Subscribe

SNO bidder promises delivery in three months

By Georgina Guedes, Contributor
Johannesburg, 18 Jul 2003

"If all goes well, we could have SNO by Christmas," jested Mike van den Bergh, a director of CommuniTel, in reference to his consortium`s confidence that should it be granted the second national operator (SNO) licence, it will be able to roll-out the first services within three months.

Van den Bergh was speaking during the first day of the second national operator (SNO) hearings that took place at the Sandton Crown Plaza yesterday. CommuniTel presented its case and fielded questions from other stakeholders, its competitor Two Consortium, the Independent Communications Authority of SA and the public about its bid for the SNO licence. The tables will be turned today, with Two Consortium coming under the spotlight.

"We can deliver services three months after the flag is dropped because we already have a war room established, we have mapped the steps we need to take, we have realistic plans and we`ve done the homework," said Van den Bergh.

He explained that CommuniTel has hinged its plans on a conservative "worst-case scenario" approach, which he maintains has still managed to gain the backing of funders because it is "focused and prudent". However, the consortium has greater faith in the market than is reflected in its plans. "We believe we can do better," Van den Bergh said confidently.

Projection discrepancies

A major bone of contention at the hearing was the discrepancy between the two consortiums` projections of the telecoms market over the next 10 years. CommuniTel estimates the market at R65 billion, while Two Consortium puts it more conservatively at R35 billion.

Van den Bergh explained the discrepancy: "Two Consortium has used figures that are largely out of date, not reflecting how the economy is changing. We spent six weeks in due diligence with Eskom and Transtel. We have in-depth knowledge of the necessary people and skills. We have cross-validated all our figures with Telkom`s. We know we can make it work."

BEE conflict

A representative from Nexus, the 19% equity partner in the SNO, raised concerns about potential conflict between itself and CommuniTel`s 25% equity partner, the Mkhonto we Sizwe Military Veterans Association.

"We understand Nexus`s concerns, but they are unfounded," said Van den Bergh. "CommuniTel is already comprised of very disparate groups, but we have a cultural fit which encourages an integrated result. The more black empowerment we can create as a result of this venture, the better."

Progress through partnership

CommuniTel`s strategic partners include British Telecom and Deutsche Telekom. The plan is to transfer the skills learnt in building and running SNOs worldwide to local South African management as quickly as possible.

"Our solid business model and lack of legacy infrastructure will enable us to generate significant economic benefits in terms of improved competitiveness, together with the ability to stimulate downstream industries, job creation and improved consumer satisfaction," said Deacon Mathe, chairman of CommuniTel.

CommuniTel committed to creating 5 600 new jobs, absorbing all the staff of state-owned enterprises into the SNO with no retrenchments, and providing a clearly defined quality of service and guaranteed delivery to the end-user.

Related stories:
SNO hearings kick off
SNO bidders neck-and-neck in final race
SNO could be known in six weeks

Share