Data prices are likely to rise, not fall
On February 17, Department of Telecommunications and Postal Services (DTPS) Minister Cwele held his second engagement with the telecommunications industry known as the ICT or information and communications technology sector. He released a statement, afterwards, saying that the department had won widespread industry support for its Wholesale Open Access Network (WOAN) proposal and that emphasis had shifted from the proposals to implementation. The statement implied across the board consensus and backing for the introduction of a WOAN from the six mobile network operators and 300 plus industry representatives who had been in attendance.
The Minister’s disingenuousness does not reflect the truth. The industry is reeling from shock after discovering that the four-year process, from initial discussions to white paper, has resulted in a policy that would radically reorganise a successful private industry and damage mobile user experience and access to the latest technologies.
ICT (information and communications technology – or technologies) is an umbrella term that includes any communication device or application, encompassing: radio, television, cellular phones, computer and network hardware and software, satellite systems and so on. ICT provides the framework and infrastructure for every aspect of mobile technological communications in society including business, education, media, broadcasting, government and much more. It is the backbone of a modern economy.
At the previous industry engagement held in December 2016, Minister Cwele stated that there would be no further consultation, that the details were a done deal, and that, going forward, implementation only was on the table for discussion. In effect, “put up, shut up and get on with it”. But, it appears that the department has no implementation plan and is looking for proposals from the industry. For the big six mobile operators, this is like asking turkeys to plan Christmas.
Making consultation a high priority now, comes very late in the day. Between 20 March 2015 and 3 October 2016, three critical policies that had not been seen or discussed by the industry, were inserted into the White Paper and presented as a fait accompli. The three policies that have caused alarm and consternation are:
1. The proposal to implement a Wireless Open Access Network (WOAN);
2. That access must be offered at cost based pricing;
3. The taking back of spectrum already allocated to operators who have invested heavily in infrastructure.
These proposals are not only radical. Their introduction after the fact runs contrary to both the spirit and the requirements of the Constitution regarding public participation. In addition, a Cabinet-mandated Socio Economic Impact Assessment (SEIA) has not been conducted, which means that costs and benefits have not been assessed.
Industry insiders believe that this policy is headed for the courts, which would tie up the industry in many years of litigation. This is not good news for South African consumers of mobile Internet.
South Africa’s Internet success story is one of few post-1994 success stories with coverage, quality and access to mobile devices that outperforms many developing country peers. It does not need fixing.
The national integrated ICT Policy White Paper is bad policy. It
- places government in control of a critical economic sector,
- effectively nationalises a private industry,
- creates a government monopoly,
- proposes to expropriate private property,
- introduces a new fund raised from private companies to put into government hands,
- scraps existing independent regulator ICASA,
- introduces regulatory complexity and new government controlled institutional bodies,
- lacks clarity and essential detail,
- failed to consult properly on key proposals,
- lacks a mandated socio economic impact assessment,
- and opens the door to more corruption and patronage.
Despite the Minister’s assertions to the contrary, the WOAN model has not been proven to work anywhere in the world so far.