The cold, hard truth about broadband in SA

Let the DoC be clear, ICT in SA is flourishing because of the current policies in place in SA.

This quote from a recent press statement issued by the Department of Communications (DoC) should not only be cause for disbelief and anger, but also of grave concern.

It makes it clear that the DoC does not realise that it is the single largest cause for delay in the roll-out of cheaper, faster broadband in South Africa.

The DoC even hints at how its causing these delays in trying to disclaim its earlier outrageous statement:

However, the DoC understands that technology, environmental, industry and individual needs are a constantly changing factor in the ICT field and as such the DoC is continually revising and revisiting policies to introduce policies which create the enabling environment required by businesses.

Continually revising policies over the course of many months, with no tangible outputs produced in that time other than setting up more and more platforms for discussion, is precisely why the DoC has nothing to do with the successes in the ICT sector.

The DoC continues to welcome open and genuine engagements with all South Africans through the various platforms.

Here is some “open and genuine engagement” from a South African.

Let me be clear: ICT in SA is hobbled by the DoC’s inaction on critical issues. Any “flourishing” in the sector is certainly not due to any interventions from government.

In fact, individuals and companies have either fought with or worked around government to be able to build infrastructure, offer services, and adopt the latest technologies in South Africa.

For broadband and information and communication technology in general to flourish in South Africa, this needs to change.

Dina Pule
Minister of Communications, Dina Pule

1. Assign essential spectrum

What must be done? Firstly, the DoC needs to finalise its policy direction on spectrum assignments so that operators don’t have to re-farm the spectrum they already have to launch new technologies such as Long Term Evolution (LTE).

What has been done? Nothing.

In 2009 ICASA tried to get the ball rolling on allocating spectrum in the 2.6GHz and 3.5GHz bands which operators were after for WiMAX services.

This has been such slow going that the world has moved on and ICASA changed its proposal to license the 800MHz “digital dividend” spectrum along with the 2.6GHz band instead of the 3.5GHz band.

Minister of Communications Dina Pule has made many promises about when she would issue this policy direction, but the big deadline is coming up at the end of March 2013 as she told parliament it would be issued by the end of this financial year.

Siphiwe Nyanda
Siphiwe Nyanda

2. Get on with South Africa’s digital TV migration

What has been done? Millions of Rands poured into rolling out DVB-T standard; everything derailed to reconsider alternative standards; DVB-T2 eventually adopted; slow progress since.

While the lower frequency 800MHz band mentioned previously is sought-after for LTE and particularly well-suited to roll-outs in rural areas, it is tied to South Africa’s migration from analogue to digital terrestrial television (DTT).

The so-called “digital dividend” band is meant to be freed up when a country migrates from analogue to digital terrestrial television (DTT).

Unfortunately, under Siphiwe Nyanda in 2010 the DoC completely derailed South Africa’s DTT migration by revisiting the choice of digital broadcasting standard at the request of the Brazilian government.

His successor, the late Roy Padayachie, managed to right the ship somewhat in 2011, but progress since then has been slow.

The DoC recently told parliament that it is likely South Africa’s migration won’t be completed by June 2015, which is an internationally agreed-upon deadline.

This means that trying to license the 800MHz and 2.6GHz bands together may cause yet another delay in assigning frequency spectrum unless some hard decisions are made by ICASA and the DoC.

What must be done? Given that all hope of finishing South Africa’s digital migration any time soon is lost, ICASA needs to migrate everyone out of the 800MHz band so it can be used for broadband. For this to happen, Pule needs to issue a spectrum policy direction that lets the regulator do this.

Roy Padayachie
Roy Padayachie

3. Conflicts of interest

Which brings us to one of the more important points of feedback for the DoC: get out of telecoms!

What has been done? Government sets telecommunications policy that dictates to the regulator (ICASA), yet through Telkom, Sentech, and Broadband Infraco is also a competitor in the ICT space.

Last year (2012), the South African government (Telkom’s majority shareholder) blocked a deal between KT Corp and Telkom. This move was widely criticised as analysts and minority investors felt that Telkom needed the cash injection and could have used the expertise that the Korean telecommunications giant offered.

Pule also staged a major upset at Telkom last year when she suddenly reversed her proxy and showed up at the Telkom AGM and blocked the appointment of 4 directors.

Shortly after this, Telkom CEO Nombulelo “Pinky” Moholi resigned, followed by the head of Telkom Business Mobile, Deon Liebenberg.

Another point of conflict is the state-owned signal distributor, Sentech.

Its former MyWireless product and the precious 2.6GHz spectrum Sentech has been camping on stand as reminders that government shouldn’t try to offer commercial broadband services.

If government wants to use Sentech to be involved in a wholesale LTE network along with the private sector then so be it, just so long as they don’t get to keep the spectrum that has gone unused all these years. Otherwise it will continue to be squandered as it has been.

What must be done? Government needs to sell its stake in Telkom and give up on the notion that it has to be a player in South Africa’s broadband space to drive it forward. While the DoC is getting out of telecoms it should empower the Independent Communications Authority of South Africa (ICASA) to take away the spectrum Sentech has been sitting on all these years and give it to someone that will use it.

LTE Spectrum Assignment Plan
LTE Spectrum Assignment Plan

4. Make it easy to build networks

Exiting telecommunications as a direct player doesn’t mean there aren’t ways for government to be hands-on when it comes to infrastructure roll-outs.

What has been done? The DoC has worked pretty hard to inhibit infrastructure build in South Africa.

In 2007, then Minister of Communications Ivy Matsepe-Casaburri tried to block EASSy and Seacom from landing in SA. The landing of Seacom is widely seen as a major contributor to the decrease of bandwidth pricing in South Africa.

Later, in 2008, Matsepe-Casaburri got an urgent court interdict to prevent companies from “self-provisioning”, or building their own networks and providing their own telecoms services.

Altech fought against this and won. Their victory is also seen as a major milestone as it allowed greater competition in the South African market, which contributed to lower prices.

Last year (2012), Pule proposed in the draft Electronic Communications Act amendment bill that these hard-won rights should be taken away and government should once again be able to decide who may build networks in SA.

What must be done?

  • Government could be the one who puts in the piping and ducts for cables to run through, rather than roads being dug up every time someone wants to lay fibre.
  • Instead of trying to hinder companies building infrastructure, the DoC should be using its influence wherever it can to make it as easy as possible. For example: helping to streamline the processes to get the necessary approvals, permits, and licenses to lay cable or put up masts for cellular (and other wireless) antennas.
  • Incentivise infrastructure investment, in urban and rural areas. The DoC has a particular soft spot for rural roll-outs, and giving better incentives than well-serviced areas is a great way to encourage operators to go there. Urban incentives could help encourage fibre-to-the-home roll-outs. This may even have the happy side-effect of reducing prices.
Ivy Matsepe-Casaburri hugged by former Telkom chairperson Nomazizi Mshotshisa
Ivy Matsepe-Casaburri hugged by former Telkom chairperson Nomazizi Mshotshisa

Posturing versus progress

Since Pule took the reins, the DoC has launched a few new terrestrial TV transmitters, opened computer labs at schools, and held many a talk shop.

Sadly there has been very little in the way of actual, measurable progress coming from the DoC on the critical issues facing information and communications technology of South Africa.

Talk of increasing competition through spectrum assignment and local loop unbundling has been around at least as early as 2005 when the DoC held not one, but two colloquiums to find ways to drive down prices for telecoms services in South Africa.

The time for talk is over, and has been for a while.

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The cold, hard truth about broadband in SA