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War brews over set-top box tender

Martin Czernowalow
By Martin Czernowalow, Contributor.
Johannesburg, 08 Jan 2015
USAASA says it is ridiculous to suggest the agency contacted 145 companies to attend the briefing on 2 December last year.
USAASA says it is ridiculous to suggest the agency contacted 145 companies to attend the briefing on 2 December last year.

Sparks continue to fly between the Democratic Alliance (DA) and the Universal Access and Service Agency of SA (USAASA), with the official opposition accusing the agency of choosing specific companies to participate in the set-top box (STB) tenders.

However, USAASA has hit back and rubbished suggestions that bid briefing for tenders related to the manufacturing of STBs for the country's broadcast digital migration project was attended solely by companies that were specifically invited to the session.

The Democratic Alliance (DA) has slammed the "low-key manner" in which the tender process - that closed on 6 January - was conducted.

Marian Shinn, shadow minister of telecommunications and postal services, alleges the manner in which the process was conducted sidelined many companies that would have submitted bids, and casts doubt over whether the process will be fairly adjudicated.

"Most of the 145 companies that attended the bidders' briefing meeting on 2 December 2014 were invited," she says, adding that of those who attended the bid briefing at the end of last year, only 10 submitted bids for the previous, lapsed tender, in September 2012.

"This would indicate that most of those who invested in the previous bid were deliberately kept in the dark. A tender of this size should have been widely publicised. USAASA didn't even put out a press release alerting interested industry players to the fact that the bid process was starting.

"I am sure all the IT [publications], at least, would've carried it, as there has been years' long interest in this hot topic. Why would they have neglected to do this if they didn't want to restrict it to those already earmarked as preferred bidders?"

Shinn adds USAASA may believe "it has ticked the right boxes in the process, but the holiday season timing and lack of publicity is inexplicable". She points out that, since issuing her statement, she has been contacted by some companies who would have liked to bid again, but because they found out about it too late to attend the compulsory briefing, were excluded from the bidding process.

Ridiculous suggestions

However, USAASA spokesperson Khulekani Ntshangase says it is ridiculous to suggest the agency contacted 145 companies to attend the briefing on 2 December.

Ntshangase explains, in accordance with clause 16 A.6.3 [c] of the National Treasury Regulations, issued in terms of the Public Finance Management Act 1 of 1999, as amended, USAASA gazetted the bid on 21 November 2014 to close on 19 December 2014. The bid was also advertised in the Sunday Times of 30 November 2014, and was available on the USAASA Web site.

"We did not phone anyone to attend the briefing. All the companies that attended the briefing did so as a result of the tender having been gazetted and subsequently advertised in the Sunday Times."

Ntshangase also rejects the DA's claims about the briefing and tender coinciding with the holiday season as an attempt to sideline companies that were not specifically earmarked to participate in the process.

"Government does not close. If there are companies that closed for the holidays at that stage, then it is their problem. We have had people contacting us to extend the closing date of the tender, which we did from 19 December to 6 January. But really, it is their problem if they were not ready in December."

Ntshangase also said earlier there are private sector companies determined to derail government's service delivery programme, including the issuing of tenders related to set-top boxes and broadcast digital migration.

"There are some who don't want us to issue these tenders, specifically those who are already manufacturing set-top boxes, or those in a position to start manufacturing, and they would like to see the market flooded with their own products."

While he did not want to name specific companies, he explains several private sector manufacturers have been requesting continuous extensions to the tender process, as they are "looking after their own interests".

No secret

A senior executive at a local electronics company - who attended the briefing and who wishes to remain unnamed - says "everyone" within the industry knew about the tender and the briefing session, adding it would be difficult to suggest USAASA did not follow the correct process.

"Perhaps they did not spend millions on marketing, but I would say that those who complain are probably just opportunists who wanted to participate in the tender.

"I'm not surprised that they are complaining, because the requirements to participate were fairly strict. But, perhaps the December timing did ensure that only those who are real industry players were ready to attend and participate."

The executive claims the tender was adequately advertised and the 145 companies that attended the bid briefing included all major players. "I would say that all the guys who should have been there were actually there."

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