Infraco gets R1.4bn

Pretoria, 20 Feb 2008

The Department of Public Enterprise`s Broadband Infraco project is to receive R1.4 billion from government.

This includes R1.6 million expenditure for the year under way and the R627 million purchase of the 'full services network` from Eskom and Transnet in the 2006/7 financial year.

Government has also revealed the company intends building its own West Coast submarine cable and has already made some upgrades to the network inherited from Transnet and Eskom.

Not quite flush

Although not mentioned in finance minister Trevor Manuel`s budget speech, National Treasury`s 2008 estimates of national expenditure reveals Infraco is to receive a further R727 million in the next three financial years.

This will see R377 million allocated at the beginning of the next financial year, due to begin on 1 April; R210 million in 2009/10 and R140 million in 2010/11.

"This brings the total government equity contribution in Broadband Infraco to R1.4 billion," the report says.

Essential asset

The report notes the Department of Public Enterprises has "determined" that, in order to achieve the goals of the Accelerated Shared Growth Initiative for SA, ensure higher ICT penetration and affordable broadband connectivity, government should continue to own and invest in communications infrastructure.

"Infraco will make available communications infrastructure and a network that will provide access for undeveloped areas and bandwidth requirements for specific projects of national importance, which could include scientific initiatives, such as the Square Kilometre Array Telescope project and the SA Research Network," it says.

The report notes the state-owned entity plans to deploy a multi-terabit/s West Coast submarine cable system linking SA with the UK. It is envisioned that this project will be a joint venture between government and the public sector.

Earlier this week, Seacom president Brian Herlihy said the organisation continued to engage in dialect with various governments on the African continent and would get involved if it made financial sense to its shareholders.

The report reveals Infraco`s full service network for national long distance connectivity is now operational. This follows the upgrade to a 10Gbps dense wavelength division multiplexing platform.