There's a new director-general and a new minister at the helm of the Department of Communications, giving the underperforming ICT (information & communications technology) sector hope for a revival in 2011. However, this will require a serious policy overhaul, an integrated e-strategy and a visionary broadband strategy.
This is according to Alison Gillwald, executive director of Research ICT Africa, and also an Adjuct Professor at the UCT Graduate School of Business where she convenes the course "Connectivity & Convergence: Alternative Regulatory Strategies for Telecommunications", a programme designed to provide alternative regulatory strategies for resource constrained developing countries.
“A new ICT policy will require the identification of policy levers to improve the country’s sub optimal performance by identifying the necessary conditions for attracting critical investments in infrastructure extension, the optimal market structure and institutional arrangements, together with identifying demand stimulation strategies that are essential to ensuring digital inclusion.”
“This includes everything from short-term incentive strategies to promote the uptake of PCs and Internet-enhanced devices, to longer term educational and IT literacy programmes,” she says.
Gillwald says that, despite South Africa being an early adopter of most new technologies, its Internet penetration rate has been extraordinarily low and the country is no longer a continental leader in broadband access. A critical factor here, she believes, is the high cost of broadband and terrestrial leased facilities acquired from Telkom by ISP.
After years of there appearing to be no relief from the monopoly prices charged by Telkom on the SAT3 cable, international bandwidth costs are likely to fall with the landing of multiple undersea cables. With the landing of the Seacom cable in 2009 and EASSy last year, international bandwidth prices have started to tumble. With the forthcoming West African Cable (WACS) landing in South Africa in the next year or so, there will be a surfeit of affordable bandwidth.
‘’The challenge is now in the terrestrial backbone and the backhaul extension that will connect end-users, terrestrial backbones and undersea cables,” she says.
The unco-ordinated and conflicting network extension policies and strategies of the Departments of Communications responsible for sector policy and Department of Public Enterprise responsible for the state broadband company Infraco, together with the “anti-competitive behaviour associated with network dominance and legal and regulatory bottlenecks, still hamper their roll out.
“The country needs an integrated e-strategy. A visionary broadband strategy will need to underpin it,” she says. ”Multi-million dollar broadband strategies have become central to economic recovery and economic growth strategies around the world.”
According to Gillwald, high prices and low bandwidth are a hindrance to innovation. “Universities, R&D shops and business need affordable bandwidth to innovate."
She adds that the suboptimal performance of the sector, had costs for the national economy, both in terms of high input cost of communications into business, affecting the decision of business to locate regional officers and inhibit the case for job creating off-shore business process outsourcing and call centre development.
Learning from our African neighbours and other emergent markets can help address these challenges.
“In South Africa and many other emergent markets, policy makers and regulators have emulated the regulation employed in mature competitive economies with resourced regulators to address telecom and ICT reform challenges. This UCT GSB programme examines these regulatory practices to understand why they are seldom successfully implemented in developing country contexts and proposes less resource intensive alternative strategies,” she adds.