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Tender squabble to derail digital migration

Nicola Mawson
By Nicola Mawson, Contributor.
Johannesburg, 24 Mar 2015
The allocation of more spectrum and the opportunity to create jobs will be delayed if the set-top box tender is pushed out.
The allocation of more spectrum and the opportunity to create jobs will be delayed if the set-top box tender is pushed out.

Political infighting and the promotion of vested interests are factors that will seemingly derail SA's digital migration process - yet again - much to the disgust of commentators.

This comes as news emerges that awarding the set-top box tender - needed before SA can turn on digital TV - could be delayed again because the Department of Communications (DOC) reportedly wants to pull it in-house, and probe the initial tender process.

According to TechCentral, Solly Mokoetle, programme head of digital terrestrial television within minister Faith Muthambi's office, the tender process for the supply of at least five million free decoders should be handled by the department.

Mokoetle, who left his post as CEO of the South African Broadcasting Corporation, under a cloud in 2011, is also quoted as saying the current tender process needs to be probed. The tender - said to be worth R4.3 billion - at the heart of this squabble is being adjudicated by the Universal Service and Access Agency of SA (USAASA).

Several attempts by ITWeb this morning to contact Mokoetle were unsuccessful, as his phones rang through to voice mail. He also was not available for a scheduled meeting yesterday afternoon.

Crying foul

USAASA's tender has come under fire recently, with one faction of the National Association of Manufacturers in Electronic Components (Namec) arguing the process is flawed. Namec, which has said it wants at least 60% of the deal for its members, says USAASA's appointment of E&Y to audit manufacturing capabilities of the 17 companies that responded to the bid is a waste of money.

The association, which was recently ripped in half after its own tender dispute around a set-top box deal, argues "financial accountants are not the best placed people to audit manufacturing processes, there are specialist in the field" and alleges the audit was rushed. It also argues other, unnamed, competitors may have been allowed to change pricing so that they can be considered.

Ovum analyst Richard Hurst says the 11th hour intervention smacks of vested interests, spite, and malice. It is a case of: "If I can't have it [the tender] there's no way in hell you can have it." He adds the delay will set back migration by "years" and will have dire consequences for the country.

Among the consequences Hurst cites is cutting off the man-in-the-street from the digital economy because the digital dividend - which will free up much-needed spectrum - will be delayed. In addition, he says, the potential to create jobs through migration and the emerging manufacturing sector will be lost.

Hurst says the ongoing debacles around migration - which has been on the cards since 2006 - makes SA look like it cannot get its act together. The latest hurdle, which emanated in 2012 over set-top box controls, was only unsatisfactorily resolved this month. "It's just another delay; gosh, that's just what we need," quips Hurst.

The Democratic Alliance's (DA's) shadow minister of telecommunications and postal services, Marian Shinn, adds she has no idea what Mokoetle is trying to do now as the winning bidders are meant to be announced soon. "We actually just have to move on with this."

Shinn notes the tender process has been ongoing for some time and questions why Mokoetle is only just waking up now. She says any delay in awarding tenders will push SA's migration back four years, while the international deadline to switch off analogue is now less than three months away.

No authority

USAASA has also hit back at Mokoetle's statements, calling him a "junior" within the department without the "authority to make such declarations". It adds it is aware of "the intention of some in the sector to delay" migration. "It is a pity Mokoetle has played into those tactics at the cost of the country."

The agency adds it is also aware of service providers, which did not bid, having been promised the procurement process will be stopped; a situation it says is unfortunate as the DOC has no legal jurisdiction over USAASA. The initial tender closed during SA's traditional quiet period last December.

USAASA adds it reports to the Department of Telecommunications and Postal Services, and not the DOC. "It is perhaps prudent that Mokoetle start first by seeking the permission of minister [Siyabonga] Cwele before misleading his stakeholders and the public at large. It is truly unfortunate that private interests have penetrated the public realm and resulted in seemingly desperate utterances as this."

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