You operator, we backbone
WHILE MANY COMPANIES are scrambling to become potential telecoms operators under South Africa’s new legislation, there have until recently been few with the ability or deep enough pockets to lay the infrastructure to make it all happen. Suddenly – with four fibre projects already on the go – there’s now a danger of corporate SA putting too much fibre in the ground in metropolitan areas.
That’s where Dark Fibre Africa comes in. A joint venture between Community Investment Ventures (CIV; 70%) and VenFin (30%) it hopes to roll out a transmission network – mainly in SA’s metropolitan areas – that others can rent from it. And it’s got the pockets to do so. Dark Fibre plans to raise up to R2bn with the help of primary funders Absa Capital and VenFin.
Vodacom is already a client, but other potential clients could include MTN and Neotel. Infraco is another, with which it has already held discussions, as are the various metros looking to build their own networks. CIV director Richard Came says Telkom is also a potential client, particularly on routes where it hasn’t got around to laying cable or needs additional capacity.
Other emerging alternate operators, such as Internet Solutions, M-Web, Verizon Business and Vox Telecom, would be potential clients if they get the correct licences from regulator Icasa. The new pay-TV operators could also rent capacity from it.
Came says Dark Fibre isn’t an operator and therefore doesn’t see itself in competition with players such as Telkom. That’s why it’s been flying below the radar screen a little – it didn’t want to come to market in a threatening way. Rather, it wants to be seen as a complementary infrastructure entrant in a sector crying out for capacity.
Came likens Dark Fibre to a property company leasing a building to a bank. “That doesn’t mean we’re going into banking. It’s an economies of scale thing.”
Dark Fibre welcomes other infrastructure players, particularly those providing additional capacity over the long haul, Came says. Hence the importance of the undersea cable operators Seacom and Eassy, both having secured financing for their projects and which aim to be operating by 2009.
Dark Fibre has the advantage of fast fibre laying technology (see previous report “A cut above the rest”, 23 August) that, says CIV chairman Eugene Mokeyane, should give it the edge over the next two years. Sister company Muvoni Weltex currently has two Cleanfast trenching machines in SA, imported from France, and Came anticipates there will be an additional 16 in the fleet – costing R6m each – by second half 2008.
The first machine dug the 14km Sandton fibre leg for Neotel earlier this year and is now digging downtown, with Vodacom as a client. Came says it’s possible to lay four or five ducts in a single trench. Each of those contains seven pipes with 100 strands of fibre, with each fibre strand capable of carrying 150m simultaneous voice calls – or 105bn calls/pipe. “That’s how nonsensical it would be for others to lay their own fibre as well,” Came says. “The capacity is almost infinite.”
Came says operators have been at the mercy of Telkom for their transmission infrastructure for such a long time that when they were suddenly able to self-provide, there would have been a rush to do so. But the various providers will hopefully realise over the short term that there’s no need to own infrastructure. That’s a model that’s been developed in more mature markets.
Roughly 70% of the cost of laying fibre goes towards digging up roads and obtaining various municipal approvals. Its machines use radar technology to detect and avoid digging up pipes and once the cable’s been laid, the machine repairs the road surface. The alternative is digging by hand, which is much slower and more obtrusive.
One danger of multiple operators all laying separate cables is that councils could begin objecting to the disruption of one project after another.
Mokeyane says one councillor described it as a “tsunami of applications”. He says it would also be able to “blow” additional fibre into existing ducts, which are serviced by controlled access via highly secure manholes (necessary for a multi-operator environment).
CIV invests in companies aims at building telecoms infrastructure, mostly manufacturing and supplying components.
Finweek
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