Undersea cable war begins

The Department of Communications is poised to make policy announcements aimed at severely curtailing Neotel's ability to land the Seacom East Coast cable in SA, sources say.

Communications DG Lyndall Shope-Mafole is meeting this morning with her department's portfolio organisations, which include Telkom, Sentech and the SABC, to inform them of the Cabinet decisions taken at the lekgotla (policy meeting) earlier this month.

It was at the conclusion of that lekgotla that president Thabo Mbeki announced government's broadband infrastructure supplier, Infraco, would land two 3Tb cables in SA - one from Brazil and the other from Europe. Infraco is a Department of Public Enterprises initiative.

At a press conference in July, Shope-Mafole indicated government was not in favour of commercial cables such as Seacom and its potential rival Eassy (the East African Submarine Cable System) landing in SA. She noted the Nepad Broadband Infrastructure network was considering laying its own East Coast cable.

At the time, Shope-Mafole said government did not believe commercial cables would bring down the cost of broadband in SA and government initiatives would be needed.

Announcements expected to be made by the communications department include placing all future international cable landing sites under direct government control, with priority given to government's own projects in terms of which cables will be landed.

However, there is no consensus on this view within government, because the Electronic Communications Act, which opens up cable landing sites to competition, would have to be amended. This, sources say, would be a lengthy process.

Seacom recently announced the start of its marine survey and the signing of a construction agreement for the 13 000km project.

This, it says, involves the construction of an undersea fibre optic network providing high-capacity bandwidth connectivity between SA, Madagascar, Mozambique, Tanzania, Kenya, India, the Middle East and Europe.

"Seacom and Neotel recently announced agreement of commercial terms for the partnership of landing the cable system in SA. Through the partnership, Neotel will own the cable landing station and all facilities within the South African territory.

"Neotel will operate the facilities on an open access basis; Neotel and Seacom believe such a policy will stimulate the South African international bandwidth market and make available affordable bandwidth to South African customers," Seacom adds.

Meanwhile, the Seacom/Neotel alliance announced this morning it has jointly offered Tenet discounted pricing on bandwidth from SA to Europe.

Tenet is a not for profit entity that runs a national research and education network on behalf of 40-odd research and educational institutions in SA and surrounds.

The discounted rates would see Tenet pay roughly R30 per Mb, hundreds of times less than the price it is currently paying Telkom.

According to a Seacom statement: "In the proposal, Seacom would provide international connectivity from Europe to Mtunzini and Neotel would provide national connectivity from Mtunzini to Johannesburg for distribution to academic institutions around the country."

In terms of the proposal, local research and educational institutions will, through Tenet, be able to access 10Gb of the Seacom international bandwidth capacity in Johannesburg via the Neotel national network.

"Additionally," says the statement, "an option has been granted for an additional 10Gb of Seacom's international bandwidth capacity for Tenet to make available to other southern and east African research and education networks through the UbuntuNet Alliance."

Says Tenet CEO Duncan Martin: "Tenet acknowledges that it has received a very attractive offer from Seacom/Neotel and is currently busy with due diligence processes."

Seacom president Brian Herlihy says the company sees this as an opportunity to make a difference to the face of education in Africa.

"Seacom hopes our actions signal our intention to meet the policy objectives of African governments and Nepad.

"While our commercial pricing will deliver affordable infrastructure for the growth of the ICT sector, in particular business process outsourcing and call centres, we have made this special concession to ensure the growth of research industries and education networks.

"This offer to Tenet will enable the universities and research institutions of SA, as well as those of other countries of eastern and southern Africa, to participate in the global research and education networking community on a scale that is totally impossible today."