2010 ICT-spend goal needed

By Christelle du Toit, ITWeb senior journalist

Johannesburg, 18 Jan 2008

Government's spend on 2010 is top of mind for many analysts, as the finance minister prepares to deliver his budget speech in Parliament next month.

With the public being called upon to submit their "Tips for Trevor" to minister Trevor Manuel, analysts are eagerly anticipating clarification on how much government is to spend on ICT for the sporting event.

Consulting firm Frost & Sullivan ICT analyst Lettitia Nkumbula says she has a couple of pointers for Manuel. Firstly, she says he could boost the open source market significantly by allocating it specific funds.

"Based on an estimated 30% market penetration of Web-based open source collaborative applications in the SA collaboration tools market (vis-`a-vis a 70% niche for desktop-based applications), Frost & Sullivan believes the market would transcend the current 'growth plateau' phase and derive a significant impetus/benefit from a substantial capital injection," says Nkumbula.

"Accordingly, I would recommend an allocation of at least 30% of the software development/integration budget (if there is one) to open source solutions. Needless to say, the SA software industry and particularly the open source market would derive a significant multiplier effect from such an investment."

She also says 2010 is the ideal vehicle through which to integrate "currently disparate and standalone municipal ICT plans".

"I think the current state of under-preparation, owing to a lack of focused ICT plans in municipalities, can be alleviated by a fixed minimum allocation for municipal ICT investment. The long-run effect of such an intervention is the introduction of parity and a necessary bolstering of currently weak municipalities."

Lastly, Nkumbula says over-capacity in the technology arena beyond 2010 can be addressed through "focused infrastructure investment on significantly underprivileged or laggard regions [which] would create capacity for the uptake for the residual capacity".

Market speculation has been that 2010 ICT spend will be in the region of R3 billion to R5 billion. While not clarifying this figure, deputy minister of finance Jabu Moleketi has hinted it could be much more. He said all would be revealed during the next budget presentation.

Research firm ForgeAhead predicts government spend in the next year on IT in general will be in the region of R45 billion, 10% up on the previous year, and will be driven mainly by 2010 projects.

Helping the regulator

According to Ray Webber, spokesman for the Communication Users Association of SA, another major issue that should be raised with Manuel is that of the Independent Communications Authority of SA (ICASA).

"Manuel has to ensure ICASA has the funding, independence and resources to enable them to perform as an effective regulator of the communications industry in SA," says Webber.

MarketWorx CEO Craig Terblenche echoes his sentiments: "ICASA needs help and the minister should allocate the funds to address this."

Terblenche says: "I do not profess to have all the answers to what help and how much help they [ICASA] need, but, at the risk of being hung out to dry, I question the sense in allocating a pay-TV licence to Telkom when it is not adequately addressing the provision of reliable telecommunications infrastructure for business and consumer demand at a globally competitive price (which should be Telkom's core focus). There is much evidence of Telkom's inefficiency."

Sentech in need

Terblenche also identifies infrastructure as a major area of concern.

He says the telecommunications operating environment is in dire need of assistance and "top of the pile has to be the Sentech network upgrade, first announced in July 2006, and still fumbling in July 2007".

Sentech initially requested between R600 million and R1 billion to build a wireless broadband network, but its allocation of funds has been repeatedly delayed. In September, the organisation received R500 million from Manuel, but said it needed more. Last year, Sentech said it hopes to unlock funds in the first quarter of 2008, after submitting a revised business plan to the Department of Communications.

According to Terblenche, "time is running out" for Sentech to sort out the digital readiness of the television network to accommodate the 2010 World Cup, as well as its network. He says "substantial help" is needed in this regard and can come from the national treasury's Technical Assistance Unit.

The public can fill in an online form, send a fax to (012) 315-5126, or e-mail the minister, to make their contributions to "Tips for Trevor".