The proposed National Integrated ICT Policy White Paper could set South Africa’s ICT industry back significantly – and we might see legal challenges if government attempts to implement it as it stands.
The white paper was pushed through despite inadequate public participation and no Social Economic Impact Assessment (SEIA), according to the Free Market Foundation (FMF).
The FMF believes a successful local ICT industry is in danger of being uprooted and replaced with a rare, unproved and failed alternative.
According to the FMF, the National Integrated ICT Policy will make or break the industry in South Africa, with everyone in the country affected. The fact that it is not following international best practice means there are no proven models or success stories underpinning the policy.
Leon Louw, executive director of the FMF, explains that ICT is critically important to all citizens of South Africa. “ICT really is not just the future but the present. The Internet of Everything means that everything is data driven – so the use of the spectrum is the link.”
Within South Africa there are currently more active cell phones than people, which points to the pervasiveness of technology. “The world is data driven, so every country has to ensure that the ICT policy is not messed up. That’s the one thing we need to get right above all else,” Louw says.
“What we have here is a proposal to do with ICT what we inherited from the apartheid regime with Eskom – we are now going to replicate that with ICT.”
Ironically, the South Africa is already very successful when it comes to ICT, Louw adds. “We have great coverage and have rapidly rolled out technology: there is 2G almost everywhere and we are rolling out 3G, 4G and even 5G.”
However, further growth is limited because of a failure to allocate spectrum. “And we will not have that spectrum in the future unless it is auctioned – this is what has happened everywhere else in the world.”
The proposal to create a monopoly for wireless broadband access would be a very bad idea, he adds, and could lead to a slowing of technological advancement.
“The one thing you want to have is a policy that ensures you don’t fall behind, and this won’t happen with a state-run monopoly”
There are questions about whether the promulgation of the white paper would pass constitutional muster. “We are concerned about the formalities and constitutionality of the white paper,” Louw says. “There are opinions that the procedure was not constitutional.”
Issues raised by the FMF include the fact that every new policy must be preceded by a SEIA, and this did not happen.
“All policy must be reasonable and procedurally fair, and this did not happen,” Louw says.
“Public participation must form policy and respond to what was submitted. But there are elements in the white paper that were not subjected to public consultation.”
The approval of the policy also raises questions about the separation of powers, Louw adds.
Africa Analysis’ Dobek Pater points out that the proposed ICT National Integrated ICT Policy is aimed at realigning key policies with governments development goals and providing a platform for companies to further develop the sector to compete globally.
It aims to do this through a number of interventions:
* The creation of a single national wholesale network, using so called high demand spectrum, currently unassigned – 700MHz, 800MHz and 2 600Mhz; and to recover spectrum already allocated to various licence holders into one large spectrum pool for use by the national network.
* The creation of a more open access environment, with access to essential facilities, infrastructure sharing and wholesale/retail separation.
* Introduction of neutrality.
* Facilitate rapid infrastructure deployment through reduction or elimination of red tape.
* The creation of a separate regulatory authority for the broadcast market – essentially going back to the status quo before ICASA.
* The creation of a new entity to manage the universal access fund, taking it away from USAASA.
Pater points out that most of the elements contained in the integrated ICT policy white paper already exist in the ECA – but many of the caveats have never been implemented.
The policy would make provision of services using the LTE spectrum more accessible to smaller service provider who would not need large capex for infrastructure development but work on an opex model.
On the downside, large players would not be able to gain a further strategic advantage, based on an exclusive access to high demand spectrum.
Pater points out that implementation of the policy in its current forma may result in litigation by large operation, which could retard the use of high demand spectrum by years. It would therefore be important that the large i-ECNS licensees work with the government and ICASA in his respect to resolve development that is potentially very damaging to the market
The proposed policy, as it stands, raises some red flags, Pater says.
The role of government is worrying, he says. The proposed policy significantly expands the scope of oversight through the establishment of committees and the transfer of functions from statutory bodies to the Department of Telecommunications and Postal Services (DTPS) so all policy functions will go to DTPS. There would also be a range of new committees established and scope of their oversight will be significantly expanded.
The proposal calls for a wireless open access network that would offer broadband access using high demand spectrum which will all go to this operation. The could lead to the ultimate contraction of the number of ECNS licence holders, Pater says.
The spectrum policy would be an effective nationalisation spectrum, and taking high-demand spectrum from the current licence holders. Pater believes this could have significant negative impact on the existing licence holders, although it will free up spectrum for smaller players.
Of lesser concern in the proposed policy are the roles of DTPS versus the Department of Communication (DoC), the open access principle and the rapid deployment policy.
“We have an industry that works and works quite well,” Pater says. “If it’s not broken, the question is why we would want to turn it on its head. This could be disastrous, or it could be fine,.”
One of the big problems is the investment required to build the wireless open access network – it is a lot of money and government probably doesn’t have the money. So they would want the private sector to contribute.
There would be reluctance from the private sector from a risk perspective and lack of understanding how the network would be implemented and managed.
Unless you know you will have some influence over the money you send, companies will be reluctant to invest.
How will bandwidth be allocate on the network it is not an infinite resource if you want more, you have to invest more.
These concerns cast doubt on the viability of the proposed policy, Pater says.
“Certain aspects of the integrated ICT policy are questionable. There is also lack of clarity at this time around how various aspect will be implemented.”
Potential problems include:
* The single national wholesale open access network model – this is an unproved concept and may not succeed.
* Recovery of spectrum – this could have a major impact on the current spectrum holders.
* Setting up of a new broadcasting regulator – this could facilitate migration towards convergence or it could have the opposite effect.
* Net neutrality – what flavour of net neutrality is right for South Africa?
Pater believes there are other methods of achieving the same results as proposed by the new policy – but at a lower risk.
FMF raises ICT policy concerns
