In a public tender issued Thursday, 27 January 2011, Potraz said it wanted to install passive telecommunication infrastructure in designated rural areas in the country using the USF's connecting rural communities' project.
Potraz is therefore seeking bids from qualified civil and structural engineers to design and install the infrastructure on its behalf, the notice said.
Passive telecommunication infrastructure consists of towers and physical sites which can be shared by various telecommunication companies. Infrastructure sharing helps in reducing the cost of providing service by reducing the capital and operational costs.
The USF was established under the provisions of subsection (1) of Section 73 of the Postal and Telecommunications Act [Chapter 12:05]. Proceeds from the fund are derived largely from 2% of annual revenue levied on all licensed operators, although Potraz can boost the fund's coffers through any money appropriated by an act of Parliament for the purposes of the fund and surplus funds at the end of the regulators financial year.
Local telecommunication firms have been less aggressive in rolling out telecommunication services to rural areas due to high costs as well as lack of meaningful returns from such investments due to lower revenue per user averages in remote communities.
As a result, telecommunication infrastructure has been largely concentrated in urban areas.
The fact that local telecommunication firms have been reluctant to share infrastructure has also limited the extent to which such investment can be made by the companies in remote areas of the country.
The passive telecommunication infrastructure to be put up by Potraz under the USF will likely be the first arrangement under which the three mobile networks will share infrastructure in the country.
