Source - Finance24
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Johannesburg - South Africans may be making their Christmas telephone calls this year on the lines of the second network operator (SNO).
Eskom Enterprise Division, a participant in the SNO, said the telecommunications consortium was in the process of approaching the industry regulator, the Independent Communications Authority of South Africa (Icasa), to issue a licence to start operating.
The SNO has been waiting on the sidelines for nearly three years to enter the multibillion-rand telecommunications industry in competition with Telkom.
Eskom Enterprise Division managing director Brian Dames said they will be approaching Icasa before the end of the month to issue the SNO consortium with a licence to enable them to start operating following countless delays.
Dames said the SNO partners have almost completed the finalisation of the shareholders' agreements and the business plan and once these were ratified they will approach Icasa.
"Eskom Enterprise Division has invested R800m in the SNO. Despite the delays that have been characteristic of the process, we are confident to recoup the losses," said Dames.
Eskom Enterprises Division is a wholly owned subsidiary of Eskom Holdings and is responsible for searching for opportunities and developing co-operation agreements and joint ventures inside and outside of SA.
The delays in setting up the SNO have cost SA millions of rands - African ICT research house, BMI-TechKnowledge (BMI-T) projected as far back as a year ago that the country may have lost R900m due to the persistent delays in setting up the SNO.
The SNO is expected to spend billions of rands over the next few years as it rolls out its infrastructure.
Shareholders in the SNO include Eskom's Esitel and Transnet's Transtel, who each own 15%, and black empowerment partner Nexus Connexion, which owns 19%.
The strategic equity partners, which include India's Tata Group, through its telecommunications subsidiary Videsh Sanchar Nigam Ltd, owns 26%.
CommuniTel (whose shareholders are MKMVA, Telecom Namibia, Gateway Communications and Premier Contracts Agency) and Two Consortium, majority-owned by Scandinavian operator Swedtel, own 12.5% each.
Telkom, the only fixed-line phone utility, was in 1997 given five more years of monopoly status to allow it to prepare for competition and roll out 2.8 million new lines, especially in rural areas.
When the monopoly status ended in 2002, it paved the way for competition which was expected to be licensed immediately.
However, the process of licensing a competitor was delayed by the slow formulation of telecommunication regulations.
Further compounding delays was the disqualification by Minister of Communications Ivy Matsepe-Casaburri of the applications of foreign strategic bidders, CommuniTel and Two Consortium, citing undesirable standards.
Following behind-the-scenes negotiations and threats of court action, a compromise was reached to award each of the two companies, CommuniTel and Two Consortium 12.5% equity.
Dames was confident the SNO would be ready for operation by the end of the year or, at the very latest, early in the new year.
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Johannesburg - South Africans may be making their Christmas telephone calls this year on the lines of the second network operator (SNO).
Eskom Enterprise Division, a participant in the SNO, said the telecommunications consortium was in the process of approaching the industry regulator, the Independent Communications Authority of South Africa (Icasa), to issue a licence to start operating.
The SNO has been waiting on the sidelines for nearly three years to enter the multibillion-rand telecommunications industry in competition with Telkom.
Eskom Enterprise Division managing director Brian Dames said they will be approaching Icasa before the end of the month to issue the SNO consortium with a licence to enable them to start operating following countless delays.
Dames said the SNO partners have almost completed the finalisation of the shareholders' agreements and the business plan and once these were ratified they will approach Icasa.
"Eskom Enterprise Division has invested R800m in the SNO. Despite the delays that have been characteristic of the process, we are confident to recoup the losses," said Dames.
Eskom Enterprises Division is a wholly owned subsidiary of Eskom Holdings and is responsible for searching for opportunities and developing co-operation agreements and joint ventures inside and outside of SA.
The delays in setting up the SNO have cost SA millions of rands - African ICT research house, BMI-TechKnowledge (BMI-T) projected as far back as a year ago that the country may have lost R900m due to the persistent delays in setting up the SNO.
The SNO is expected to spend billions of rands over the next few years as it rolls out its infrastructure.
Shareholders in the SNO include Eskom's Esitel and Transnet's Transtel, who each own 15%, and black empowerment partner Nexus Connexion, which owns 19%.
The strategic equity partners, which include India's Tata Group, through its telecommunications subsidiary Videsh Sanchar Nigam Ltd, owns 26%.
CommuniTel (whose shareholders are MKMVA, Telecom Namibia, Gateway Communications and Premier Contracts Agency) and Two Consortium, majority-owned by Scandinavian operator Swedtel, own 12.5% each.
Telkom, the only fixed-line phone utility, was in 1997 given five more years of monopoly status to allow it to prepare for competition and roll out 2.8 million new lines, especially in rural areas.
When the monopoly status ended in 2002, it paved the way for competition which was expected to be licensed immediately.
However, the process of licensing a competitor was delayed by the slow formulation of telecommunication regulations.
Further compounding delays was the disqualification by Minister of Communications Ivy Matsepe-Casaburri of the applications of foreign strategic bidders, CommuniTel and Two Consortium, citing undesirable standards.
Following behind-the-scenes negotiations and threats of court action, a compromise was reached to award each of the two companies, CommuniTel and Two Consortium 12.5% equity.
Dames was confident the SNO would be ready for operation by the end of the year or, at the very latest, early in the new year.
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