ICASA, bidders at odds over USAL process

Johannesburg, 08 Apr 2004

South Africa`s telecoms regulator believes that despite the recent delays, the process of awarding the underserviced area licences (USALs) is on track, although not all of the bidders agree.

The USALs form part of the ongoing liberalisation of the telecommunications market, and will see small operators being established to serve a total of 27 areas with a very low penetration of telephones. A total of 14 applications were received for the first 10 licences and the bidders are now waiting for the regulator to make its recommendation to the minister.

According to earlier reports, the Independent Communications Authority of SA (ICASA) had planned to make its recommendations to minister Ivy Matsepe-Casaburri by 6 April, but the deliberations process was delayed due to a family tragedy suffered by one of the councillors.

"The process is still on track and we are positive that the deliberations will take place as soon as is feasible," says Phineas Moleele, ICASA`s USAL project manager.

"While we understand people`s frustrations with the delays, we felt it was appropriate to give the councillor time, thus we have chosen to play it by ear for the moment."

He says the process has suffered from unforeseen delays - such as the councillor`s tragedy - and the forthcoming spate of public holidays will not help the issue, but trying to rush the process would only have a negative effect.

However, one of the bidders - who did not wish to be named, for fear of prejudicing their bid before ICASA reaches a decision - says the bidders are "bleeding". In effect, he says, the consortiums involved are haemorrhaging money all the time the process drags on.

"It is ridiculous to have a situation like this in business, as it is an incredible drain on resources and we don`t really seem to be getting anywhere," he says.

"The stakeholders who are really suffering here are the rural people involved in the consortiums, who have seen nothing for 30 months now, despite the commitment that government has given them."

While it seems that some of the bidders are unhappy, Moleele was upbeat about the situation.

"While we do not wish to compromise the process by rushing any issues, we are very positive we will conclude our deliberations soon and make our recommendation to the minister, which I`m sure will ease the bidders` frustrations."