Convergence Partners, the technology investment vehicle controlled by Dimension Data Africa chairman Andile Ngcaba, wants to work with partners to build a multibillion-rand national wholesale mobile broadband network using long-term evolution (LTE) technology.
TechCentral has learnt exclusively that Convergence Partners, which already has investments in a range of telecommunications infrastructure projects — including the Seacom subsea system and the FibreCo national backhaul network operator — wants to build the network to provide wholesale services to incumbent and emerging operators.
Convergence Partners CEO Brandon Doyle says the proposed investment is part of the company’s plans to build networks spanning a range of technologies. The company is also an investor in the Intelsat New Dawn satellite, which was launched last year.
However, Doyle cautions that it’s still early days in the process and a lot more clarity is still required from the Independent Communications Authority of SA (Icasa) about how it plans to divvy up spectrum in the highly coveted 800MHz and 2,6GHz bands.
The two bands are seen as ideal for building next-generation LTE networks. LTE will pave the way to fourth-generation systems capable of delivering much speedier wireless connections to consumers.
“What Icasa is trying to do makes sense at the 10 000ft view, but there still needs to be [greater clarity] of how the model will work,” Doyle says, adding that the company has decided to participate in the process with the view to submitting a bid and building a network that will cost billions of rand.
He says spectrum is a scarce resource and Icasa needs to flesh out its plans in much greater detail.
Convergence Partners, he adds, wants to provide wholesale network access to existing operators and to new operators that will emerge in the next few years, including in rural parts of the country that are currently poorly served by the incumbent players.
If the company is successful in a bid for access to spectrum — it is likely to bid for access to both bands but will consider all its options — then it will provide wholesale access only. Doyle says Convergence Partners has no intention of providing retail services to end users and so won’t compete directly with retail operators.
He adds that it’s also too early to say which other parties Convergence Partners will work with, but, in response to a question from TechCentral, he says companies such as Internet Solutions (IS) and Cell C are “natural alliance partners”.
Cell C and IS, which is owned by Dimension Data, are co-shareholders in FibreCo, which is building a national fibre-optic backhaul network that will be crucial in providing high-speed links into LTE base stations. He confirms that Convergence Partners is involved in an “engagement process” with IS.
IS MD Derek Wilcocks says he is not yet in a position to reveal which partners his company is working with, but confirms it is eyeing a partnership model when it comes to spectrum. He promises to reveal more in the “next few weeks”.
“We are still very interested in the licensing process,” Wilcocks says. “How we take part will depend on what the final invitation to apply looks like.”
He adds that Japan’s Nippon Telegraph and Telephone, which owns Dimension Data, is not playing an active role in the process. — Duncan McLeod, TechCentral
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