Transcript Broadband Infraco

Presentation to Select
Committee on Labour
and
Public Enterprises
17 October 2012
Slide 1
Agenda
Broadband Infraco Mandate
Product and Services
Investment Programme
Expansion footprint
Stakeholder engagements
Challenges
Conclusion
Slide 2
Mandate
Broadband Infraco’s legislative mandate is set out in the
Broadband Infraco Act No. 33 of 2007 (the “Act”).
The main objectives as set out in the Act are to
expand the availability and affordability of access to
electronic communications;
 Including but not limited to underdeveloped and
under serviced areas;
 In support of projects of National Interests;
 In
accordance
with
the
Electronic
Communications Act and commensurate with
international best practice and pricing;
 Through
the
provision
of
electronic
communications network services and electronic
communications services.
Slide 3
2.2 Broadband Infraco proposition re-stated
Strengths
Unique Strengths
Regional connectivity
National connectivity

Exclusive servitude access:
Eskom & Transnet
Latent strengths

Shareholding

Maintenance teams in the field

Network Operating Centre
Relative Strengths

Very High service level records
(managed fibre)

Stable network functionality

Above-average Mean Time To
Respond standards.

Expanded national footprint: 110
Customer termination sites, 151
long distance sites and over 12
700km fibre optic

Solid Shareholder

WACS shareholding

Service provider to a Second
Network Operator
International connectivity Interlinking East & West
Coast international cables
Slide 4
3.2. Provincial Broadband Segmentation
Provinces with immense commercial
imperative
[to a lesser
extent]
Gauteng
Western
Cape
KwaZulu
Natal
Free State
Commercial
powerhouse
of
Southern Africa;
33, 9% of the
National Economy
and 10% of the
total GDP of the
African Continent;
high
infrastructure;
some
rural
underserviced
areas;
45/7%
traffic
Up to 16,8% traffic
origination;
second
most
important province
in
terms
of
economic activity;
some
underserviced
townships
10.8%
traffic
origination; high
infrastructure
in
urban areas with
gaps
in
rural
areas
4.7%
traffic
origination; a most
strategic province
by
virtue
of
centrality
and
strategic location
Broadband Infraco will pursue these
provinces
purely
commercially;
redundancy/diversity;
Higher
SLA’s;
Private sector will also target them; Wider
Pop Access
KZN footprint
Western Cape footprint
•
•
•
Free State footprint
Gauteng footprint
Neotel-Vodacom-MTN (and SANRAL) Fibre Co-Build initiative:
Johannesburg-Durban and Johannesburg-Bloemfontein are both
just over 90% complete and should be by early 2013..
Bloemfontein-Cape Town is more than 50% finished, and is
expected to be complete in mid 2013.
FibreCo build from Bloemfontein to Cape Town
Where large metropolitan municipalities are initiating own fibre
roll-outs (City of Johannesburg; City of Cape Town; City of
Tshwane; Ekurhuleni Metropolitan Municipality; eThekwini
Slide 5
3.3. Provincial Broadband Segmentation
Broadband Infraco Limpopo footprint
Provinces for case-based engagement
Eastern Cape
Mpumalanga
Limpopo
3.8% traffic origination;
high economic growth
hubs
6.2% traffic origination;
significant potential
4.1% traffic origination;
vibrant
broadband
policy deliverables
Broadband Infraco Mpumalanga footprint
These provinces represent great opportunity; and
will be pursued as a matter of first priority
(backhaul; metro access and last mile) partnerships
with the private and public sector.
The private sector has very low appetite for these
provinces because of the lower economic activities
Broadband Infraco Eastern Cape footprint
The roll out of broadband in these provinces needs
to be driven by a socio economic benefit
Slide 6
3.4 Provincial Broadband Segmentation
Provinces with Socio-Economic
imperative
North West
Northern Cape
5.9% traffic origination;
poor
infrastructure
spread.
2.1% traffic origination;
sparsely populated (less
than a million) with very
poor infrastructure;
Broadband Infraco Northern Cape footprint
These provinces do not represent a
viable commercial business case.
Purely universal access roll-out.
Shareholder or provincial/customer
funding required. Partnerships are an
imperative
With the low population densities as
well as the low GDP alternate
technologies that require spectrum
have to be explored
Broadband Infraco North West footprint
Slide 7
Investment programme
Capital expenditure roll out plan
Slide 9
Outcomes
BBI Investment Program (IP) fully adopted Strategic Infrastructure
Programme (SIP)
BBI directly contribute to the Presidential Infrastructure Coordinating
Commission:
Directly impacting SIP 15, 16 and 17
Supporting SIP 12,13 ,14 and 6
Directly benefiting from SIP 10
This IP, covering the period 2012/2013 to 2016/2017 brings together the
projects costing to R4 039
These is to ensure that BBI delivers on its mandate and government
outcomes
Expansion projects
BBI Investment Program fully adopted Strategic Infrastructure Programme
(SIP)
BBI directly contribute to the National Government Outcome 6, SIP 14,15
and 16 as highlighted in the next slide
This Investment Programme, covering the period 2012/2013 to 2016/2017
brings together the projects costing to R4 039
These is to ensure that BBI delivers on its mandate and government
outcomes
Eastern Cape Inland connectivity
Phase 1
Requirement:
Access network connecting 37 out of
38 municipalities with access to
broadband connectivity.
Enabler:
Deploy 487km fibre and wireless
backhaul to enable provincial
connectivity.
Benefit:
Expand access to areas that are not
addressed by the market and the
likelihood of market investment is very
low due to poor economic activity
97% coverage in the province.
Estimated Cost:
R244.2mmillion.
Slide 12
2nd Northern Ring
Programme:
LP and MP
Requirement:
Access network connecting 19 of the
25 municipalities with access to
broadband connectivity.
Enabler:
Deploy backhaul connectivity of
554km redundancy and Network
expansion, connecting Limpopo and
Mpumalanga.
Benefit:
Alternative route to Zimbabwe
(international gateway); Botswana .
76% coverage in the province
SIP 17: Enable regional integration
Estimated Cost:
R401.4 million
Slide 13
Access Network Connection
Phase 1 covering
(GP, WC,FS and KZN)
Requirements
73km of access network to reach
the
sites
of
the
operators/customers or last mile
licence holders.
Create 16 open access points as
Telkom and Neotel’s PoP have
restrictions in Gauteng.
115km of access
Western Cape
network
in
An Operator neutral like Terraco
do not have sufficient footprint to
terminate operators
Outcome
Open Access in the Gauteng will
increase to 16
Additional 29 Open Access and
coverage of 58% in KZN
89% coverage in Free State and
Connecting 17 municipalities in
the Free State
Estimated Cost:
R833.8 million
Slide 14
Northern Cape Connection Phase 1
Requirements
Access network as there is no
national backhaul.
This is to address access
network, connecting 21 of the 27
municipalities.
Enabler:
need to deploy 894km of national
backhaul
Estimated Cost:
R364.3 million
Slide 15
North West Connection
Phase 1
Requirements
Base coverage in 17
municipalities
Enabler:
Need to deploy 691 km
Estimated Cost:
R125.2 million
Slide 16
Technology Life cycle management (Replacement or
Upgrade)
Adlash replacement projects
Single Point of Failure
Microwave replacement project
625 Critical faulty network
Transmission equipment enhancement project
Battery replacement project
IP Core
Customer requests
Slide 17
Investment Programme
Project Name
Province
Eastern Cape Inland connectivity
EC
244 166
2nd Northern Ring : Phase1
LP and MP
220 202
Access Network Connection covering
GP, WC ,
KZN & FS
Northern Cape Connection*
NC
North West Connection
NW
Total expansion
2013/2014
2014/2015
2015/2016
2016/2017
2017/2018
244 166
181 217
426 556
401 419
285 091
122 154
364 344
464 368
607 773
285 091
364 344
Total capital expenditure
833 801
364 344
125 177
125 177
247 331
1 968 907
Customer expansion
Total replacement/Upgrade
Total
741 000
All provinces
440 516
173 924
200 985
197 988
315 368
1 328 781
904 884
781 697
486 076
562 332
562 699
4 038 688
3169 km’s of Adlash replacement program
Year
Down Time Hr
Number of severe defects
KM
Amount
2013
1 206
53
1028
164 400
2014
231
43
744
119 053
2015
26
23
750
119 931
2016
186
44
648
103 677
1 649
163
3 170
507 061
Slide 19
Stakeholder engagements
Slide 20
Stakeholders
Enablers: Current
Eskom: Expansion programme
Transnet: Expansion programme
Enablers: Future
Sanral
Prasa
Possible partnerships
Telecommunication operators
Incumbents across the boarder
Investors
Commercial institutions
Developmental institutions
Universal Services Fund
Shareholders
Suppliers
Eskom
Transnet
Transmission equipment
manufacturers and suppliers
Slide 21
Conclusion
Slide 22
Connect. Growth, UNLOCKED.