Sentech Presentation to the Portfolio Committee on Communications

Sentech Presentation to the Portfolio Committee on Communications 2 November 2004

Sentech team • • Dr Sebiletso Mokone-Matabane Gladwin Marumo AK Mohamed Johan Raath Dingane Dube Matime Nchabaleng Thabo Komane Marc D’Oliveira

Sentech Highlights • Broadcasting • International Business • Multimedia

Spreading the footprint • Sentech’s broadcasting signal distribution network remains a valuable national asset • Very high service levels • 5 new television transmitters (SABC 1 & 2) – – – Cala Tolwe Straalhoek Hectorspruit Sterkspruit 4 April 03 16 May 03 25 May 03 26 March 04 • Sentech installs transmitters on customer request.

Regional Broadcasting • Sentech ready to support regional television

Towards digitisation • Test television transmissions in Johannesburg successful • Test radio transmission in Pretoria successful • Plans ready (spectrum utilisation) • Multiple sources for decoders (set-top-boxes) achieved. • Local manufacture of set top boxes – UEC already locally manufactured – Korean manufacturer ready to start a factory here. • South Africa will pay the best possible prices for the units.

International business objectives achieved • Carrying international traffic for the mobile operators – Low margin, high volume business • Developing business relationships in a number of African countries – Loveworld and Spirit Word African channels to over 500, 000 viewers – 94 TV Transmitters installed for Nigerian Television Authority • NEPAD – NEPAD channel operational – Trained broadcasting technicians and engineers from Botswana, Kenya, Lesotho, Namibia, Nigeria, Swaziland Tanzania • Taking active role in East African Submarine Cable initiative

Multimedia business objectives achieved • My Wireless launched in three regions • Connectivity partner for Gauteng On. Line • Increased teleradiology connectivity for Eastern Cape • First phase of My. Wireless completed – Deployment of a leading-edge technology – Ongoing system and network improvements

Multimedia milestones • Gauteng On. Line – Phase 1/2 1100 schools – Computer laboratory per school – Sentech is connectivity provider as well as longterm strategic partner – Sentech provides email addresses to each learner • Sentech committed to ensuring that every Province is able to bridge the digital divide

Multimedia milestones • Teleradiology successes still continuing • Sentech provides the connectivity between the radiologists in the Clinix hospital in Dobsonville and the following hospitals in the Eastern Cape – – Frontier SS Guido Cecile Makiwane Keiskamma • Patients Xrays diagnosed in real-time • Sentech ready to increase the coverage at the request of the Provincial DOH’s.

Multimedia Milestones • Sentech is the primary connectivity provider for Mindset – Carrying educational content to teachers and learners – Strategic relationship will continue as part of Sentech’s commitment to being the delivery partner for education • Sentech is the primary connectivity provider for Mindset for health – Sentech provides the delivery mechanisms for the health channel

Multimedia Milestones • Working with the USA to bridge the digital divide at schools and through community centres • Still providing the fastest Email in Gauteng to Siyabonga telecentre in Orange Farm

The year ahead • • Grow the Multimedia business Prepare the company for digitisation Enhance broadcasting Continue as the State’s delivery partner – Education, Health and e-Government

Sentech’s Integrated Platform Transport Applications Access VSAT Sentech Core Networks Content Streaming High Speed Internet Video / Audio & Enhanced Services TDMA / Docsis DVB Decoder / DAB Decoder TV & Radio Distribution DVB Platform DVB PCI Card Video Backhaul Multicast IP Vo. IP (voice) Gateway Video &IP Streaming Video & Audio streaming GSM & DVB-H / DAB Video & Audio streaming IP Decoder NSN Core High Speed Internet 3 G modem Application Services 3 G Mobile High Speed Internet Wi. FI Other Pt to M -Pt High Speed Internet & Vo. IP

Sentech and Convergence • Sentech welcomes the Ministers determination of 3 September 2004 – Some changes to Act required to turn restrictions into enablers. – VANS should not provide own facilities or provide switched voice (total deregulation) – Review Sentech licence conditions – Review position of PTN’s eg SITA • Sentech is the first fully converged communication company in South Africa • Sentech needs unrestricted voice. • Sentech will be seamlessly carrying and integrating voice, data, image and delivering solutions to South Africa

Job Creation and Poverty Alleviation • Sentech has fully restructured to embrace a converged future – Training – Re-skilling – Recruiting • Sentech is not retrenching to reskill – Building the skills of our people – Employment equity focus • Sentech School of Technology – Building Sentech skills – Building Africa’s skills

ISSET-SETA • • • Signed agreement with ISSET-SETA 48 learners to start January 2005 85% African/Coloured/Indian 60% Female 4% People with disabilities

My Wireless brings Real Empowerment Opportunities. • Network roll-out – – Site acquisition Site/network build BEE paramount Job creation

The Marketing Empowerment Opportunities • Sentech expects to directly sell about 20% of services • 80% will be through channel partners – Value Added Partners – Solution partners – Value Added Resellers • Major BEE opportunities – Already involved with BEE companies – Lasting and significant job creation in ICT – Grow the cake through empowerment

Cash Flows for the 2004 Financial Year • • Cash utilised in operation – Cash generated by operations – Net finance costs Cash utilised in investing activities – Assets acquired – Intangible asset acquired Cash generated from financing activities – Interest bearing borrowings – Non interest bearing borrowings Net cash movement -R 20 Mil R 34 Mil -R 54 Mil -R 148 Mil -R 94 Mil -R 50 Mil R 156 Mil R 106 Mil R 50 Mil -R 12 Mil

Financial highlights

Thank you