JOHANNESBURG BROADBAND NETWORK PROJECT JBF UPDATE

WHY IS COJ DOING THIS?

What does a municipality know about networks Get other services right before deploying technology Municipal broadband has proved to be a failure: Wireless Philadelphia This is going to be a waste of ratepayers money Isnt there already enough fibre being deployed

BROADBAND 2.0
Broadband Broadband 2 2.0 0 is a term first coined around 2005 2005, to describe the next step in broadband performance required by highend users such as online gamers, and to deliver triple play services. Characteristics of Broadband 2.0 Higher bandwidth, low contention ratio Symmetrical access and Quality of Service Highdefinition video speeds (20+ Mbps) Multiple sources of content, peertopeer Two worlds of broadband Wireless for personal broadband access Optical fibre for fixed Broadband 2.0 access Wireless will dominate broadband in Africa Broadband 2.0 requires FTTB/FTTH access, even in South Africa

Bandwidth economics

Bandwidth B d idth i is not t a fi finite it resource like lik oil il over time, ti total t t l bandwidth b d idth will ill grow, and d th the price i per bandwidth will fall Driven by applications and content, broadband access bandwidth continues to grow exponentially around the world Access bandwidth per customer needs to increase continually Retail competition will increasingly not be on the price of bandwidth, but on services delivered over that bandwidth

WHY OPTICAL FIBRE?

Almost infinite bandwidth 25.4 Tbps (160 x 160 Gbps wavelengths) demo 600 Gbps on a single wavelength in laboratory Commercial Terabit p per second cables High reliability and availability vs copper Highly scalable bandwidth using DWDM

RSA TELECOMMS LANDSCAPE

Bandwidth costs in RSA are amongst the highest in the world
ADSL more than ADSL: th nine i times ti as expensive i as the th cheapest h t country t surveyed d LEASED LINE (2Mbps): 31 times more expensive than the cheapest country surveyed

Empirical evidence shows that bandwidth usage decreases relative to its cost Modern applications increasingly require more capacity for richer user experience

RSA TELECOMMS LANDSCAPE

RSA TELECOMMS LANDSCAPE

RSA TELECOMMS LANDSCAPE

GLOBAL BROADBAND BENCHMARKS

Country South Korea Japan Sweden United States United Kingdom Czech Republic Brazil India China Mayotte WORLD Midrand, SA Jo'burg Jo burg, SA Cape Town, SA

Average 14,6 Mbps 7 9 Mbps 7,9 5,7 Mbps 3,9 Mbps 3,4 Mbps 1 4 8 Mbps 4,8 1,1 Mbps 879 kbps 825 kbps 43 kbps 1,7 Mbps 1,5 Mbps 1 1 Mbps 1,1 1,3 Mbps

Change/y > 13% 11% 6,2% -2,4% 6% 23% -4,6% -6,8% 6,2% 13% -

5 Mbps > 74% 60% 42% 24% 19% 30% 1,4% 0,7% 0,4% 19% 4,2% 1 3% 1,3% 0,8%

2Mbps 94% 90% 75% 57% 73% 76% 11% 4,9% 4,2% 53% 11% 8 0% 8,0% 13%

Source: Akamai State of the Internet Report p

ECONOMIC GROWTH AND ICT

SOCIAL DEVELOPMENT VS PROFITS

PROFIT DRIVERS Telecoms operators are profit driven businesses Technology and network rollout prioritized to high income areas Project investment needs a short term return to shareholders Servicing under developed areas have low priority and are branding exercises at best DEVELOPMENTAL DRIVERS Increased access to ICT services can uplift communities Educational benefits of the Internet for schools and libraries A Access to t bigger bi markets k t f for entrepreneurs t and dj job b seekers k Emergency communications at lower cost Easier access to governments e-services Generally cheaper cost of communications

SPATIAL FACTORS

SPATIAL FACTORS

PROJECT OBJECTIVES
Reducing the ICT costs of local government and improving service delivery To have a Smart Digital World Class City prepared for ICT needs beyond 2010; Stimulating Socio-Economic growth through: Short Sh t and dl long t term j job b creation ti Reduction of telecommunications input costs Enablement of a greater range of services and application delivery to businesses and citizens Improving the marketability of Johannesburg as a destination; Increasing and accelerating access and digital inclusion through the massification of affordable broadband

COMPETITIVE LANDSCAPE

What is the missing link in market WHY and WHERE ??? Understanding End-User and TELCO Operator space in Fixed Line Voice Fixed Line Broadband Mobile 2G Voice Mobile Data GPRS, EDGE, or 3G Wireless Local Loop International Voice based on calling cards Fiber based FTTH (Fibre To The Homes) services for corporate and business users How is the Broadband access positioned compared to Mobile Teledensity in market Opportunity Analysis Asking Questions What is it that existing players are not doing Is there an untapped market segment What is it that existing players can do What is it that existing players are not doing and they cant do How can we maximize the revenue potential

PROJECT OBJECTIVES

JBN APPLICATIONS
Connection of city entities for data and voice services Moes, regional offices, community centres etc Development of eGovernment applications & services F Free telecommunications t l i ti zones in i certain t i under-serviced d i d areas Sale of capacity to firms, universities & VANS providers Enablement of high bandwidth access to internet and VAN services for constituents through SMMEs & VANS

JBN APPLICATIONS
A t Automated t dM Meter t Reading R di

City Safety

Key Sector Developments

Digital Education
Cheaper / Free local Calls

Digital Economy

Health & Medical applications

JBN EXCLUSIONS

Cash Cow
Key driver: Sustainability

COJ is not a telecommunications provider

PROJECT PROGRESS
Milestone/ Deliverable
Issue RFI RFI Responses Due Develop Evaluation Criteria & Scoring Template

Due Date
26/02/07 30/03/07 12/04/07

Planned Pl d% Compl
100% 100% 100%

Actual A l % Compl
100% 100% 100%

S Status

Complete Complete Complete

BEC Scoring of Responses Submit Report to EAC Issue RFP Phase 1 Demo Networks TOR Issue RFP Phase 2 Complete RFP document RFP Responses Due including Demo Networks Preparation Develop Evaluation Criteria & Scoring Template BEC Scoring of Responses p to EAC Submit Report

16/05/07 31/08/07 03/12/07 14/12/07 31/03/08 31/03/08 02/10/08 19/12/08

100% 100% 100% 100% 100% 100% 100% 100%

100% 100% 100% 100% 100% 100% 100% 100%

Complete Complete Complete Complete Complete Complete Complete Complete p

PROJECT PROGRESS REPORT

Milestone/ Deliverable

Due Date

Planned % Compl

Actual % Compl

Status

Finalize BOT agreement Begin network audit Begin services & contractual review Finalize rollout plan COJ signoff rollout plan

12/2009 04/2009 05/2010 10/2009 11/2009

100% 100% 25% 100% 100%

100% 100% 30% 100% 100%

Completed Completed In Progress Completed Completed

Implementation may start

05/2010

0%

0%

Not Started

JBN FACT SHEET

Network Core speed Equipment in use Reliability Grade Coverage area Wimax Fibre ECNS License Implementer 1.2 Terrabits/second Ericsson, Juniper, Cisco 99.999% (five 9s) Carrier + 900km Yes Yes Yes Ericsson

CORE DESIGN

CORE DESIGN

Our design needed to cover all regions in COJ We designed the fibre ring around COJ and MOE offices Th Fibre The Fib ring i also l included i l d d under d serviced i d areas (USA) The fibre optic network calculated to 900km of coverage The network capacity was designed to last for the next 15 years as future proofing The network design allows for any access technology to be connected

Services
The City would be required to allocate certain telecommunications services to the JBN these may consist of: (i) VPN & N Network t kM Management t (ii) Internet (iii) International Wholesale Bandwidth (iv) (i ) e-Mail M il (v) Hosting (vi) Voice Solutions (vii) VOIP Voice over Internet Protocol (viii) Data and Voice Mobility Solutions (ix) Web Gateway Security (x) Network Redundancy Services

Services
The City currently procures these services through contractual arrangements with a number of telecommunications vendors and, primarily; Dimension Data A telecommunications services review or soft audit is currently being conducted to: Determine operational expenditure on telecommunications Determine contractual obligations Determine current levels of service Establish a service calendar Th The soft f audit di will ill d determine i when, h h how and d what h services i are allocated ll d to the h JBN All current contracts will be honoured, Service reallocation will happen after contract term New telecommunications service requirements will be established on the JBN from inception Service management will be the responsibility of OCIO and the various MOEs

LEGAL & SCM REQUIREMENTS

The JBNP project must comply with all applicable MFMA provisions: Namely Procurement: Preferred bidder must be selected via municipal supply chain management process inclusive of RFI & RFP processes and bidder must be confirmed by COJ Executive Adjudication Committee (EAC) Contractual: The MFMA prescribes that municipalities may only enter into contract that i impose fi financial i l obligations bli ti on th the municipality i i lit b beyond d th three years only l if th there h has been public participation, views of the National Treasury, Provincial Treasury and DPLG have been solicited and Municipal Council adopts the contract Offtake Agreement : COJ must follow the provisions of section 48 when effecting such an agreement Rights of Use: COJ must charge a market related fee for any commercial activities wherein a COJ asset is used All MFMA provisions have been complied with in regard to the JBNP

All SCM provisions have been complied with in regard to the JBNP

Q&A SESSION

THANK YOU ALL ON BEHALF OF