Under the legislative framework applicable in this country (and for that matter most of the technical standards internationally) there is a layering of connectivity and a functional separation between the network operations and the services that run on those networks. A distinction between the traditional seven layer OSI model and the less defined four layer IP layer approach is the feature of prescription over description. The OSI model was designed by telecos and suffers as a result, the IP model was put together by academics (and hippies …) who embraced a particular spirit and ethos – well but not absolutely captured by Postel’s Law. Both approaches work however on the realization that layering and specialization of functions allows for a dynamic environment and in the case of the Internet a “conurcopia of networks” built by a community of individuals motivated by different things: Why have only one company fail to monetize the services on a network when many companies can share the fixed capital cost of the capital for a network and allow market forces and competition to weed out players? Why exclude voluntarism and have all decisions taken to suit one person’s perception of needs? Ideas such as settlement free peering (which is relevant to the CTR debacle, and will be returned to in a bit), open access and dark fibre are all primarily commercially driven. Dark Fibre Africa is an example of the sort of operator company that is envisaged by the Act – as opposed to Broadband Infraco – and that is a whole additional story …. Now there has been considerable talk of the value of an open access LTE network and so forth, but it always is couched in an idea of government (and ultimately the taxpayer) funding the ride which service providers will get to generate revenue on. Some of the more uninformed of consumer voices are demanding that network operators effectively subsidise expansion without there being any return on investment – this is mostly true with respect to the copper infrastructure owned and maintained by Telkom but has certainly got applications to the cellular operators (particularly in rural areas).
The point is not that we should impose a rigid separation of operators from service providers or that persistent regulatory measures are the solution to a problem – if anything regulatory measures: both historic and those taken as part of a “deregulation” agenda (and lest there is confusion, deregulation almost invariably occurs to the unjust enrichment of certain players with a social cost being carried – deregulation policies tend to be judged on a utilitarian standard of whether the benefits [growth] to society outweighed the costs to certain members, sadly such an approach doesn’t consider the injustice of any member of that society – usually the poor or disenfranchised –carrying a cost for which they are not compensated). The point is that the operators have an obligation to as operators interconnect on a non-discriminatory basis. The operators have an obligation to share facilities [in part to avoid duplication of encroachments on people’s lives and property] to interconnect, to comply with international standards and good practices… If the operators are unable to as operators adhere to these obligations – which they agree to when they apply for (and are granted) a license – then there is a serious non-fulfilment and questions need to be asked.
The question that arises is why the regulatory authority allows the dominant operators to act with such impunity. The current regulatory framework provides ultimately for a hamstringed regulator liable to find itself into a position of regulatory capture. The regulator has no real control over its budget, operates in a toxic political environment, and manifestly is responsible for things which should not be regulated. There is a certain sentiment to simply abolish the regulator which is countered by sentiments to “strengthen it” or to provide the regulator with more teeth. The problem is that both sentiments conflate and confuse ideological underpinnings and ultimately fail to stand up on either a principled or pragmatic standard. The problem is that if the regulator does the right thing, but somebody doesn’t like it they can expect litigation. On the other hand the regulator failing to do the right thing is tolerated, and so we have the spectrum process being tied up and a general calamity in the industry. The next few days will inevitably see some or another development on call termination rates – and it would be horrible if that development is the start of another urgent suit, but ultimately CellC’s management have a responsibility to their debt and shareholders to seek to preserve the status quo.
Further core obligations that make the ecosystem work are paired together in the licensing structure with various other regulatory and political red tape (BBBEE policies, obscure universal service obligations) and a series of taxes that are subjected to monumental waste – there is a massive kitty sitting with the US% awaiting further misappropriation. Rather than viewing building a competitive ecosystem that adheres to a spirit of collaboration and commercial common sense facilities sharing the BAUT perform all sorts of acts as part of the circus that is “the cost of doing business”. This transformation into being a participant in a circus represents the height of regulatory capture. Of course the problem of regulatory capture in the communications sector is by no means unique to the telecommunications operators and is more deadly in the broadcasting sector – Naspers have managed to migrate from their Afrikaaner nationalist roots of government influence into being an outright Murdoch-esque player (and there are many comparisons to draw).
