Telkom's R13 billion network upgrade has come to a grinding halt, after the North Gauteng High Court ruled on Friday that it had to engage in dispute resolution with one of the losing bidders.
Telkom announced last week that it had started replacing outdated DSLAM boxes with newer technology as part of its plan to move to an all-IP network designed to enable fixed-mobile convergence and truly differentiated high-speed broadband.
The tender was awarded to Huawei and Alcatel Lucent. However, neither the South African Communications Union (SACU) nor losing bidder ZTE Mzansi are happy with the company's network transformation plans.
ZTE Mzansi director Tumi Magosa says Telkom's bidding process was not fair and the company's tender was never properly considered, despite complying with all of Telkom's requirements, including empowerment and technical capability.
Earlier last month, ZTE Mzansi took Telkom to the North Gauteng High Court, in Pretoria, asking that the court urgently stop Telkom from carrying on with the transformation. On Friday, a judgement was handed down in ZTE's favour, says Magosa.
Not fair
service access nodes (MSANs) as part of its network revamp.
ITWeb understands the tender was for a two-phased implementation. The first part - to replace the MSANs - is worth around R5 billion, while the second phase will move the entire network to IP. In total, the deal is worth around R13 billion over about five years.
Telkom's network revamp includes work completed on network operation centres; the transmission network constructed for the 2010 Fifa World Cup; the upgrade of international bandwidth such as the West African Cable System cable, due to enter service later in 2012; and a technical skills transformation programme also under way.
Magosa argues that the turnkey contract to turn Telkom's current network into converged IP-based infrastructure was improperly awarded. He says ZTE Mzansi was disqualified from the bidding process, despite meeting all of Telkom's criteria.
Telkom also never allowed ZTE Mzansi, 40% owned by China-based ZTE, the opportunity to point out, during a clarification session, that it met all of Telkom's criteria, Magosa argues. He alleges that other bidders had the opportunity to clarify aspects of their proposals.
Michael Hare, SACU president, says the union is meeting with Telkom and will “request a probe into this tender process, as well as the lack of transparency”. Telkom says it is “reviewing the contents of the judgement and will revert when it is appropriate to do so”.
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