- Microsoft will want to be a player rather than just a big spender in South Africa’s black empowerment policy, the company has said following the announcement it would spend about half a billion rands (about US$ 64 million) in the next seven years to boost local business partnerships.
The company has also said rather than just get into partnerships with already big players on the market or swallowing the emerging minnows, it would put aside a big chunk of the spending plan for small local companies involved in software development across the country.
According to Microsoft’s plan, investing in the small players will be a way of empowering them, without having to swallow them into the bigger picture of the market.
The company’s SA’s equity manager, Kethan Parbhoo, has reported that Microsoft will put aside R472 million to fund small black-owned software development companies for the next seven years, adding that the company does not want any of the financing back, and will not be taking a stake in the start-ups, that will be funded through a system of competitive proposals for funding.
He further explained that Microsoft wants to “create a new model of entrepreneurship and develop a new economy for software”.
According to Microsoft, small black-owned companies should be able to grow beyond their small shaded operations and earn the competitive edge in the market if they are truly empowered.
The South African law requires that big corporations and industrial players issue a certain quota of their equity to previously disadvantaged groups of the country, mainly black.
However, the programme known as the BEE or black economic empowerment, has been largely criticised as a failure and only creating superficial few millionaires, without the empowerment benefits trickling further into the masses.
The programme has also been largely criticised as the main encourager of new corruption schemes whereby black people are fronted by huge white or foreign owned companies to dominate the supply chain and tender market.
While the Microsoft empowerment plan has been hailed in some economic quarters as a spinner likely to attract replication support from both government and private players, others have scorned at it as one way of running away from the reality of involving blacks in its operations and rather adopting a donor style to appease government, lawmakers and small players seeking funding to float in the highly competitive software development market.
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