Getting around the anti-infrastructure law

The law is a stumbling block to the deployment of ICT infrastructure by the provincial government.

Read time 5min 00sec

As I write this Industry Insight, cellphone giants MTN and Vodacom are in court to fight the Independent Communications Authority of South Africa's (ICASA's) intention to implement regulation on mobile termination rates (interconnection fees). They're concerned this will reduce their profits.

Truly speaking, the reduction of termination rates will not even make a dent on the massive profits of MTN and Vodacom. I am on the side of ICASA on this one. The dominance of these two mobile operators and the erstwhile monopoly of Telkom have led to exorbitant telecommunications costs. This has had an adverse impact on the socio-economic endeavours of the needy. The cost of doing business in South Africa is partly exacerbated by the ridiculous telecommunications costs, and entrepreneurship cannot thrive in this kind of environment.

Other than the anti-competitive behaviour of MTN and Vodacom, the government has contributed to the high cost of telecommunications by passing the State Information Technology Agency Act, 1998. In my view, this law is a stumbling block to the deployment of ICT infrastructure by the provincial government.

During the interviews I conducted with IT managers in district and local municipalities in Limpopo, it became clear there were no intentions or plans to roll out a broadband infrastructure at the local government level. This was confirmed by the information contained in the IDPs (integrated development plans). Both districts and local municipalities mainly see ICT as a support function rather than one of the drivers for community and economic development.

It is on this basis that almost all ICT activities are reduced to office equipment and related software. There are some wireless links at a rudimentary level (local area networks).

Tech terminology

However, things are different at provincial level, where, for the past few years, there have been efforts to implement a shared wide area network infrastructure. ICT-related documents in provincial government contain all the right phrases, jargon and thinking. These include words such as 'global digital economy', 'e-government strategy', 'e-Limpopo' and 'bridging the digital divide'.

The Office of the Premier perceives ICT as both the catalyst and driver for community and economic development. It is perhaps on this premise they see the rollout of the provincial telecommunications network as an investment that will yield return on investment in terms of real money and value (a better life for the people).

Limpopo, a province that is mainly rural, is the only province other than Gauteng that has made some progress in terms of a business case for a broadband network. However, the actual implementation has stalled. During my impromptu chat with a senior official in the Provincial Government Information Technology Office, he indicated the province is facing opposition from the State Information Technology Agency (SITA). He claimed the provincial government and SITA were jostling for the turf; SITA is arguing that it is its responsibility to roll out the broadband network as part of its mandate. A brief overview of SITA follows to put this matter into context:

"SITA was established in 1999 to consolidate and co-ordinate the state's information technology resources in order to achieve cost savings through scale, increase delivery capabilities and enhance interoperability. SITA is committed to leveraging IT as a strategic resource for government, managing the IT procurement and delivery processes to ensure that the government gets value for money, and using IT to support the delivery of e-government services to all citizens. In short, SITA is the IT procurer and manager for the largest employer and consumer of IT products and services in South Africa - the government." (

Moreover, the Act distinguishes SITA's services into mandatory services (that is SITA must provide), and non-mandatory services (that is SITA may provide). The provision and maintenance of PTN/VANS (public telephone network/value-added network services) forms part of the mandatory services, and this is perhaps why the Limpopo Provincial Government is experiencing a problem.

I am on the side of ICASA on this one.

The question is how did the city metros (Cape Town, Johannesburg, eThekwini, Tshwane and Ekurhuleni) and a local municipality (Knysna) build their own broadband network if it is the responsibility of SITA to do so? The answer to this question can be found in the SITA Act; SITA's present mandate is confined to the national and provincial spheres of government. However, municipalities can voluntarily engage in a partnership with SITA.

On the other hand, the Gauteng Provincial Government has awarded a tender for the deployment of its own broadband network, called the Gauteng Broadband Network (GBN). The GBN is deployed through Gauteng Growth and Development Agency (GGDA). GGDA is an independent operational company and its shareholder is the MEC of the Department of Economic Development in the Gauteng Provincial Government.

Although SITA would have objected to the implementation of the project by the provincial government itself, it could not do so when it comes to GGDA. The implementation of ICT infrastructure by Gauteng and other provincial governments would contribute to the decline of telecommunications costs.

Like Gauteng, other provincial governments that have ambitions to deploy ICT infrastructure should get around the SITA Act by establishing private companies that would implement such infrastructure. These companies will be funded by provincial governments, development finance institutions and other private sources. Meanwhile, I hope the mobile operators will eventually have their termination rates lowered.

Rabelani Dagada

fellow at the South African Institute of Race Relations.

Rabelani Dagada is a fellow at the South African Institute of Race Relations. He holds a master’s of computer-based education from the Rand Afrikaans University, a master’s of commerce in information systems from the University of the Witwatersrand, and a PhD in information systems from the University of South Africa. He is on Twitter: Rabelani_Dagada

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