| Thu 17 Sep 2009, 13:44 | | ALT - Allied Technologies Limited - Altech and SEACOM announce strategic |
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ALT
ALT
ALT - Allied Technologies Limited - Altech and SEACOM announce strategic
bandwidth alliance
Allied Technologies Limited
Member of the Altron Group
Incorporated in the Republic of South Africa
Registration number: 1946/020415/07)
Share code: ALT
ISIN number: ZAE000015251
17 September 2009
Altech and SEACOM announce strategic bandwidth alliance
JSE listed Allied Technologies Limited (Altech) and SEACOM, today announced
their strategic alliance for the mutual acquisition of bandwidth capacity on
two cable systems. The agreement sees Altech procuring two STM-16s from SEACOM
(equivalent to 5Gbps), with the option to upgrade, within three years, to
double this capacity, to an STM-64. SEACOM will in turn purchase six STM-64s
throughout the East Africa region on the terrestrial backbone network owned by
Kenya Data Networks (KDN), a subsidiary of Altech.
"This strategic alliance with SEACOM, and Altech`s investment in the
construction of terrestrial networks needed to support SEACOM in bringing its
capacity inland, allows us to play a leading role in radically changing the
face of African connectivity. Altech has through the alliance secured the East
African region for the distribution of much needed bandwidth. We are delighted
to be partnering with SEACOM in this historic venture, pioneering the
unlocking of a region hungry for low-cost, high-speed broadband access. The
alliance is yet another element perfectly suited to Altech`s overall
convergence strategy," said Altech Chief Executive Officer, Craig Venter.
KDN is a `carrier-of-carriers` telecommunications operator with 6000kms of
fibre and radio infrastructure throughout East Africa. It is currently the
largest data network infrastructure player in the region, intent on extending
its reach throughout the African continent. This unique positioning makes it
ideal as a network to link the SEACOM submarine cable to land-locked countries
in East and Central Africa.
"The African market for international bandwidth is expected to swell to 800
Gbps, from today`s 10 Gbps, with a significant portion of this new demand
coming from East Africa. Today, Altech and SEACOM have taken a giant step
towards unlocking this enormous potential in East Africa. The success of
SEACOM would not be possible without infrastructure which links our beach
landing stations to metropolitan PoPs. KDN`s extensive inland infrastructure
in East Africa will link our landing station in Mombasa to Nairobi, on to
Kampala and Kigali," said Brian Herlihy, SEACOM Chief Executive Officer.
Venter added, "Africa currently only has 1% broadband penetration compared to
the US which has 60% penetration. Marrying KDN`s terrestrial fibre network
with an abundance of bandwidth capacity complements our aims of unshackling a
five country East African network. Kenya, Uganda, Rwanda and soon the DRC and
Tanzania are to become competitive on a truly global scale and Altech will be
instrumental in making this a reality."
Through KDN, Altech currently provides the majority of backhaul capacity for
the largest GSM operators in East Africa, namely Safaricom, Zain and Essar.
KDN`s interest in the TEAMS undersea cable and Altech`s SEACOM capacity
acquisition makes Altech one of the largest bandwidth suppliers in Africa.
"Bandwidth becomes significantly cheaper in bigger volumes, enabling Altech to
pass on more competitive prices to its customers than other providers.
Significant bandwidth customers have already been secured by Altech in the
East African region," said Venter.
SEACOM, the 1.28 terabits per second, 17 000km undersea fibre optic cable,
linking South and East African countries to their European and Asian
counterparts, was commercially launched at the end of July 2009. The cable is
the first of many undersea cables anticipated to be completed in the next
three years, facilitating low-cost bandwidth connectivity for East Africa. The
SEACOM cable is expected to trigger explosive growth in the region, as it
enables African operators to invest in further rollouts of both transmission
networks (e.g. national fibre) and access layer networks (e.g. WiMAX
deployments). An extensive network rollout program would be challenging under
a high-priced environment, where international bandwidth is provided solely
via high cost satellite solutions. Satellite is considered to be eight times
more expensive as compared to fibre. Insatiable demand is expected for the
lower cost bandwidth made possible by SEACOM and Altech, enabling peer-to-peer
networks and internet connectivity at markedly reduced prices and
significantly increased capacities.
"Rather than selling capacity directly to end-users, we will provide our
wholesale bandwidth to African retail carriers such as Altech, who buy a
portion of bandwidth and onward sell this capacity to end-users. These end-
users will in turn be able to access the internet at international broadband
speeds and at more affordable prices, creating a wealth of opportunities for
important sectors, such as education, healthcare and government services,"
said Herlihy.
The key to Altech`s overall converged services strategy, is the exploitation
of opportunities stemming from its recently acquired I-ECNS license. Altech
Technology Concepts, the second tier corporate internet service provider and
information technology company, requires better priced bulk bandwidth for its
expansion plans and specifically into gated communities and office parks
throughout South Africa. The SEACOM bandwidth provision agreement, will thus
not only increase the progress of Altech`s East African ambitions through KDN,
but also pave the way for synergistic opportunities throughout the various
businesses within the Altech Group. Notwithstanding the SEACOM investment, as
well as various other acquisitions, Altech states that it will still conclude
the year with a balance in excess of R500 million.
Johannesburg
Sponsor: Investec Bank Limited
Notes to Editors:
Altech:
Altech with turnover in excess of R9 billion, is listed on the Johannesburg
Stock Exchange (JSE) involved in the Telecommunications, Multi-media and
information Technology industries and employs over 5000 employees in South
Africa and abroad.
As a leading South African multi-billion rand high-technology group, Altech is
involved in the design, development and convergence of telecommunications,
multi-media systems and IT solutions. There is a strong focus on the
convergence of these technologies and Altech is now also entrenched in the
arena of secure technology solutions.
Altech has ongoing access to the latest technologies worldwide, while the
group`s own research and development programme actively encourages and
promotes internal technology.
SEACOM:
SEACOM, which is privately funded and over three quarter African owned, will
assist communication carriers in south and east Africa through the sale of
wholesale international capacity to global networks via India and Europe. The
undersea fibre optic cable system will provide African retail carriers with
equal and open access to inexpensive bandwidth, removing the international
infrastructure bottleneck and supporting east and southern African economic
growth.
SEACOM will be the first cable to provide broadband to countries in east
Africa which, at the moment, rely entirely on expensive satellite connections.
Within Africa, South Africa, Mozambique, Madagascar, Tanzania and Kenya are
inter-connected via a protected ring structure. Additionally, a second express
fibre pair is provided from South Africa to Kenya. These two fibre pairs have
a combined capacity of 1.28Tbs. Express fibre pairs are also provided from
Kenya to France into a PoP in Marseilles, and from Tanzania to India into the
PoP in Mumbai. SEACOM has procured fibre capacity from Marseilles to London as
part the SEACOM network.
SEACOM`s enormous capacity will enable high definition TV, peer to peer
networks, IPTV, and surging Internet demand. Pricing will be significantly
lower than current satellite or fibre pricing.
SEACOM will be ready to serve southern and east African markets from July
2009, well in time to meet the bandwidth needs of the 2010 Soccer World Cup in
South Africa, and the growing requirements of the economies in the countries
it will serve.
SEACOM is 76.25% African owned by:
- Industrial Promotion Services (26.56%), an arm of the Aga Khan Fund
for Economic Development
- Venfin Limited (25%)
- Convergence Partners (12.5%)
- Shanduka Group (12.5%)
The remaining 23.44% is held by Herakles Telecom LLC.
FOR FURTHER INFORMATION PLEASE CONTACT:
Craig Venter: Chief Executive Officer
TEL: (011) 715-9004
FAX: (011) 715-9045
CELL: 083 236 8000
EMAIL: cventer@altech.co.za
OR
Wessie van der Westhuizen: Chief Strategic Officer
TEL: (011) 715-9043
FAX: (011) 715-9047
CELL: 082 8001818
EMAIL: wvdwesthuizen@altech.co.za
OR
Joe Makhafola: Group Executive, Corporate Affairs, Marketing,
Government Liaison & Regulatory Affairs
TEL: (011) 715-9026
FAX: (011) 715-9047
CELL: 071 290 1735
EMAIL: jmakhafola@altech.co.za
www.altech.co.za
JSE code: ALT
Date: 17/09/2009 13:44:05 Produced by the JSE SENS Department.
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