“South Africa’s Broadband Policy – Too many Delays, Now for Progress Together”

Yunus Carrim

Minister of Communications

Southern Africa Telecommunication Networks and Applications Conference (SATNAC) Conference

CONFERENCE ON BROADBAND - A CATALYST FOR SUSTAINABLE ECONOMIC DEVELOPMENT AND PROMOTING DIGITAL INCLUSION

Stellenbosch

2 September 2013

Congratulations on Centres of Excellence Programme and SATNAC Annual Conferences

Let me, in the first instance, thank you inviting me to this Conference and say I am very pleased to be here. And let me immediately congratulate Telkom on its Centres of Excellence (CoE) programme of which this annual SATNAC conference is a part. This Conference, I am told, is the only conference of its kind in the world that brings together industry leaders, academia and post-graduate students. The range and quality of speakers you have at the Conference is certainly impressive. 

The CoE programme and this Annual Conference are an important opportunity for and source of encouragement to young people in the ICT sector, and on behalf of government I express appreciation to all the industry players who not only fund the programme, but play an active role in its implementation. 

Consistent with your Conference theme, I will speak on Broadband and have titled the topic of my input today, “South Africa’s Broadband Policy – Too many Delays, Now for Progress Together”.

National Broadband Plans Matter

The past twenty years has been an extraordinary time for the development of ICT and specifically for the mobile communications industry. The mobile revolution has brought many benefits of the modern ICT industry to billions of people.

The next crucial step is to replicate the mobile miracle for broadband in South Africa. Most of our population still have no access to the Internet at all, let alone a broadband connection.

Broadband is not just about high-speed Internet connectivity and accessing more data faster. Broadband is a set of transformative technologies which is fundamentally changing the way we live – and which has a crucial to play in sustainable economic and social growth. 

Of course, the Internet has changed the way people live, work, learn and play. The Broadband Commission for Digital Migration report on “Why National Broadband Plans Matter”, done in cooperation with the International Telecommunication Union, and Cisco makes it clear that countries benefit significantly from a Broadband Plan and reinforces the need for us to finalise our Broadband policy in South Africa urgently. 

Research done by the Commission shows that countries with a National Broadband Plan have fixed broadband penetration 8.7% higher and mobile broadband penetration 7.4% higher on average than countries without plans. The report reveals that competition also plays a crucial role in improving broadband penetration. Competitive markets are linked to broadband penetration levels that are 1.4% higher on average for fixed broadband and up to 26.5% higher on average for mobile broadband. By mid-2013, the report reveals, there were 134 national broadband plans worldwide. According to the report, mobile broadband subscriptions in Sri Lanka cost as little $US3 for 3 GB in early 2012. Now just think of that! Compared to in our country….

As government we are also interested in how a Broadband Plan would improve the access of citizens to affordable services. We last week hosted an inter-departmental workshop on the ICT Policy Review that is aimed at producing a National Integrated ICT Policy Green Paper soon. One of the key issues that emerged from the workshop is the relationship between effective delivery of services such as education and health, for example, and the provision of broadband. 

The economic and social benefits of broadband are more likely to be realised when there is strong collaboration between government and industry. The question obviously arises as to whether or not the industry has kept prices artificially too high, rather than lowering them to enable greater access by more South Africans, which in turn will benefit the whole economy and ultimately the mobile operators too? Surely when cellphone penetration in our country is greater than 100% more citizens should be able to access the internet? Shouldn’t the industry do more ensure that we achieve the targets set by the Broadband Commission?

As you know, a sustainable future can be created through the proliferation of ICT and broadband. Good examples would include smart grids, environmental sensors, intelligent transport systems, dematerialization and the digitalization of goods and services, and new ways of improving energy efficiency, all of which helps to foster the transition to a low carbon economy and ensure more effective climate adaption.

Global Broadband Targets

The Broadband Commission for Digital Development has set a number of targets for 2015 aimed at making broadband policy universal, reducing costs and increasing access.

This includes the target that all countries should have a national broadband plan which should include definitions for universal access or service, and more affordable broadband with entry-level broadband services made available in developing countries through adequate regulation and market forces. The cost should be less than 5 percent of average monthly income. In 49 countries, mainly in the developed world, broadband access in 2010 cost less than 2% of average income.

Another target is that 40 percent of households in developing countries should have Internet access. Internet access at home is the most inclusive way of bringing people online. 

A third set of targets is that Internet-user penetration should reach 60 percent worldwide, 50 percent in developing countries and 15 percent in Least Developed Countries. This then gives you a sense of where we have to be if we are to be a globally competitive nation. 

So what is the state of our broadband policy?

State of Broadband Policy and Plan in SA

We went to parliament on 20 August and set out our strategy and programme until the 2014 elections. Our aim, we explained, is to finalise the Broadband Policy by the end of November.

The latest draft of the Broadband Policy, Strategy and Plan will be finalised by the Department of Communications (DoC) within 14 days and taken to other relevant Ministers for their consideration over the next month or so, including through SIP (Strategic Integrated Project) 15 of the National Infrastructure Plan, which is overseen by the Presidential Coordinating Commission. We are very clear! We need to ensure access to cheaper, faster, better quality broadband. It is long overdue. 

Obviously, we have to move with speed too on spectrum policy. We aim to finalise the Spectrum Policy by March 2014. This includes the issue of high-demand spectrum for broadband, which is linked to digital migration. 

Objectives of Broadband Policy

The objectives of the Broadband Policy include ensuring universal service and access to reliable, affordable and secure broadband services by all citizens prioritising rural and under-serviced areas; expediting the deployment of broadband networks and services in the country; ensuring the continued availability and expansion of broadband capacity to support economic and social goals of the country; reducing the cost of broadband services and customer premise equipments; and clarifying the roles of the Government, state owned companies (SOCs) and the private sector.

Broadband is, of course, being delivered across local and provincial government to differing degrees and in an uncoordinated way. Partly this is because of the policy vacuum on broadband. There is a need to ensure effective coordination in the construction of broadband networks in the country. Uncoordinated efforts often lead to duplication of resources by various entities resulting in them deploying infrastructure in the same place. The adoption of SIPs provides opportunities to piggy back on the rollout of other utility networks, such as roads, water, sanitation, rail and electricity, in the rollout of broadband networks. We are exploring the possibility that that ducts be installed in all major publicly funded utility infrastructures, at construction phase, to facilitate the extension of existing networks and the rollout of planned broadband networks. This is a matter being considered as part of our Broadband Policy and Plan.

We are going to consult with the local and provincial spheres to ensure coordination across the spheres within the framework of the Broadband Policy, Strategy and Plan. We will do this through the Cooperative Governance and Traditional Affairs MINMEC (Ministers and MECs forum) and by meeting with the South African Local Government Association. 

Broadband distribution is skewed towards metropolitan areas. Our Plan aims to ensure broadband infrastructure is fairly delivered also to rural and underserviced areas. 

We also recognise that Telkom has over 140 000 kms of fibre optic network in the country, which, it is said, is over half what the country needs for universal access. So we have to, in ways consistent with the recognition that Telkom is a listed company, see what Telkom’s role should be in the roll-out of Broadband. What too of the role of Broadband Infraco? We need to engage about this – openly and fairly. 

Promoting Digital Inclusion

Broadband will contribute to economic and social development by encouraging the adoption of local digital content. This will lead to the development of a National Digitisation Programme which prioritises amongst others, e-health, e-education and e-government services to citizens. In education, broadband has the ability to strengthen teaching, learning and administrative processes, transcending many geographical and financial limitations. The days of carrying a heavy school bag could become a thing of the past as school children merely carry their tablets to class. The Gauteng Government has already embarked on one such project. Gauteng's 2 200 public schools will have access to uncapped wi-fi and 3G connectivity and 88 000 Huawei tablets from next year, as part of the province's e-Learning Solution. 

In the health sector broadband will create more online access to quality health services, improve health data capturing and use as well as the dissemination of such data. Imagine if every patient at a public hospital had just one patient card that could be picked up at any hospital. 

Of course many government services are already available online. However, access to them is limited to those who can afford it. The rollout of broadband will ensure that more citizens have access to these services and will also act to stimulate government to make more of our services available online. Government departments and agencies could also serve as anchor tenants for broadband centres, making them financially viable while delivering their services.

A 10 percent increase in broadband penetration could lead up to a 1, 4 percent increase in GDP. Broadband can revitalise the e-commerce sector and provide for the creation of new industries and jobs. The booming app market and shift to online stores are examples of this. 

Government Can’t Do It Alone

For all the challenges, government has made significant progress since 1994. We could have done better. But we have certainly made important progress. The “2012 Development Indicators Report”, just released, shows that more South African households are accessing basic services, infant and child mortality rates are falling, and life expectancy has increased. Households with access to potable water increased from about 60% in 1994 to 96% by 2011/12, those with access to electricity increased from about 50% to 76.5%, and access to sanitation rose from 50% to 83.4%. Formal housing has grown by 50% since 1994, translating to an additional 5.6-million formal homes since the country's first democratic elections. Of course, there are questions about the quality of this quantity – but still there is significant delivery. South Africans' real incomes have also risen, with the percentage of South Africans in the poorest living standards measures group (LSM1 to 3) having fallen from 40% in 2000/01 to about 12% in 2011, while those in LSM4 to 7 (the middle class) having increased from 42% to about 60%. 

Why can’t the ICT industry report similar figures for broadband? Why is the ICT industry lagging behind? 

The increase in number of households with access to basic services like electricity, water and sanitation is the outcome of government’s deliberate actions to make these services available to people, especially to people without the economic means. Without this sort of determination, broadband penetration and usage will not improve. We can’t obviously leave it to the market alone. We need far more cooperation and importantly an acknowledgement of the importance of broadband roll out and expansion as a national imperative. 

The question of cost is clearly important. The reason why there is predatory pricing that has been left to block expansion and usage needs to be addressed more actively. Why the regulatory scheme failed to produce a significant lowering of price to communicate is an issue that this Conference also needs to consider further. Why is it that for same access, South Africans are charged higher by South African companies that behave differently in other markets? We thought charity begins at home but in telecoms it seems it begins elsewhere!

We need further considered engagement on this. ICASA is addressing this matter. As a department, without undermining ICASA’s work, we are hoping to have a pricing of telecommunications workshop with the participation of the operators before the end of this month.

Moving faster towards a new broadband world together

The International Telecommunication Union’s “Trends in Telecommunication Reform 2013” indicates that the use of multiple connected devices is increasing in both the developed and the developing world. The digital divide is now between those who have access to multiple screens, specifically broadband-enabled devices such as smartphones, laptops and tablets, and those who are limited to just one screen. Those having multiple devices connected to the Internet are full citizens of a hyper-connected world.

We are in the very early stages of a journey towards an extraordinary new world - a broadband world. We would like all of you to take an active part in this journey. Our job as government is to create the space for you to do so. And we certainly will.

We wish you well with your deliberations over the next few