Race on to build new SA subsea cable

The race is on to build an undersea cable from Mtunzini to Cape Town after operator Seacom said it was “fairly well progressed”.

Last month, telecoms infrastructure provider Techteledata said that it is also in discussions to build a cable from Mtunzini to Cape Town, adding that it would also connect East London and Port Elizabeth in the process.

Musa Phungula, Techteledata managing director and founder, said that the cable system will provide redundancy between the cable systems which land on South Africa’s East Coast (SEACOM, EASSy and SAFE) and the West Coast (WACS and SAT-3).

In an interview with BusinessTech, Seacom CEO, Mark Simpson said: “One of the things we’ve also been looking at it whether we do a build around Cape Town to Umtunzini. We are fairly well progressed,” he said of the project.

“We would rather just get on and get it built rather than make announcements,” the chief exec said.

“We are working with a number of key partners, and investors. It’s not a go yet, but the build is relatively straight forward,” he said of the project.

“The economics are relatively good, it’s just about getting it funded,” Simpson continued. The company lead said that East London and Port Elizabeth might also become attractive landing points, but that would depend on terrestrial builds in those territories.

He said the project would add value to a number of current builds, with a host of carriers both locally, and internationally, likely to be interested.

Last month, Techteledata said it has a technology partner lined up, but would not divulge the name.

Phungula explained that his company also planned to build two 6,000 square meter data centres at Mtunzini and Yzerfontein.

He said that many large telecoms players have already shown an interest in the new project, and are keen to purchase capacity on the cable system and in the data centres.
The company lead said that Techteledata and the Development Bank of Southern Africa (DBSA) as well as the IDC were in talks for funding for the project.

The Development Bank distanced itself from the news and told BusinessTech that it could not comment on confidential discussions between it and its clients.

The IDC said it had provided Techteledata with a letter of interest indicating a conditional funding commitment or an indication of appetite to fund based on off takes on the company meeting several conditions such as securing of an operating partner, securing of equity, IDC due diligence, and credit committee approval.

Techteledata is planning to launch this project in July 2013.

The company said that the total project budget is $100 million (R893 million), adding that they welcome potential investors to join the project.

Phungula noted that he has previously worked as Solution Architect: Product Strategy & Business Development at Seacom.

Seacom however, told BusinessTech that it would not comment on whether or not this “particular person” was a former employee.

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Race on to build new SA subsea cable