and Broadband Infraco’s network, reduce red tape between all spheres of government, resource the Independent Communications Authority of South Africa adequately to drive infrastructure-sharing regulations between network licence holders, and incentivise the information technology sector to connect underresourced areas.

Shinn said the merger plans “will remain a major deterrent to the expansion of broadband rollout …and exacerbate the digital divide between poorer rural communities and the internet-empowered urban areas”. —

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Lungelo Shezi Htxt
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