An IT specialist has called on the City of Joburg to abandon its broadband infrastructure ambitions and focus on its core responsibilities instead.
“I will be quick to acknowledge that we have shortage of water and electricity in Joburg, but not broadband,” said Rabelani Dagada, who is the DA spokesperson on Joburg Broadband Network Project, in an opinion piece.
He noted that several cities in South Africa have started projects that enable them to offer cheap ICT services to their residents.
And while many entities have succeeded in creating a sustainable business model, like the Knysna Town Council,and the eThekwini Metropolitan Municipality, Dagada believes that the City of Joburg has entered the broadband market far too late.
“South Africa has more than 350 licensed telecommunication operators, the City of Joburg wants to enter the telecommunications market as an operator – this does not make sense.”
He pointed out that the city’s efforts to establish a Public Private Partnership to manage the Joburg Broadband Network has failed dismally.
The municipality appointed Ericsson SA four years ago to build a 900kmoptic fibre network. The network has not yet gone live despite its original g-live date of July 2013.
This led to the City of Joburg to cancel the contract with Ericsson last year.
Dagada said that on 29th January 2015, the City Council of Johannesburg approved that the City should pay R1.1 billion as part of settling the termination of the contract with Ericsson.
The Johannesburg Municipality Council also approved the establishment a Municipality Owned Entity to operate and manage the Joburg Broadband Entity.
“It is well known that two of the top telecommunication operators in South Africa have not yet made profit after several years in the market. Chances that the entity responsible for the Joburg Broadband Network will successfully compete with more than 350 licensed operators and make any profit are zero.
“This proposed entity will not be self sustainable and thus it will consume the financial resources that the City can use elsewhere to provide infrastructure and social services to our people,” Dagada said.
He stressed that even those telecommunication operators that are making a profit, are being squeezed due tighter competition and an abundance of broadband.
“The truth is that South Africa is now surrounded by more than three undersea broadband cables. The private companies have already sourced this broadband inland and the bulk of it is lying underneath Joburg’s streets and the private sector telecommunication operators are currently connecting this network to corporate parks, offices and residences.
“This Municipality already has 15 entities and there are no compelling reasons or business case to establish an extra entity.”