African operators to build new $400m undersea cable
Jonah Iboma
Grahamstown, South Africa
Leading African mobile telecommunications operators have signed a $400m pact to build an undersea fibre optic cable infrastructure that would complement the current but insufficient SAT3 in operation. The new cable will run from the West Africa coast through the rest of Africa.Leading operators in the pact which include Vodacom, Telkom, MTN, Broadband Infraco and Neotel said on Sunday that they signed a deal worth more than $400 million (about R3.12 billion) to build a 5.1Tb cable to land in as many African countries on the West Coast as possible. The new venture is expected to increase the already emerging competition in the undersea cable business. Due to dissatisfaction with SAT-3, the only undersea cable serving most of the countries in West coast of Africa, a number of new ventures had started to provide alternative services. Among these ventures are Infinity Cable promoted by Infinity Worldwide Group based in Granada; MainOne Cable promoted by MainStreet Communications Nigeria and Glo-1, a project of Globacom Nigeria. The new joint venture will enter into negotiations with the representative telecommunications operators. In some countries, the participants already have landing rights such as those that have already been granted to Telkom and MTN by Nigeria.Details of the deal which was put together in a memorandum of understanding signed by all the parties, said that the new infrastructure will be code-named "Cable-X". This will ensure international connectivity, reduced costs of bandwidth and the savings are passed on to consumers. Using the traditional telecommunications model, the financial structure will see all parties contribute an equal amount to the project. This will give them an equal share of the capacity. The cable is expected be renamed and three alternatives were presented at the Sunday's meeting. The first is African Cable Enterprise, the second is West African Cable System, and the third is Fusion, symbolising the concept of the five shareholders coming together. Sources say the cable will stretch from Telkom's Melbosstrand landing station, just outside Cape Town, and terminate in Europe. The next step for the parties is to form a joint venture company, and sign a construction and maintenance agreement that will detail the construction timeline, set an operational date and appoint a company to survey the route and build the cable. Sources close to the negotiations say this deal effectively combines what Broadband Infraco, championed by the Department of Public Enterprises, was trying to achieve, but failed to because of its cumbersome financing structure.The project replaces Telkom's SAT-4 cable project, which it had been planning for some time, and would have been modeled on its previous systems, such as the current SAT-3 system.The deal also excludes any other international player making a move to link up one of the fastest growing telecommunications markets in the world – the African hinterland. United States Internet giant Google was in discussions with some of the individual parties, but these talks have now ended.Sources said the joint venture met the government objectives and the DPE plans in terms of reducing connectivity costs. An official release announcing the joint venture is expected either later on Monday or Tuesday, following a briefing by the joint venture to the South African Department of Communications.However, it effectively snubs the DoC's own pet project, Uhurunet, which aims to encircle the continent with fibre optic.Twelve countries, 10 of which are Southern African Development Community members, have signed the protocol governing Uhurunet, but only six have ratified it.During a parliamentary press briefing on Sunday Deputy Director-General for ICT Infrastructure, Keith Shongwe said Uhurnet was making progress.He said representatives from Nigeria and Kenya were due to meet with the Uhurunet consultants, the US company 5P, this week to sign a memorandum of understanding over their participation.
Grahamstown, South Africa
Leading African mobile telecommunications operators have signed a $400m pact to build an undersea fibre optic cable infrastructure that would complement the current but insufficient SAT3 in operation. The new cable will run from the West Africa coast through the rest of Africa.Leading operators in the pact which include Vodacom, Telkom, MTN, Broadband Infraco and Neotel said on Sunday that they signed a deal worth more than $400 million (about R3.12 billion) to build a 5.1Tb cable to land in as many African countries on the West Coast as possible. The new venture is expected to increase the already emerging competition in the undersea cable business. Due to dissatisfaction with SAT-3, the only undersea cable serving most of the countries in West coast of Africa, a number of new ventures had started to provide alternative services. Among these ventures are Infinity Cable promoted by Infinity Worldwide Group based in Granada; MainOne Cable promoted by MainStreet Communications Nigeria and Glo-1, a project of Globacom Nigeria. The new joint venture will enter into negotiations with the representative telecommunications operators. In some countries, the participants already have landing rights such as those that have already been granted to Telkom and MTN by Nigeria.Details of the deal which was put together in a memorandum of understanding signed by all the parties, said that the new infrastructure will be code-named "Cable-X". This will ensure international connectivity, reduced costs of bandwidth and the savings are passed on to consumers. Using the traditional telecommunications model, the financial structure will see all parties contribute an equal amount to the project. This will give them an equal share of the capacity. The cable is expected be renamed and three alternatives were presented at the Sunday's meeting. The first is African Cable Enterprise, the second is West African Cable System, and the third is Fusion, symbolising the concept of the five shareholders coming together. Sources say the cable will stretch from Telkom's Melbosstrand landing station, just outside Cape Town, and terminate in Europe. The next step for the parties is to form a joint venture company, and sign a construction and maintenance agreement that will detail the construction timeline, set an operational date and appoint a company to survey the route and build the cable. Sources close to the negotiations say this deal effectively combines what Broadband Infraco, championed by the Department of Public Enterprises, was trying to achieve, but failed to because of its cumbersome financing structure.The project replaces Telkom's SAT-4 cable project, which it had been planning for some time, and would have been modeled on its previous systems, such as the current SAT-3 system.The deal also excludes any other international player making a move to link up one of the fastest growing telecommunications markets in the world – the African hinterland. United States Internet giant Google was in discussions with some of the individual parties, but these talks have now ended.Sources said the joint venture met the government objectives and the DPE plans in terms of reducing connectivity costs. An official release announcing the joint venture is expected either later on Monday or Tuesday, following a briefing by the joint venture to the South African Department of Communications.However, it effectively snubs the DoC's own pet project, Uhurunet, which aims to encircle the continent with fibre optic.Twelve countries, 10 of which are Southern African Development Community members, have signed the protocol governing Uhurunet, but only six have ratified it.During a parliamentary press briefing on Sunday Deputy Director-General for ICT Infrastructure, Keith Shongwe said Uhurnet was making progress.He said representatives from Nigeria and Kenya were due to meet with the Uhurunet consultants, the US company 5P, this week to sign a memorandum of understanding over their participation.
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