Broadband capacity more affordable: SA Treasury

Treasury says that broadband capacity has grown and become more affordable, which drives Internet adoption in SA

February 22, 2012
Broadband government

South Africa’s Treasury today (22 February 2012) said that broadband capacity has grown and become more affordable, reflected in the growth of internet users from 5.3 million in 2009 to 9.5 million in 2011.

Finance minister Pravin Gordhan today delivered his 2012 budget speech, saying that government “remains steadfast in addressing the challenges of creating jobs, reducing poverty, building infrastructure and expanding our economy.”

As part of the Treasury’s infrastructure budget document it states that while progress has been made in expanding access, South Africa is some way from achieving the goal of high-quality, affordable telecommunications accessible to all.

“Progress in this area, which is crucial for building a modern economy, requires additional investment and improved regulation,” the Treasury said.

“Recent investment has focused on upgrading broadband internet, and mobile and land-based telephone infrastructure. Increased competition has begun to lower costs to consumers.”

“Broadband costs have declined somewhat and mobile phone technology has increased accessibility. But South Africa still lags behind peer countries in the quality and cost of telecommunications, with the average price of broadband at US$39.09 per Mbps – significantly higher than the world average of US$9.64 per Mbps,” the Treasury said.

The Treasury added that the private sector is the major provider of telecommunications services. “Service providers have expanded their land-based and wireless networks, and increased international connections via submarine cables.”

According to the Treasury the public sector provides additional investment to accelerate access and service provision.

“State-owned Infraco has committed over R1 billion in capital investment to support the West Africa Cable System, increase service provision in rural areas, and ensure sufficient connectivity for projects such as the Square Kilometre Array,” the Treasury said.

The Treasury added that further interventions directed at local loop unbundling and regulation of interconnection tariffs will confer significant benefits to consumers and the economy.

“Targeted interventions to lower the cost of doing business in South Africa will include lowering port charges and broadband costs,” said the Treasury.

Tags: Broadband Infraco, Headline, Infraco, Pravin Gordhan

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