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Massive infrastructure challenges lie ahead if we are to implement the SA Connect broadband policy as tabled two years ago.
Yesterday (6 December) marked two years since the South African national broadband policy was published. This week, ICT research and consulting company BMI-TechKnowledge (BMI-T) concluded a body of work, measuring the status of broadband rollout against the SA Connect targets, quantifying the key numbers associated with alternative solutions that could achieve these goals, and calling for the coming together of all stakeholders to ensure the success of SA Connect.
BMI-T’s aim in producing the report is to identify opportunities for industry, reality-test the targets and get some idea of the scale of the funding needed to fully implement SA Connect.
Denis Smit, MD of BMI-T and a veteran of the local ICT industry comments: “This is the most comprehensive, and to our knowledge, the only available review of progress under SA Connect to date within the private sector.”
SA Connect was originally seen as being ambitious and far-reaching, setting targets of 100% broadband connectivity for all schools, health facilities and government facilities by 2020, with higher speed targets by 2030. The policy aimed to provide access to broadband for 90% of the population by 2020 and 100% by 2030.
The study has found that progress to date has almost entirely been limited to various unco-ordinated initiatives by provinces and metros.¬† “Our analysis confirms that the achieving the 2020 targets is already at risk, and that even meeting the 2030 goals are challenging unless the programme gathers momentum soon,” says Smit.
The report also aims to stimulate healthy debate by all stakeholders, and lead to a pragmatic solution as to how industry and government can best work together to fulfil the goals of SA Connect. It assesses how the private sector might contribute to achieving a world class broadband service, at reasonable prices, whilst nonetheless achieving a reasonable rate of return. The research considers types of service availability, areas of coverage, the identity of participants and providers, the amount of money being spent and still required to be spent on the provision of broadband, and who is taking responsibility for execution of the national goals.
BMI-T’s research includes the analysis of over 30 000 public sector points of demand across South Africa, as well as the identification of both¬† ‘fibre-centric’ and a ‘wireless-centric’ views of the infrastructure needed to satisfy the demands of SA Connect. The supporting technical and financial model demonstrates just how ambitious the goals of SA Connect are and the level of funding needed to achieve them.
The model finds that we need to more than double the current national fibre optic footprint. The resultant demand for the deployment of fibre optic infrastructure is likely to be up to ten times that of the most successful long distance project yet undertaken in the country.
“Structural changes are needed in the supply of infrastructure to meet the demand of SA Connect,” observed Smit. Similarly, the supply of LTE infrastructure and the supporting ecosystem is also quantified, at almost 20 000 LTE base stations needed to meet the SA Connect coverage and speed targets.
BMI-T has found that while there is a wide range in the annual capital requirements depending on prioritisation and choices made. The demands are not unrealistic when contrasted against the current expenditure by the operators (around R20-billion per annum), but the peak funding requirement and the lengthy time to become EBITDA positive are significant and is probably far beyond that which the state with current funding models can afford.
“It is crucial that industry and government urgently meet to pragmatically thrash out new funding approaches to the massive investment needed,” Smit says. “Should we not have a realistic discussion around the funding and implementation plan, we fear for the success of SA Connect as a whole.”