Erwin outlines Infraco

By Paul Vecchiatto, ITWeb Cape Town correspondent

Cape Town, 12 Feb 2007

Infraco, government's new broadband wholesaler, will essentially be a fibre optic network operator and will set a reference point for broadband wholesale prices, says public enterprises minister Alec Erwin.

Speaking at a parliamentary media briefing today, Erwin said Infraco would be launching in March and that it would provide long distance connectivity on a cost plus basis to the market, through an initial arrangement with second national operator Neotel and based on the telecommunications infrastructure originally built by Eskom and Transnet.

Erwin went on to say that "some exciting developments with regard to undersea cables" are in the pipeline. He did not give any further specifics, beyond hinting that more detail would be forthcoming in a briefing to parliament later this month.

The minister says that his department is currently working on draft legislation for the governing of Infraco and while this will not be a "big law", it will cover issues such as how the company will be run and technical issues such as servitude - the right of way over land that has been set aside for services.

Servitude arose as an issue in July 2005, when Erwin halted the initial signing of the deal to transfer the telecommunications assets of Eskom and Transnet to the second national operator, becauzse government wanted to retain control over its servitude rights as it was then contemplating the creation of Infraco.

Points of Presence

Erwin says Infraco will have points of presence in all of the country's cities and towns and will supply its broadband to whoever needs it, including Neotel, Telkom and the VANS (value added network services).

He says the price at which Infraco will supply broadband will be based on "cost plus", as government has adopted a policy that state-owned-enterprises should be commercially viable and require very little further funding after the initial cash injection.

Infraco's assets are currently housed within an Eskom subsidiary and will stay there until the company is fully incorporated, Erwin says.

Strategic Imperative

At the same media briefing, communications minister Ivy Matsepe-Casaburri said that Infraco forms part of the country's broadband strategy.

"Telecommunications is just one player for broadband. There will be other greater demands [for broadband] such as the Square Kilometer Array [the proposed international radio telescope], the 2010 World Soccer Cup and the Karoo Array Telescope," she says.

Matsepe-Casaburri says the creation of Infraco will help the country meet its strategic imperatives of bringing down the cost of information and communications technology, including the development of the SA Science Research Network - a project under the auspices of the Department of Science and Technology - to bolster the country's research and development capacity.