Geraldine Fraser-Moleketi, Minister of Public Service and Administration, said in her announcement yesterday, "Neotel's ‘bandwidth on demand' translates to a cost of some 8.5 times less than the next closest offer. This demonstrates the importance of effective competition in the telecommunications marketplace, which in turn reduces the cost of doing business in South Africa." Moleketi adds that in utilising Neotel, SITA is ensuring that cheaper telecommunications for government becomes a reality. "The deal provides an important impetus for enhanced competition and growth of the domestic telecommunications market, and in turn the economy."

Neotel's Next Generation Transmission Network offers greater reliability and flexibility, likely factors in SITA's decision making process. SITA's customers, the various Government departments, are expected to find a tangible improvement in their network experience with Neotel's services. Neotel will provide nearly twice the bandwidth on SITA's network compared to the services procured by them in the past from Telkom.

The SITA Act mandates SITA to provide IT and related services to all Government departments, and SITA has historically used Telkom as its backbone telecommunications provider. However, in light of the availability of a true alternative provider of national infrastructure, SITA has elected to switch to Neotel. Neotel will typically provide optical fibre transmission links to the main SITA sites with either STM-1 or STM-4 interfaces. This contract is part of SITA's project to deploy the largest public sector NGN deployment in Sub-Saharan Africa, worth R454mn.

Ajay Pandey, Managing Director of Neotel, said "Neotel is proud to have won this prestigious order, and we look forward now to meeting and exceeding the expectations of SITA and their customers. We are happy that SITA, and therefore the Government, have acknowledged the role that Neotel is playing in South Africa's telecoms landscape. In the entire bidding process, we have tried to live up to our commitment of offering better value to the customer, by providing nearly twice the bandwidth connectivity while still ensuring that the customer stays within budget through an innovative product offering."

Neotel has recently responded to another SITA tender for access services, and will continue to seek to extend the relationship. Neotel views such key relationships between government and private industry as part of its commitment to making a real difference in South Africa.

About Neotel:
Neotel is the first national infrastructure-based competitor in the fixed line telecoms sector in South Africa. The company aims to reduce the cost of doing business by enhancing the operational efficiencies of companies through the optimal use of advanced communications technologies, and to extend these benefits into the second economy. Much has changed in the telecoms market in recent months, in South Africa as well as globally. Recognising the changing requirements of telecoms users in South Africa, Neotel is building itself to be a preferred provider of leading-edge telecommunications, well beyond the traditional concept of a fixed line operator. Its various telecom licences, including the PSTS Licence issued to Neotel as the second national operator of South Africa, allow the company to provide the entire range of telecoms services with the exception of full mobility.

About SITA:
The State Information Technology Agency (Pty) Ltd, was established in 1999 to consolidate and coordinate the South African government's information technology (IT) resources in order to achieve cost savings through scale, increased delivery capabilities and enhanced interoperability. To this end, SITA is committed to leveraging IT as a strategic resource for the state, managing IT procurement and delivery processes to ensure value creation and the effective delivery of e-government services to all citizens.