Another multimillion-rand SNO deal signed

By Phillip de Wet for Ericsson

Johannesburg, 26 Oct 2001

Transtel has announced that it will award the contract to bring its telecommunications network up to scratch to Ericsson.

As in the deal between Eskom Enterprise and Siemens, details of the contract are still sketchy, but also similarly the project is aimed at preparing the Transtel network to form part of the national backbone for the second national operator (SNO) due in May next year.

Ericsson is to create a next-generation network based on its Engine solution, which it promoted heavily earlier this year in anticipation of an SNO contract.

The value of the deal has not yet been determined, but local Ericsson MD Jan Embro says it will be significant.

"It depends on how quickly they want it rolled out and what they are looking for right at the start," he says.

While Ericsson is officially only tasked with upgrading the Transtel network, Embro says his company will probably end up planning an integrated SNO network with Siemens. To do so, the company may have to suppress a measure of corporate resentment; Ericsson was among the competitors Siemens beat for the lucrative contract to roll-out Cell C`s cellular network.

Transtel says it chose Ericsson for its next-generation network credentials, but also for its mobile skills.

"They are also recognised as being the leading supplier in mobile networks, including third-generation networks, something that will be a major advantage for a fixed-mobile operator such as the SNO," said CEO Karl Socikwa in a statement.

The choice of partners may have far-reaching effects for both Eskom Enterprises and Transtel. Although it is now nearly certain that both will participate in the SNO, government is yet to value the infrastructure each will bring to the table. That value will determine the equity percentage awarded to each when the invitation to apply for the SNO licence is issued.