The planned merger of state-owned Sentech and Broadband Infraco to create a State Digital Infrastructure Company has been pushed back to the 2028/2029 financial year, marking over a decade of delays. The move aims to improve ICT infrastructure efficiency but faces ongoing challenges with both entities.
The long-awaited consolidation of South Africa ’s state-owned signal distributor, Sentech , and Broadband Infraco ( BBI ), the national fibre wholesaler, has been further delayed, now pushed to the 2028/2029 financial year.
This represents a significant postponement, exceeding a decade since the initial proposal to create a unified state-owned digital infrastructure company. The updated timeline is detailed within the Department of Communications & Digital Technologies’ annual performance plan (APP) for 2026/2027, presented to parliament on March 31st. The document emphasizes that the development and progression of a roadmap for rationalizing BBI and Sentech are crucial for enhancing the efficiency and sustainability of the nation’s ICT infrastructure.
The focus for 2026/2027 will be on advancing this roadmap towards implementation, aiming to reduce resource duplication, improve operational efficiencies, and optimize infrastructure delivery. The situation surrounding Broadband Infraco is particularly precarious. BBI, established in 2007 with the goal of providing affordable long-distance bandwidth to underserved areas and challenging Telkom’s dominance in the sector, has operated for years without substantial financial support from the national treasury.
Gift Zowa, BBI’s CEO, recently acknowledged to parliament that the company’s continued existence without such investment is remarkable. The planned merger with Sentech, initially approved by cabinet in December 2017, has stalled, becoming a cycle of preliminary reports, roadmaps, and strategic assessments. The original intent – to create a powerful state-owned digital infrastructure entity by eliminating redundancy – has not materialized.
The current plan, as outlined in the department’s APP, involves completing another preliminary report in 2026/2027, followed by a finalized roadmap in 2027/2028, with actual implementation not expected to begin until 2028/2029. This marks at least the third revision of projected timelines since the initial approval. Previous ministers have also set and missed deadlines; Stella Ndabeni-Abrahams, for example, announced the merger on December 19, 2019, aiming for consolidation to avoid duplicated state infrastructure development.
By December 2022, Khumbudzo Ntshavheni projected the new company would be established by April 2023. The department’s performance plan reveals a pattern of shifting goals; the 2025/2026 target was to finalize a roadmap document exploring rationalization options, but a year later, the department is restarting with a preliminary report. Sentech, while not experiencing the same level of financial distress as BBI, also faces significant challenges.
The signal distribution company is struggling to maintain relevance in the evolving media landscape, particularly with the rise of streaming services and direct-to-home satellite television. Its terrestrial broadcasting infrastructure is becoming increasingly outdated.
Furthermore, Sentech is embroiled in a dispute with the South African Broadcasting Corporation (SABC) regarding what the SABC alleges are monopolistic pricing practices. The SABC currently owes Sentech over R1 billion for signal distribution services. The repeated delays and shifting timelines surrounding the merger raise concerns about the government’s ability to effectively manage and modernize its digital infrastructure. The lack of progress also hinders the potential for increased competition and reduced costs in the ICT sector.
The situation highlights the complexities of merging state-owned entities, particularly those with differing financial situations and operational challenges. The ultimate goal of creating a robust and efficient state-owned digital infrastructure company remains elusive, and the continued delays raise questions about the long-term viability of both Sentech and BBI in their current forms. The current Minister of Communications, Solly Malatsi, will be tasked with navigating these challenges and delivering on the revised timeline
Sentech Broadband Infraco BBI SDIC State Digital Infrastructure Company South Africa ICT Merger Digital Infrastructure Department Of Communications
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