Subscribe

Back to drawing board for digital tender

Nicola Mawson
By Nicola Mawson, Contributor.
Johannesburg, 13 Apr 2015
Only 100 000 set-top boxes will initially be made when the tender is finally awarded.
Only 100 000 set-top boxes will initially be made when the tender is finally awarded.

SA's much-delayed move to digital television has taken another step backwards, as the government agency responsible for procuring set-top boxes is now duplicating its own work, causing commentators to suggest unhappy parties are interfering in the process.

This has been revealed by two sources close to the manufacturing process, and contradicts a Friday report in Business Day that indicated all 20 bidders would share the overall R4.3 billion digital infrastructure contract. The contract was meant to have been awarded last month.

Business Day, quoting Universal Service and Access Agency of SA (USAASA) CEO Zami Nkosi, reported the agency's intention was never to award the bid to just one service provider, but to rather promote inclusivity and increase the manufacturing supply base.

SA has been moving towards digital TV since 2006, but will miss the International Telecommunication Union's mid-June deadline for migration.

ITWeb this morning learnt the tender has not been awarded; instead, all bidders have been informed they are on a short list, and asked to provide further information. One source notes a letter - sent to bidders around the beginning of the month - requests additional information such as pricing, warranty, delivery periods and test reports.

Unhappy bidders

This detail, which seemingly duplicates information required in USAASA's initial tenders as well as audit work done by Ernst & Young (E&Y) to ascertain manufacturing capacity among bidders, is due to be provided by midday tomorrow. In addition, it will take USAASA another two to three weeks to wrap up the process, and the initial order will only be for about 100 000 decoders.

ITWeb has also learnt six companies have been shortlisted to provide satellite decoders, and nine to provide terrestrial set-top boxes. Democratic Alliance shadow minister of telecommunications and postal services, Marian Shinn, says this duplication of effort is "bizarre". "Why are they doing it again?"

Shinn says this second process smacks of interference, as E&Y undertook "diligent" research that included site visits, ability to handle repairs, manufacturing capacity and a check of production lines. However, one faction of the National Association of Manufacturers in Electronic Components (Namec) has already lambasted USAASA's appointment of E&Y to audit bidders.

Namec, which has said it wants at least 60% of the deal for its members, says E&Y's mandate is a waste of money. The association, which was recently ripped in half after its own tender dispute around a set-top box deal, argues "financial accountants are not the best placed people to audit manufacturing processes, there are specialist in the field" and alleges the audit was rushed. It also argues other, unnamed, competitors may have been allowed to change pricing so that they can be considered.

Namec deputy secretary general Tony Booysen believes the tender has been awarded to 20 companies, but has no insight into what is happening at USAASA, nor whether there is any interference.

No information

However, ICT commentator Adrian Schofield says is appears as if somebody is desperate to include bidders that otherwise would not have qualified, under the guise of seeking additional information. "This is yet another inexplicable delay in the process of digital transformation."

Ovum analyst Richard Hurst adds the entire approach has been disjointed and fragmented, and beset by a general lack of clarity. "Service providers don't know where they stand from one minute to the next. Nothing is ever clear; nothing is ever delivered."

Attempts to obtain clarity from the Department of Communications - which has oversight of the project - and USAASA were unsuccessful. Hurst says the added wrinkle has taken the entire process a big step back. "One thing is clear: there will be more delays, no matter what."

Share