Tag Archive for 'policy'

Telecoms in South Africa: Apres moi, le deluge

Published
by
Steve Song
on 29 August 2008
in Telecom Policy
. 0 Comments

In a landmark decision today, the High Court of South Africa ruled that everyone in possession of a Value Added Network Service (VANS) license was entitled to “self-provide”.  What this means is that every Internet Service Provider (ISP) in South Africa is entitled to compete with the likes of Telkom, Vodacom, MTN, and Neotel.  In one fell swoop, the market has gone from 4 players to conceivably over 600 players.

At the root of this change has been the dispute around how existing VANS licenses should be converted in the context of the “new” Electronic Communications Act of 2005.  The Minister of Communications has argued that only some VANS licenses should be converted to full “infrastructure” licenses which would allow companies with VANS licenses to build out their own infrastructure.   In essence, this was an attempt by the Minister to perpetuate the “managed liberalisation” process that began almost 14 years ago.

That attempt appears to have backfired on the Department of Communications and their Minister.  The Minister could have issued a general invitation for companies to apply for an infrastructure license (i-ECNS license) and considered each application on its own merits.  Instead, by attempting to influence the license conversion process which is the purview of the regulator (ICASA), they provoked a court challenge from one of the companies in the conversion process (Altech).

The court decision, handed down this morning, utterly rejected the validity of the Minister’s attempt to influence ICASA’s handling of the conversion process and completed validated the Altech’s contention that VANS should be able to self-provision.

Since, the Act states that all licenses must be converted on terms no less favourable than their existing terms, this means that ICASA is bound to grant infrastructure licenses to all 600 VANS licensees.  Great news for telecoms competition in South Africa!

Unfortunately this is just a battle won but not the war.  There are many other issues to be addressed.  For a start, the fees associated with the telecom infrastructure licenses.  Given that only a short time ago Neotel paid R100 million Rand for their license, I can see some drama brewing on what sort of annual fees should be charged to the newly converted licensees.  The ideal scenario in my opinion would be to have fees tied to revenue and only have the fees kick in after a certain threshold of revenue had been reached.  This would contribute to lowering the bar to market entry.

Another and perhaps more significant issue to be addressed is the allocation of spectrum.  There are lots of lessons learned from around the world.  Why can’t spectrum be auctioned in South Africa in a transparent and open manner.  Lack of transparency must surely be one of the biggest barriers to investment.

However, one battle at a time.  You can see the general expressions of joy from the South African community.    Arthur Goldstuck’s Oh Frabjous Day is worth reading as is the general outpouring of joy by likes of Dominic Cull and Ant Brooks (and a few hundred others) on the mybroadband.co.za discussion list.

Ellipsis have posted a copy of the judgement.  Can’t wait to see how the DoC and the Minister react.

Open Everything in Government

Published
by
Steve Song
on 26 August 2008
in All Things Open
. 2 Comments

I attended the Open Everything (Cape Town) event on Friday.  Apart from being a masterfully facilitated workshop and an excellent opportunity to talk to other “openly” minded folk, it also featured a great interview with Aslam Jaffee, CIO of the Department of Science and Technology in the Government of South Africa and the current chairperson of the GITOC Open Source and Open Standards working group of the Government IT Officers Council (GITOC).  Matthew Buckland and I interviewed Aslam on his experience of establishing an Open Source, Open Standards, Open Content policy for the South African government.  Mark Surman has blogged about it and has posted a podcast of the interview that you can listen to.

Does Open Source Need To Be Government Policy?

I was somewhat skeptical of the idea of enshrining Open Source as a mandated policy in government.  It seemed a bit like mandating the eating of spinach.  You know it’s good for you but there is a natural resistance to implement something you’ve been ‘ordered’ to implement especially if it means a change from the status quo.  It also seemed to me that good policy follows practice and not so much the other way round.

Having said that I was impressed by Aslam’s presentation and it may be that in the case of South Africa at least, that having an Open Source/Standards/Content policy is a good thing.  The policy states that the government will use Open Source unless there is a compelling reason not to.  This obviously provides a lot of leeway as it is conceivable to write a software specification to suit almost any particular piece of software.  However, it does ensure that at the very least a dialogue needs to take place in each case as to the merits of Open Source.  This alone is a very positive step.

It is interesting that Open Source, Open Standards, and Open Content have been bundled together in the policy.  I am in two minds as to the wisdom of having all of those issues in a single policy document.  On the one hand, I can see how, given the opportunity, one might want to pack as much openness into a policy as possible.  On the other, they are each complex issues in their own right and deserve treatment on their own merits.  In particular, I think Open Standards deserves to be the absolute, non-negotiable backbone of procurement policy whereas I think the dialogue-driven tone they have struck with Open Source is probably about right.  Open Content is a different kettle of fish again and appears to be directly at odds, at least in spirit, with the Intellectual Property legislation currently being tabled in parliament.

Flavours of Openness

What does Open Source in government really mean?  Aslam mentioned at least three broad categories.  Open at the server, open at the desktop, and open at the application level.   He pointed out that the South African government has been using Open Source software for its mail and web servers for many years.  Further, there is work underway by a couple of departments (the CSIR and the Department of Science and Technology) to roll-out Ubuntu on user desktops.  However, in the area of large scale corporate applications not much has happened yet.

While I think there are compelling reasons to deploy Open Source desktops and mail and web servers, I think the real opportunity for Open Source in Government lies at the application level.  Governments around the world face similar challenges at the national, provincial, and local levels.  As the trend towards e-services grows within government, one cannot help but wonder how much duplication is taking place around the world in the development of applications to deliver services, whether government-to-citizen, government-to-business, or government to government.

The Frontier for Open Source in Government

Many initiatives claim to be Open Source but fail in significant ways.  The Brazilian government’s Department of Health is a great example of this.  They have developed a comprehensive health information management system which is theoretically Open Source but only available through governments i.e. the Brazilian government may privately offer the software to the South African government.  This strategy may give the Brazilian government a comforting sense of control but it substantially reduces the chances that any other government will ever implement this software.  Perhaps this is not a tragedy from a Brazilian perspective but think of all the lost opportunities for Ministries of Health around the world.  What this strategy misses out on are the many health information system developers around the world who could potentially contribute to this project.

Consider by comparison, an initiative such as OpenMRS.  OpenMRS is a community-developed, open-source, enterprise electronic medical record system framework.  Thanks to its modular design and a robust, open API, OpenMRS lends itself to flexible extension into a variety of more specific applications.  Government support for flexible core applications like OpenMRS could transform the way that applications are developed to support government services.

A powerful step any government could take would be to get behind independent, transparent, community-driven Open Source initiatives like OpenMRS to support the development of common, open applications for effectively delivery of government services.

Operators Response to SA Government’s Proposed Rapid Deployment Guidelines

Published
by
Steve Song
on 24 April 2008
in Telecom Policy
. 0 Comments

On the 27th of February 2008, the Department of Communications published a notice inviting comments on Proposed Guidelines For Rapid Deployment of Electronic Communications Facilities in Terms of the Electronic Communications ACT, 2005 (ACT NO. 36 of 2005). Among other things the guidelines propose the mandatory minimum 51% “African or South African” (is it just me who feels jarred by that phrase?) ownership of all submarine cables landing in South Africa (SAT3 excepted).

In a heretofore unprecedented move, Telkom, Vodacom, MTN, Neotel, and Cell-C have made a joint submission in response to the proposed guidelines. Previous industry submissions have often been complementary but this is the first time every major telecom operator has spoken with a single voice. One could argue that this is a sign of widespread collusion among incumbent telecom operators in South Africa or perhaps simply a sign of collective industry indignation at the counterproductive steps being taken by the Ministry of Communications.

The submission makes a number of arguments.

51% African or South African Ownership

The operators argue that insisting on 51% “African or South African” ownership doesn’t make a lot of sense as it may inhibit the spread of competition in undersea cable access (the IWTGC cable comes to mind) and South African companies already comply with BEE requirements. The submission goes further to argue that the Minister has exceeded her authority in using Section 21 of the Electronic Communications Act to require majority African or South African ownership of undersea cables. It is hard to deny this argument and indeed to understand why the DoC is sticking to its guns on this issue.

Rapid Deployment

The submission also argues that the proposed guidelines, rather then facilitating “rapid deployment”, actually introduce an additional approval stage which will only increase the amount of red tape. The guidelines also do not “provide procedures and processes for obtaining any necessary permit, authorisation, approval or other governmental authority” as is indicated in Section 21 of the Electronic Communications Act. The operators argue that the guidelines would be better described as “Submarine Cable Authorisations”. Again, it is pretty hard to argue with their case. It seems evident that the “rapid deployment” guidelines, as they are currently described, are going to result in slower deployment .

Trampling on ICASA

The operators also point out that much of what is covered within the proposed guidelines, is already covered by the authority of the Electronic Communications Act and ICASA. They have declared their intention to ignore the guidelines as they believe they have “no legal standing.”

The Economics of Undersea Cables

I have to admit I was pleasantly surprised by this submission at least until I came to Chapter 7 entitled “The Economics of Undersea Cables” in which:

“the operators noted that although they support the principle of open access there still needs to be incentives for operators to invest in cables; and thus the operators support the concept of justifiable price discrimination between investors and non investors”

they say that:

“If a consortium, by virtue of an ‘open access principle’ was forced to sell bandwidth to investors and non investors at the same price – there would simply be no incentive to invest.”

This is what I dislike about the term “open access“. People seem to lay claim to it under almost any circumstances, so much so that it has lost some of its weight as a strategic approach. Surely it is not hard for the operators to see that if they are an investor in the cable and they are forced to buy bandwidth at the same price as non-investors, that they would still enjoy a de facto discount as a result of the profits from their overall cable investment. Investing in undersea cables is a profit-making enterprise on its own, as Seacom (with no telco operator investment) provides evidence of. Open Access proposes structural separation of communication infrastructure to increase consumer choice at every level of communications infrastructure from cables to data to services. This poorly argued and manifestly incorrect explanation of the “economics of undersea cables” mars what is otherwise an important message to the Department of Communications.

ICASA: Death by Bureaucracy

Published
by
Steve Song
on 8 February 2008
in Telecom Policy
. 4 Comments

“…broadband thrives on a mix of competition and active regulation, to ensure an open context.” This succinct summation comes from an Economist article from a couple of weeks ago entitled “Open up those highways“.

Contrast this with news yesterday that ICASA are apparently deliberately privileging incumbent telcos (Telkom, Vodacom, and MTN) by creating a two stage process in granting licenses for self-provisioning (the deployment of one’s own telecom infrastructure). Incumbent telcos are being granted electronic communications network services (ECNS) licenses while existing VANs (Value Added Networks) were only granted the right to purchase access from the incumbents. The bureaucratic-speak and legal waffling used to explain this decision are evidence that there is little sense of urgency at ICASA around the need for more competition and consumer choice in the telecom sector in South Africa.

By coincidence this is in stark contrast with with the Consultative Paper on the Implementation of a Unified Licensing Framework and New Market Structure released for comment earlier this week by the Communications Commission of Kenya. The document is a model of clarity and straightforwardness. Here are a few excerpts, a clear Open Access layer separation:

“The Commission further adopted in principle a unified licensing and regulatory model with the following as the main segments of the future market structure:

    • Network Facilities Provider (NFP) – who shall own and operate any form of communications infrastructure (based on satellite, terrestrial, mobile or fixed)
    • Applications Service Provider (ASP) – to provide all forms of services to end users using the network services of a facilities provider
    • Contents Services Provider (CSP) – to provide contents services such as broadcast (TV& Radio) material, and other information services and data processing services etc.“

and

Cross-subsidization between the various license categories shall not be allowed. Firms with multiple licenses shall be required to structure their operations and submit distinct operational accounting returns to the Commission as part of their quarterly and annual compliance returns for auditing purposes.

and finally

With the exception of areas where there exist natural limitations say in spectrum availability, the number of licensee in all other areas will be determined by the market.

Reading this paper and the feedback included from the operators, you get a sense the Kenyan digerati have really got their act together.