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The SADC Communications Environment

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The SADC Communications Environment Strengthening of economic and trade related capacities and competences in SADC The SADC Communications Environment An Assessment of Communications Policies, Laws and Regulations in SADC Member States Presented to GIZ – Deutsche Gesellschaft für Internationale Zusammenarbeit GmbH Germany / Botswana October, 2013 Assessment of SADC Communications Policies, Laws & Regulations Your contact person within GFA Consulting Group GmbH is Christopher Smith Strengthening of economic and trade related capacities and competences in SADC The SADC Communications Environment: An Assessment of Communications Policies, Laws and Regulations in SADC Member States Short‐ term Report Prepared by: Charley Lewis & Luci Abrahams, LINK Centre, University of the Witwatersrand, Johannesburg http://link.wits.ac.za Address GFA Consulting Group GmbH Eulenkrugstraße 82 22359 Hamburg Germany Phone +49 (40) 6 03 06 – 352 FaxPrepared by:+49 LINK (40) Centre, 6 03University 06 – of119 the Witwatersrand 2 E‐mail christopher.smith@gfa‐group.de Assessment of SADC Communications Policies, Laws & Regulations 4.11 SOUTH AFRICA 4.11.1 TELECOMMUNICATIONS SERVICES Services Framework: South Africa’s 2005 Electronic Communications Act distinguishes between telecommunications licences in respect of: infrastructure (“electronic communications network service” (ECNS) licences, which are required in respect of “satellite systems... fixed systems (circuit‐ and packet‐switched)... mobile systems... fibre optic cables (undersea and land‐based)... electricity cable systems (to the extent used for electronic communications services)... [ and] other transmission systems, used for conveyance of electronic communications”), and in respect of services (“electronic communications service” (ECS) licences for “any service provided to the public, sections of the public, the State, or the subscribers to such service, which consists wholly or mainly of the conveyance by any means of electronic communications over an electronic communications network... [excluding] broadcasting services”981. The Act further distinguishes between individual and class licences in both of these two categories982. Spectrum licensing is dealt with separately983. The licensing regime in South Africa is a converged one (horizontal or unified or multi‐service), distinguishing only between infrastructure and services. As such, it goes well beyond the vertical framework as set out in W/120. 981RSA (2005) ‘Electronic Communications Act’, No 36 of 2005, Republic of South Africa, Pretoria, Section 1, available online at http://www.icasa.org.za/Manager/ClientFiles/Documents/EComsAct_2005_No_36.pdf. 982 RSA (2005) ‘Electronic Communications Act’, No 36 of 2005, Republic of South Africa, Pretoria, Chapter 3, available online at http://www.icasa.org.za/Manager/ClientFiles/Documents/EComsAct_2005_No_36.pdf. 983 RSA (2005) ‘Electronic Communications Act’, No 36 of 2005, Republic of South Africa, Pretoria, Chapter 5, available online at http://www.icasa.org.za/Manager/ClientFiles/Documents/EComsAct_2005_No_36.pdf. Prepared by: LINK Centre, University of the Witwatersrand 256 Assessment of SADC Communications Policies, Laws & Regulations FOCUS AREA 1: MARKET STRUCTURE Market Structure: BuddeComm lists South Africa’s telephony market as comprising two fixed‐line operators, the incumbent, Telkom, and second national operator, Neotel, along with four mobile operators, Vodacom, MTN, Cell C and 8ta (a subsidiary of Telkom, now rebranded as Telkom Mobile), along with “hundreds of alternative service providers are pushing into the market with converged services”984. Following the landmark 2008 Altech judgement, over 400 VANS and ISPs now have licences to build their own networks985, allowing them to offer a wide range of such services, including VoIP. Goldstuck pegs the ISP market in South Africa at 726 Internet Service Providers as at 2009, mostly corporate internal ISPs986. South Africa’s Internet Service Providers’ Association (ISPA) currently provides a full listing of its 166 members, ranging from 16 “large” members, through 30 “medium” members, down to 5 “honorary” members987. The most recent relatively comparative figures for telecomms market share date from 2013988. 984 BuddeComm (2012) ‘South Africa - Telecoms, Mobile, Broadband and Forecasts: Executive summary’, BuddeComm, Bucketty NSW, available online at http://www.budde.com.au/Research/South-Africa-Telecoms-Mobile-Broadband-and- Forecasts.html. The full report is available on a for sale basis. 985 Jones, C & Kayle, A (2009) ‘VANS flock for licences’, ITWeb, Johannesburg, 16 January 2009, available online at http://www.itweb.co.za/sections/quickprint/print.asp?StoryID=192858. 986 Goldstuck, A (2013) ‘Internet Access in South Africa 2012’, World Wide Worx, Johannesburg. 987 ISPA (2012) ‘List of Members’, Internet Service Providers' Association, Johannesburg, retrieved from http://ispa.org.za/membership/list-of-members/ on 2013-08-22. 988 The listed operators issue subscriber numbers on a quarterly basis, as indicated in the respective footnotes. Data for Cell C and Neotel is derived from press statements and news reports, as they are not required to issue formal annual reports, and is hence considerably less accurate. Prepared by: LINK Centre, University of the Witwatersrand 257 Assessment of SADC Communications Policies, Laws & Regulations South Africa: Fixed & Mobile Subscribers989 2013 Subscribers Market Share Telkom (fixed) 3 995 5,6% 000990 Neotel (fixed) 155 000991 0,2% Vodacom (mobile) 29 190 40,9% 000992 MTN (mobile) 24 950 35,0% 000993 Cell C (mobile) 11 500 16,1% 000994 Telkom Mobile / 8ta (mobile) 1 534 2,2% 989 It is worth noting that South Africa’s horizontal licensing framework and relatively advanced level of liberalisation - especially following the key Altech court judgement which resulted in the awarding of individual infrastructure (electronic communications network services) licences to over 400 companies, most of which were ISPs - comprises hundreds of companies with individual infrastructure and services licences. A number of these companies are beginning to offer VoIP and other telecommunications services, but their subscriber numbers appear currently still very low. 990 As at 31 March 2013. See: Telkom (2013) ‘Telkom SA SOC Limited Group Annual Results for the year ended 31 March 2013’, Telkom, Pretoria, p5, available online at https://secure1.telkom.co.za/apps_static/ir/pdf/financial/pdf/Annual_Telkom_2013.pdf. 991 As at 31 March 2013. See: Tubbs, B (2013) ‘Neotel hits profitability milestone’, ITWeb, Johannesburg, 29 May 2013, available online at http://www.itweb.co.za/index.php?option=com_content&view=article&id=64468. The figure for business “customers”, numbering 3 000 and included here, probably equates to a much larger number of business lines. 992 As at 31 March 2013. See: Vodacom (2013) ‘Vodacom Group Limited trading statement for the quarter ended 30 June 2013’, Press release, Vodacom, Johannesburg, 18 July 2013, available online at http://www.vodacom.co.za/cs/groups/public/documents/vodacom.co.za_portal_webassets/tradingst atementq12014_final.pdf. 993 As at 31 March 2013. See: MTN (2013) ‘Quarterly update for the period ended 31 March 2013’, MTN Group, Johannesburg, p4, available online at http://www.mtn.com/Investors/Financials/QuaterlyResults/MTN%20Quartely%20March%202013 %20Final.pdf. 994 Date unclear, probably early to mid 2013. See: Tarrant, H (2013) ‘Is Cell C taking market share?’, MoneyWeb, Johannesburg, 24 July 2013, available online at http://www.moneyweb.co.za/moneyweb-broadband/is-cell-c-taking-market-share. Prepared by: LINK Centre, University of the Witwatersrand 258 Assessment of SADC Communications Policies, Laws & Regulations 000995 Total 71 324 000 According to the ITU, the market in South Africa as at 2011 was broken down as follows: 4 127 000 fixed‐line subscribers996; 64 000 000 mobile subscribers997. This translates to a per capita market penetration rates in the telecommunications sector for South Africa as at 2011 of 8,2% for fixed‐line, 126,8% for mobile and 21,0% for the Internet (from 8,4%, 100,5% and 18,0% respectively in 2010)998. Goldstuck estimates 11 303 000 Internet subscriptions in South Africa as at the end of 2012, with growing proportions of broadband (6 543 000 – ie 58%) and cellular (2 900 000 – ie 26%) subscriptions999. Because of the plethora of smaller ISPs, market segmentation will only be provided in respect of the much more measurable broadband market. South Africa: Broadband Subscribers 20121000 Subscribers Market Share1001 995 As at 31 March 2013. See: Telkom (2013) ‘Telkom SA SOC Limited Group Annual Results for the year ended 31 March 2013’, Telkom, Pretoria, p5, available online at https://secure1.telkom.co.za/apps_static/ir/pdf/financial/pdf/Annual_Telkom_2013.pdf. 996 ITU (nd) ‘Fixed-telephone subscriptions’, International Telecommunication Union, Geneva, available online at http://www.itu.int/ITU- D/icteye/Reporting/ShowReportFrame.aspx?ReportName=/WTI/ MainTelephoneLinesPublic&ReportFormat=HTML4.0&RP_intYear=2011&RP_intLanguageID= 1&RP_bitLiveData=False. 997 ITU (nd) ‘Mobile-cellular telephone subscriptions’, International Telecommunication Union, Geneva, available online at http://www.itu.int/ITU- D/icteye/Reporting/ShowReportFrame.aspx?ReportName=/WTI/CellularSubscribersPublic&Repo rtFormat=HTML4.0&RP_intYear=2011&RP_intLanguageID=1&RP_bitLiveData=False 998 ITU (2012) ‘Measuring the Information Society 2012’, International Telecommunication Union, Geneva, available online at
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