First published by Notes from the House

The Independent Communications Authority of South Africa (Icasa) believes the Minister of Finance’s recent plan for economic growth could hold the key to ending the ongoing stand-off between the regulator and the Department of Telecommunications and Postal Services (DTPS).

In his recent development plan, Finance Minister Malusi Gigaba singled out the licensing and provision of broadband data as a central tenet of South Africa’s development and growth strategy.

Icasa Councillor Rubben Mohlaloga said after a presentation on Tuesday to Parliament’s Select Committee on Communications and Public Enterprises that he places hope in Minister Gigaba’s demand that a policy directive be issued mandating Icasa to complete the licensing process for spectrum by December 2020.

This is a new turn in the long-running tension between the DTPS and Icasa after the latter issued an invitation last year calling on operators to apply for licences for spectrum in the coveted 700MHz, 800MHz and 2.6GHz bands. The idea was to extend mobile broadband wireless services, making it cheaper and more easily available.

The DPTS argued that the proposed auction would unfairly benefit the existing major players in the sector. It also said Icasa should have waited until the department’s White Paper had been published. The dispute ended in court with DPTS winning an interdict in September 2016, which effectively brought to a halt the rollout of spectrum.

Icasa’s report to the select committee made no reference to the ongoing legal dispute. Instead it focused on the benefits to be accrued to citizens if unused spectrum could be released.

In its presentation to the committee, the regulator emphasised that nationwide broadband access for all citizens is in line with the National Development Plan and repeated that preventing mobile operators’ access to the spectrum is crippling economic growth in South Africa, with the poorest as always feeling it the most.

Mohlaloga said Icasa wanted to see investment in broadband infrastructure and increased access to the 566MHz to 958MHz by 2020. This would encourage competition which can only be of benefit to consumers. “Increased broadcast platforms promote public diversity and help build social cohesion and a common national identity. Public interest will always be the driving force at the heart of it,” he said.

He confirmed that current penetration of smart mobile devices stands at 40%, with a growing trend. On average most people use about 800MB a month, also a figure that is certain to increase.

Icasa reported the results of its benchmark study comparing costs of data across the South African Development Community and found that, aside from Zimbabwe and possibly Angola, South Africa’s operators charge relatively more.

He said Icasa wants to co-operate with the Competition Commission inquiry mooted by Minister of Economic Development Ebrahim Patel during his budget vote into high costs of data in South Africa.

Keabetswe Modimoeng from Icasa reported that Icasa contributed a hefty sum to the national fiscus through the compulsory general licence fees that suppliers paid each year, determined as a percentage of its revenue. In the 2015-16 financial year these licence fees generated about R620-million.

Additional fees for the use of spectrum brought in another R464-million, he said. The latest figures incorporating 2017 were not yet released but he confirmed that all the providers complied.

They also pay an obligatory 0.2% of their annual turnover into a Universal Service and Access Fund (USAF), which is intended to subsidise poorer consumers and promote universal access to internet services in underprivileged areas.

Compulsory Universal Service Obligations (USOs) required mobile providers to roll out services to historically disadvantaged schools and special schools at discounted rates. Schools were selected in consultation with the Department of Basic Education. They had to have at least sufficient basic infrastructure to enable them to make use of this service.

By April 2017, 3,427 schools had been connected, he said. USOs for smaller providers like Sentech and Wireless Business Solutions (WBS) as well as Telkom were being finalised for the current financial year and the aim was to provide access to 5,000 schools by the end of 2019.

Select committee members appeared unappeased by these figures. They were more concerned to know why larger data bundles were cheaper than smaller ones, and why in-bundle rates were significantly lower in cost than out-of-bundle rates. After all, it is the poor who are more likely to procure the more expensive packages.

They also wanted answers as to why South African data was more expensive than most of our neighbouring states.

The committee cited examples of deep rural areas where non availability of access to internet could mean the difference between life or death when mobile phones cannot pick up a signal to call a doctor or ambulance.

Some Northern Cape schools have impressive computer technology that sits idle because there is no connectivity in their areas.

Another concern raised was the possibility of price collusion given that providers’ prices were so close, a matter that Icasa acknowledged as needing further investigation.

Committee chairperson Ellen Prins made a strong appeal for nationwide access, saying it is the poorest of the poor who are further disadvantaged by not having the internet to study, apply for jobs and develop social network contacts to promote opportunities for development.

She proposed a meeting of all stakeholders to thrash out these concerns, saying that she wants to give the providers an opportunity to give their side.

The Democratic Alliance’s Jacques Julius wanted to know how data that had been paid for can expire. He said this is the kind of question he is getting from his constituents.

“We need long-term, lasting solutions to this crisis,” he said. It is exacerbating under-development and “holding our people back”.

In other countries, citizens spend on average 5% of their income on data, but in South Africa the figure is more than 20%, he said. As always, it is the poorest who are hardest hit.

“We all know the benefits of [access to] data for people, especially in rural areas. If they are being held back or someone is holding them back this is a serious issue. Jeopardising cheaper connectivity is hampering the growth of our economy.” DM

Notes from the House is a new independent weekly digital newsletter that tracks and monitors Parliament in its role of holding government to account.

Photo: The extension of mobile broadband wireless services makes data cheaper and more easily available. Here, a resident of Soweto interacts on her cellphone. Photo: Kim Ludbrook/(EPA).