Uncertainty mars tender for digital TV

A state entity is forging ahead with a R4.3bn tender for the manufacture of television set-top boxes without the government having finalised its policy on the devices. At least 5-million set-top boxes will be needed for South African households to allow their analogue television sets to receive digital signals. by Samuel Mungadze

The Universal Services and Access Agency of SA (Usaasa) issued the tender to comply with the International Telecommunications Union's rules that analogue broadcasting be replaced with digital worldwide by June.

Bidding for the lucrative tender closed on Tuesday, with 145 companies participating.

SA's migration has been severely delayed by a dispute over whether the set-top boxes should be encrypted.

The SABC and MultiChoice do not want encryption, while e.tv favours it.

E.tv has been accused of planning to use the boxes as a platform for pay-TV, allowing it to use a system subsidised by the state.

Usaasa said it had decided that companies should bid for both platforms, encrypted and non-encrypted, while waiting for the government's decision. It said Parliament was informed that, in the interests of saving time, it was best to call for bids for the manufacture of both encrypted and nonencrypted set-top boxes.

We are going with both until the Cabinet decides, Usaasa spokesman Khulekani Ntshangase said on Wednesday.

The Democratic Alliance has threatened legal action against Usaasa on the grounds that in the rushed attempt to meet the June deadline, proper processes and evaluations may be circumvented and sidelined, rendering the tender process unlawful.

Mr Ntshangase said the process had been transparent. There are checks and balances; there is a project manager and auditing firms monitoring the entire process, including the chief state procurement officer. We wanted to make sure we allay fears of misconduct.

The National Association of Manufacturers of Electronic Components (Namec), which has been advocating that 60% of the migration spending favour small businesses, said it was happy with the process so far.

The control system is not an issue any more. We are agreed, as stakeholders, that there will not be conditional access, said Namec president Keith Thabo.

Namec submitted its bid as Namec-Microtronics, shareholders of which include the Umkhonto weSizwe Military Veterans Association and Congress of Traditional Leaders of SA Capital.

Mr Thabo was adamant that most of the tender should be given to black firms and said his company was in pole position for a fat slice. We are the only black company with a plant to manufacture set-top boxes.

MultiChoice corporate affairs GM Jackie Rakitla said the company believed it would be inappropriate to comment on the tender process. But it had some reservations about the policies.

It is a matter of public record that we do not support the inclusion of set-top box control because we don't believe it is in the best interest of South Africans, as it is unnecessary, costly and serves no useful purpose, he said.

Platco Digital MD Maxwell Nonge, on behalf of e.tv, said: We are still waiting for the government to finalise digital migration policy, which will give the industry certainty. We don't have an opinion on the tender but what we know is that policy will supersede anything that's being done.

SA and many African countries have lagged behind the rest of the world on digital migration and are now racing against time.

We have to start spending on set-top boxes by March, Mr Ntshangase said.

The country has to roll out the boxes by June 17. If we don't do it we will contravene the terms of the International Telecoms Union, and that has serious implications for the country.

Last year, Ovum Research predicted that most sub-Saharan countries, notably Nigeria and SA, would not meet the deadline.

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