The report that will make recommendations on how to overcome challenges faced by underserviced area licensees (USALs) will be completed by the end of April, says Tebogo Tlapaase, Universal Service Agency manager of regulatory and corporate affairs.
Tlapaase says the report will also influence the allocation of this year`s R5 million subsidy to USALs. He says while the decision to allocate the subsidy would be based on whether they fulfilled the terms of their contract with the USA for the first year, there is no doubt that USALs face big challenges.
The fact that spectrum has not been allocated to USALs has affected their infrastructure plans, he says. Also, the way the USALs were set up poses challenges. For example, USALs are expected to operate in the low economic activity areas shunned by the big mobile operators, making it difficult to generate revenue from disadvantaged communities, he says.
He says USALs also face financing obstacles. It is natural that a financier would wish to own a stake in an enterprise that he is financing; however, the law places restrictions on strategic partnerships that USALs can form, he says.
"The aim is to empower previously disadvantaged people to own a stake in the telecoms sector. However, these are the same people who do not have funds to invest," he says.
Willie Fourie, head of the techno industries strategic business unit within the Industrial Development Corporation (IDC), says innovative funding solutions must be found to support USALs. He says the IDC has identified some USALs that it will fund.
Bule Mhlongo, CEO of Thinta Thinta, a USAL, says the company is in talks with the IDC for a R52 million funding agreement.
The Independent Communications Authority of SA has confirmed it has awarded Thinta Thinta a test licence for channel 65.
Related stories:
Naivet'e compounds USALs` problems
Potential for high ICT ROI in Africa
Agency hands R5m to USALs
Share
