US-based Infinity Worldwide Telecom Group of Companies is on the verge of finalising a $865 million funding package to finance a cable project running along the West Coast of Africa, connecting Portugal with SA.
The cable project is part of the Project West Africa telecommunications infrastructure initiative. The African expatriates aim to bring high-speed connectivity to West Africa through a fibre cable which connects the African continent with Europe, Asia and the US.
The initial phase of the project involves the construction of a 14 000km fibre route along the western coast of Africa, with direct links between Lisbon, in Portugal, and Cape Town, in SA, says Infinity COO Robert Woog.
Branching units from this connection are to land in Senegal, Liberia, Cote d'Ivoire, Ghana, Benin and Nigeria, the company says. The cable would become commercially available at the end of 2010.
The route duplicates that of SAT-3, offering competition for the privately owned cable project that has been widely criticised for artificially inflating its access charges and giving preferential treatment to SAT-3 owner telcos.
By contrast, Infinity has pledged to conform to an open access policy, welcoming all service providers on an equal basis, says Woog.
Secondly, it is not asking for public funding, he explains. A third benefit is that the cable will travel from city to city, rather than cable landing station to cable landing station, says Woog.
This provides direct capacity to the rest of the world, as well as regional capacity by bringing cable into each country.
"The above aspects of our plan will correct many of the strong objections that regulators have with the SAT-3 system, difficulties that are normally experienced by customers of consortium systems," says Woog.
Project-ready
Infinity previously said it needed $750 million to construct the cable, with the rest of the money to be used for operational expenses.
Woog says the company has been working to convince the marketplace and investors of the need for an additional fibre optic cable along the western coast of Africa for a number of years.
It first introduced Project West Africa at a Nepad conference in Dakar in 2005, he says.
Gaining funding commitment for the cable project will put it in a strategic position to approach African regulators, including SA, about requirements to land cable in their territory, he says.
"The African regulators we have met with advised us to first conclude our financial arrangements prior to entering into more detailed discussions on landing licences and other permits. We can clearly understand this point to conserve the critical time of these government officials so that they can focus on legitimate projects rather than those that are speculative."
That advice is also the reason Infinity has not yet requested a meeting with SA's Department of Communications (DOC) to discuss requirements for international projects to land cable in SA, Woog notes.
"We are greatly looking forward to coming to SA with our demonstrable, fully-funded project to discuss how we can conform to all South African regulations and to land expeditiously in SA.".
Compliance issues
The DOC notes Infinity will have to comply with SA's guidelines on the rapid deployment of electronic communications facilities, which were drafted in terms of section 3 (1) and 2 of the Electronic Communications Act of 2005.
The guidelines are still under development, with stakeholders invited to provide written comment until 11 April.
The regulation requires that all international cable projects wishing to land in SA be in possession of an electronic communications network service licence, as well as being majority-owned by Africans.
Woog notes Infinity was founded by Africans and the management control of the company is African, complying with the 51% African ownership in the rapid deployment regulation.
It has also read and tried to keep abreast of the various opinions and views of different South African officials as they discuss various draft regulations, he adds.
"We have particularly followed with interest the approach taken by Seacom to land in SA."
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