On 17 February, telecommunications & postal services minister Siyabonga Cwele held his second engagement with the information and communications technology sector on the national integrated ICT policy white paper.
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.
But 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 users’ experience and access to the latest technologies.
At the previous industry engagement, held in December 2016, Cwele stated that there would be no further consultation, that the details were a done deal, and that, going forward, only implementation 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 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:
- The proposal to implement a Woan;
- That access must be offered at cost-based pricing;
- 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 socioeconomic impact assessment has not been conducted, which means that costs and benefits have not been determined.
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 services.
South Africa’s Internet success story is one of few post-1994, with coverage, quality and access to mobile devices that outperform 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 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 socioeconomic 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.
Data prices are likely to rise, not fall.
- Leon Louw is executive director of the Free Market Foundation