Ngcaba praises minister

Johannesburg, 06 Sep 2004

Former Department of Communications director-general and Dimension Data executive chairman designate, Andile Ngcaba, has congratulated the communications minister on moves to liberalise the telecoms market.

Ngcaba was reacting to government`s announcement last week that it would allow greater competition in the telecoms market from 1 February. The moves include legalising the use of voice over IP (VOIP) and allowing value-added network services to resell spare capacity.

"We at Dimension Data have to congratulate the minister (Ivy Matsepe-Casaburri) on making these changes. We have been anticipating them and we look forward to participating in a rejuvenated market," he says.

Ngcaba served for eight years as the director-general of the Department of Communications before taking up his present position with DiData. Before leaving the department in January, he oversaw the listing of incumbent telecoms monopoly Telkom, the Convergence Colloquium that led to the first draft of the Convergence Bill, and the start of the department`s market study that led to last week`s announcements.

"When I left the department, the market study was under way, but I did not quite know what the recommendations would be," Ngcaba says.

He says DiData has no ambitions to become a telecoms utility-type company and will remain a systems integrator, or networking specialist.

Ngcaba says the announcement creates a level playing field that will allow DiData to capitalise on selling networking equipment to prospective operators and its subsidiary, Internet Solutions, would also gain. The move will, for instance, allow the cost of Internet connection to be dramatically reduced, he says.

"We have to examine the government`s announcement quite carefully before embarking on a strategy. However, our black empowerment credentials mean that we can be a major force as we can bid for government and other business on an equal footing," Ngcaba says.

DiData recently concluded a R380 million black economic empowerment deal with Ngcaba`s investment company holding a substantial stake of the shares. "We can now pursue the South African and the rest of Africa`s telecoms markets with vigour as they become more and more deregulated," Ngcaba says.

Positive reaction still flooding in

Meanwhile, the ICT industry is still responding positively to the telecoms liberalisation.

Business Day quotes Matsepe-Casaburri as saying there had been "great excitement" over the moves among members of the President`s International Advisory Council on ICT, which met this weekend.

"MTN welcomes any move that liberalises the telecommunications market and will study the policy document with great interest," says Yvonne Muthien, group executive of corporate affairs at MTN.

Tiscali has commented that this development could not have come at a better time. "The legalisation of VOIP will make visible the speed of acceleration we are experiencing as a country, and also level Africa with the rest of the world in terms of business, communications and competitiveness," says Udesh Inderlal, head of enterprise products at Tiscali South Africa.

Tiscali says it has been actively following trends in the European market, devoting much of its R&D spend to the development of products and services to meet the VOIP eventuality head-on.

"We are nearing the final stages of our R&D phase and are currently working very closely with a number of partners to offer both consumer and business users telephony alternatives that will reduce costs and improve efficiencies.

"For business, it`s an open playing field. We will now be able to offer businesses more choice to `cherry-pick` the best medium for their specific requirements," Inderlal adds.

Cisco Systems welcomed the news that value-added network service providers will be allowed to carry voice using any protocol, describing it as "a major step forward for the South African ICT market, which will clearly demonstrate SA`s development in the ICT market to the rest of the world".

Avaya, which says it has had "industrial strength" VOIP offerings in SA for over 18 months, also supports the VOIP move. However, the company says the uptake of its offering has been slow, "based on the past legal issues". The minister`s announcement is "a watershed one", it says.