State signals provider Sentech is giving up on its plan to create a national wireless broadband network for now and is giving spectrum back to the regulator.
Addressing journalists this morning on its three-year strategy, CEO Setumo Mohapi says the entity has decided to give back spectrum in 2.6GHz and 3.5GHz while it waits for clarity from government as to what role state-owned entities will play in the broadband space.
In the meantime, he says, Sentech will work with the industry and the Department of Communications regarding the development of an overarching strategy.
In addition, notes Mohapi, the entity saw a tenfold increase in the cost of spectrum after the Independent Communications Authority of SA (ICASA) revised spectrum fees last April. He says the fee went from R4 million to R40 million.
Mohapi adds that National Treasury last November told Sentech that it had to return money set aside for the network, worth just more than R500 million, to the National Revenue Fund. In total, Sentech returned R584 million, which included R21 million for investment in a cable, and interest.
Currently, the sector is waiting for the Department of Communications to wrap up a policy directive and regulations around high-demand spectrum, which had been released and then withdrawn, says Mohapi. It is also waiting for policy on broadband from the department, which has set a target of universal access by 2020.
In March 2011, Sentech indicated it would start rolling out its long-awaited national wireless broadband network by the third quarter of that year. The network has been on the cards, in one form or another, for around six years.
Sentech aimed to spend a total of R814 million in infrastructure on the national wireless broadband network. It said the project aimed to improve broadband penetration to match SA's comparative counterparts such as India, Brazil and Chile.
According to its 2011 strategy, the network is needed because there is not enough broadband available in SA, which Sentech said is because of "market failure".
Sentech was set to focus the project on schools, which is where it saw the greatest need. In the first year, it would focus on KwaZulu-Natal and aimed to cover 1 254 schools. The next year, Limpopo will be covered with 7 352 schools, followed by 15 023 schools in Mpumalanga and the Eastern Cape in the 2013/14 financial year.
Mohapi says the proposal was based on open access, and could have been constructed under a public: private partnership model. He adds that all state-owned entities that provide connectivity are set to be reviewed, which could change the nature of Sentech's involvement.
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