Forcing ISPs to have black owners will be disastrous – Expert

Hanno Labuschagne

Hanno Labuschagne

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You can't just "give" a shareholding of an existing company to someone for nothing. There are massive tax consequences involved if shares are not disposed of at market-related prices.
 
You will probably have a consortium that will end up buying into multiple ISP's. Quite a few guys with deep pockets out there.
 
Nereus77 said:
As the other thread mentioned, ISPs are a post-Apartheid thing. Its already transformed?

I'm waiting for the day white-owned businesses are outlawed.... BBBEE should be discontinued.
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You think that matters? If we were being "fair" BEE and EE should not affect any individual born after 17 March 1992.

What's an even bigger disgrace is how we always have to skirt around the real issue and find reasons to convince the ANC that what they want to do is a bad idea and will lead to the opposite of what they want to achieve. In any sane rational country this will simply be called out for what it is, illegal unconstitutional racist bs. Those should be enough reasons not to do it.
 
The anc doesn't give a shyte about good or bad all they care about is their pockets and retaining power.
 
This is the view of a prominent industry expert who spoke to MyBroadband on the condition of anonymity.
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Is said source related to any business or association who have made submissions, listed here?

www.ellipsis.co.za

Ownership and Control of Service Licences

[1 April 2021] The Regulations in respect of the Limitations of Control and Equity Ownership by Historically Disadvantaged Groups and the application of the ICT Sector Code have been published: Regulations in respect of the Limitations of Control and Equity Ownership by Historically...
www.ellipsis.co.za www.ellipsis.co.za

I read them all, so I have a gist as to where the industry is standing.

People who have read the other thread know how opposed I am. Here is the thing, the day this is promulagted it will also apply to entire sales and value chain due to the procurement model meaning that non-ISPs like agencies or virtual ISPs will also need to abide to be compliant with the chain. It is best to wait on what ICASA will be publishing which should be any day now.

I think this will be pushed through. A game-changer as Ramaphosa would put it.
 
You don't need an expert to state this,

The industry expert said imposing a particular shareholding on a company is always a disaster and it does not add value to the industry.

“There are not 600 black companies which can add value, but there are at least 600 licensees which are currently operating in the telecoms market,” he said.

This means the large ISPs will get the best black empowerment partners, while the rest will be lumbered with 30% “dead weight”.

Large service providers will therefore get a big competitive advantage over smaller companies, which is not what the regulations want to achieve.

This is particularly relevant in the infrastructure space where big players can raise billions through empowerment deals.

Smaller players do not have that luxury. They will have to take on black shareholders without much money and which cannot help to finance the business.
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SMME should have never been targeted by B-BBEE unless you are or want to be a supplier or provider within the Public Works arena then you engage within the B-BBEE criterion. As we know the state departed the notion that the public sector creates the most opportunity and have now placed the onus on the private sector.

The moment this pushes through, the other sectors and industries must brace. We are moving towards eliminating exempt-micro enterprises by empowering the procurement and supply channel where the top will be occupied by BIS ;)
 
It does not matter to the ANC whether it is a disaster or not.
Soon, they will have to replace blacks that seem to white because all the whites would have been replaced already.
If there will be any companies left.
 
quax said:
Can't people just start their own ISPs if they want to be in the industry?
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That's the thing.... There is no interest in building something from scratch - only handouts.
 
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