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‘Spy Machine’ cost raises eyebrows

Information and communication technology (ICT) experts have questioned the higher cost of upgrading the Consolidated ICT Regulatory Management System (Cirms), widely known as the ‘spy machine’, compared to the buying price.

Malawi Communications Regulatory Authority (Macra) bought the system from Agilis International Inc of United States of America in 2010 at $6 142 608 (about K2.8 billion) to improve regulatory monitoring functions in four key areas of quality of service, revenue assurance, fraud management and spectrum allocation and management.

Macra’s Silika explaining how the machine works
Macra’s Silika explaining how the machine works

However, the machine could not be put to use since its purchase as Macra faced resistance, including court battles, with operators and some concerned citizens on the one hand.

The Malawi Supreme Court of Appeal last September ruled that Macra can start using it, throwing out an application by two concerned citizens—Hophmally Makande and Eric Sabwera—who had argued that through the machine, Macra would be listening to people’s conversations and accessing the short message service (SMS), thereby infringing on people’s right to privacy.

But the Supreme Court held that the Communications Act gives Macra the powers to monitor activities of its licensees to fulfil its statutory obligations, including consumer protection.

In the wake of the court ruling, Macra re-engaged the supplier, Agilis International Inc, who recommended the upgrading of the Cirms’ hardware and software due to technical advancement. The supplier revised the contract price from $6 142 608 to $13 871 969 (about K6.2 billion), meaning that Macra will have to pay an extra $7 729 361 (about K3.4 billion), according to a report Macra presented to Minister of Information, Tourism and Culture Kondwani Nankhumwa during their meeting in Lilongwe on February 25 2015.

However, an ICT expert has questioned how the cost of the system could be less than that of upgrading. The expert has since appealed to Macra to come out openly on the issue.

The expert, who is familiar with software and hardware upgrades, said: “For Macra to claim that the upgrading is actually more expensive than the cost of the software raises more questions to me.”

The expert said from the Internet research he carried out, Malawi has the most expensive system in all sub-Saharan Africa countries.

Another ICT expert, Dereck Lakudzala, a senior ICT consultant with Bumas  International, wondered whether the system is the right size for Malawi’s  economy.

He said: “It is most likely designed for large economies with very large telecommunications and ICT sectors. In those economies, the values [of the systems] might constitute a very small fraction of what can be saved using the systems.

“It is, therefore, not easy to justify that cost in a developing economy like Malawi.”

Lakudzala also asked whether, with rapid changes in technology which would require upgrading systems, Malawi will continue paying such large sums of money every few years.

He said: “On the surface, the figure mentioned is colossal and without answers to the above questions, it suggests a compromise in procurement prudence if buying decisions are made on the basis of only what has been made public. This is a definite red flag in prudent TCO [total cost of ownership].”

But Macra deputy director general Francis Bisika defended the investment, describing it as satisfactory and relevant.

Said Bisika: “Yes, we are comfortable with the upgrading price because other suppliers were more expensive than that. When the system was being purchased, subscribers were two million, but now [there are] about 5 million.”

He also admitted that the software is the most expensive in the sub-Saharan Africa, but defended it on the basis that it does multipurpose work.

But the ICT expert dismissed Bisika’s claims saying the cheaper software in other countries also performs all the functions that he has mentioned.

Nankhumwa said on Thursday the decision to start using Cirms is expected to generate $3 million (about K1.35 billion) in annual revenue.

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