Undersea cables landing in SA must have an element of local ownership for security purposes and to stimulate the country's development, says Department of Communications director-general Lyndall Shope-Mafole.
Her comments come in light of reports that government is planning to block Neotel from landing a Seacom cable in SA.
In an interview with ITWeb this morning, Shope-Mafole says her department is not, in principle, opposed to commercial cables landing in the country and offering prices that are far lower than the prevailing rate. However, this should not be done at the expense of SA's own economic development, she notes.
"Many countries have such stipulations. For instance, Canada and India have similar requirements about undersea cables landing there. We also don't want our connectivity to be under the control of a 100% foreign-owned company that does not allow our own African companies to participate."
Seacom is planning an East Coast cable and has formed an alliance with second national operator Neotel to land in this country by the first quarter of 2009. It has said its prices will be pegged at around 80% below that of Telkom's current prices.
Price reductions
Last week, Seacom admitted it had made an offer based on that pricing to the Tertiary Education Network.
Seacom is a consortium of a small number of East African and European telecommunications companies that has the backing of The Blackstone Group, the world's largest private equity company.
"One has to ask how they can reduce prices by so much. And one way in which they can is that they go directly to the end-user," Shope-Mafole says.
She adds that Seacom is directly linked into "a global cable monopoly and we cannot allow this to perpetuate at home".
The world's largest cable operator is VSNL International, through its acquisition of Teleglobe Canada. VSNL owns a 26% stake in Neotel, but does not seem to have a direct stake in Seacom.
Moving forward
Shope-Mafole says planning for the Nepad ICT Broadband Infrastructure Network's own East Coast undersea cable is going ahead.
"We are looking at a 1.2TB capacity cable that will run along the East Coast and have made provision for it to land in all countries, even those that have not yet signed the Nepad protocol," she says.
Eleven out of the original 23 countries that agreed to it have signed the Nepad protocol. Only two, SA and Rwanda, have ratified it.
Shope-Mafole says Seacom, if it received more local investment, would also be "accommodated in the Nepad cable project".
Prohibited exclusivity
Speaking about the creation of the Department of Public Enterprises' broadband infrastructure supplier Infraco, which is planning two West Coast cables, Shope-Mafole says the exclusivity agreement goes against the Electronic Communications (EC) Act.
"The EC Act specifically prohibits the perpetuation of monopoly activity and so you can't have exclusivity such as that," she says.
Infraco has taken over the Easitel and some of the Transtel assets that were originally earmarked for Neotel. The parties have signed a four-year exclusivity deal, of which details remain secret.
Hearings into the law that will govern Infraco are due to resume in Parliament tomorrow.
Related stories:
Cable talks turn 'sensitive'
Undersea cable war begins
Seacom targets 'aggressive' broadband prices
Parliament rejects Infraco
R5bn for West Coast sub cable
Nepad to lay own undersea cable
Share