ICASA Budget Briefing to Portfolio Committee on Communications

1. ICASA Budget Briefing to Portfolio Committee on Communications Presented By Mandla Langa (Chairperson) Gerhard Petrick (Councillor and Acting CEO) Nadia Bulbulia Julia Hope Mamodupi Mohlala Lumko Mtimde Mbulelo Ncetezo Ryan Hart (Financial Manager)

2. OVERVIEW • Introduction • Review and Outlook • Law, Communications, Consumer Protection and Council Support • Telecommunications • Broadcasting • Engineeering and Technology • Budget • Conclusion

3. Law, Communications, Consumer Protection and Council Support LAW • ICASA operates in highly litigious environment and is constantly faced with litigation in that, as an adjudicatory and decision making body, its decisions and rulings are challenged in court by operators. • In the 2003/4 year ICASA faced 10 litigation matters. • Majority of cases are instituted in the High Court and the Supreme Court of Appeal, external legal Counsel (attorneys and advocates) is required. • The Legal Department budget of R3,000,000.00 in 2003/2004 for external legal fees. • The lack of budget results in decisions having to be made not to oppose matters in court and to abide by court decisions. • Increased funding would enable Legal to defend the decisions of ICASA more effectively.

4. Law, Communications, Consumer Protection and Council Support Communications • Media liaison. • Stakeholder liaison – a stakeholders meeting is held annually • The Communications Department exhibited at several events • Staff functions are coordinated for specific events.

5. Law, Communications, Consumer Protection and Council Support Consumer Protection • The Department intensified its outreach programmes • Held road shows in three provinces, namely Eastern Cape, Northern Cape and Mpumalanga. These provinces were chosen as a result of the analysis of complaints received. Visited towns, including Libode, Port St Johns, Qumbu Tsolo, Umtata, Qunu, Springbok, Upington, Kakamas, Mothibistad, Kuruman, Postmansburg, and Barkley West were visited and a positive response was received. • Addresses are given at Schools, public functions, clinics and municipal events and radio programmes are conducted for public education. • Promotional material is procured for these events. • Educational officers conducted public awareness programmes. • The Department has translated all material into all official languages. • A pamphlet – a guide to telecommunications has been produced and being distributed.

6. Law, Communications, Consumer Protection and Council Support Consumer Protection (continued) • A Memorandum of Understanding has been signed with telecoms operators on dealing with consumer complaints • Establish S17 committee of Council to deal with issues affecting people with disabilities in order to keep abreast of the needs and problems encountered by people with disabilities • Similar stakeholder committees and consumer groups would be established given increased funding.

7. Law, Communications, Consumer Protection and Council Support Council Support • Supported ICASA processes • Numerous hearings held in 2003/2004 coordinated by this unit • Books, publications and membership to professional organizations for ICASA are coordinated by this unit. • Increased funding would facilitate more intensive workshops for staff and Council to keep them updated with legal and technological developments.

8. Law, Communications, Consumer Protection and Council Support International Relations • ICASA supports and subscribes to TRASA, ITU, ATU, RIARC, SABA and participates in International ministerial meetings. • ICASA hosts TRASA Workshops and contributes a great deal to TRASA activities. • ICASA was appointed to Chair RIARC at the last AGM. • With more involvement in International events, ICASA would be able to conduct studies and attend training to strengthen its regulatory capabilities in line with international standards. • Translations and interpretation costs are incurred with hosting delegations and translation of documents. ICASA further hosts visits from other African States.

9. Law, Communications, Consumer Protection and Council Support Key Outcomes for 2004/2005 • Minimise risk of litigation • Procure a complaints management system • Continue outreach and road shows • Enforce MoU on complaints handling • More regular Stakeholder meetings • Implement local media monitoring • Investigate establishment of call centre (which is intended to improve the image of ICASA and record and address all queries and conduct follow up exercises)

10. Law, Communications, Consumer Protection and Council Support

11. Telecommunications Policy Analysis • Finalised regulations i.r.o. COA/CAM for mobile operators • Finalised regulations i.r.o. PSTN-to-PSTN interconnection • Reviewed Carrier Pre-selection regulations • Developed guidelines for Trial and Launch of New Services • Developed guidelines for the legality of wireless local area networks (WLANs) • Commenced with the development of Number Portability regulations that will suit the needs of South African users

12. Telecommunications Licensing, Enforcement and Number Administration • Carried out most of the processes towards the licensing of Under-Serviced Area Licences. • Developed a comprehensive frame-work for the licensing and regulation of VANS and PTNS. • Developed a Numbering Plan that will encourage competition within the sector. • Began development of a Short Code Strategy for SA. • Started work on the amendment of Telkom’s licence in preparation for competition. • Updating and finalising terms and conditions for the SNO licence whilst amending the Telkom licence. • Developing a Central Numbering Database as required in terms of the Act.

13. Telecommunications Licensing, Enforcement and Number Administration (continued) • Undertook licence amendment process for Sentech. Application for amendment was brought by Sentech. Public process undertaken in terms of the Act, amendments were finalised and effected subsequent to public process and amended licence was issued to Sentech. • Undertook licence amendment process for WBS. Application for amendment was brought by WBS. Public process undertaken in terms of the Act, amendments were finalised and effected subsequent to public process and amended licence was issued to WBS. • In the process of rectifying a breach committed by Swiftnet with regard to the minimum of 30% shareholding to be vested in the hands of historically disadvantaged individuals. Rectification of the breach involves the undertaking of a licence amendment process. • Continuously in process of clamping down on illegal providers of telecommunication services. • In the process of dealing with access to 1800MHz and 3G frequency spectrum bands by the Mobile Cellular Telecommunications Service licensees.

14. Telecommunications Key Objectives and expected outputs for 2004/2005 • Second phase of Under-serviced area licensing. • Finalisation and issue of the SNO licence. • Finalisation and issue of amended Telkom’s PSTS licence. • Development and subsequent management of central numbering database. • Finalisation of the short code strategy. • Development of functional specification and order handling. • Development of Mobile Operators QoS Audit Performance Indicator regulations. • Development of Telkom/SNO service target audit performance indicator regulations. • Finalisation of number portability regulations. • Undertake a review of fixed line tariff regime. • Implement COA/CAM for mobile operators. • Implement COA/CAM for PSTS. • Undertake a formal market determination in the sector.

15. Telecommunications Outline the extent of DFID assistance NB: The above are the direct monetary benefits. It does not include indirect benefits such as organisational capacity building, advisory services and sector developmental benefits.

16. Telecommunications

17. Broadcasting Policy • The Review of Ownership and Control of Broadcasting Services and Existing Commercial Sound Broadcasting Licences. • Position Paper on Local Television leading to the licensing of SABC 4 and SABC 5. • Discussion Paper on Subscription Broadcasting which will lead to possible licensing of satellite subscription broadcasting services. • Amendment of South African Content Regulation to rectify certain discrepancies between Position Paper on “South African Content on Television and Radio” and the Regulations as originally gazetted. • Position Papers completed under year of review: • Sports Broadcasting Rights • Low Power Broadcasting • Published Code of Conduct for Broadcasters and technical amendments to the South African Television Content Regulation of 2002.

18. Broadcasting Future Policy Project 2004/5 • In 2004/5 financial year the department will be focusing on the following policy projects: • Review of Community Radio Policy. • Review of Signal Distribution. • Ten Year Review of Broadcasting Regulation in South Africa. • Review of advertising and sponsorship rules. • Programming requirements for the disabled and the elderly. • ICASA throughout its Broadcasting Division monitored the 2004 Election successfully. The Authority monitored 44 502 items throughout the election period. The total data capture error ratio of 0,15% was achieve for the duration of the project.

19. Broadcasting Licensing • SABC Licence Renewal • ICASA renewed eighteen (18) sound broadcasting services and three (3) television broadcasting services. • Commercial Sound Broadcasting Services Renewals • Six (6) commercial radio services were renewed which are YFM, Jacaranda FM, Kaya FM, P4 Cape Town and Classic FM. • Radio Oranje were granted amendments to their application. • ICASA approved the Nail Transaction • ICASA completed the process of awarding 4 Year Community Broadcasting Licences to all nine provinces in South Africa.

20. Broadcasting Outcomes 2004/5 • Licensing of Subscription Broadcasting Services • Licensing of Community Services • Licensing of Low Power Broadcasting • Renewal of Orbicom Category 2 Signal Distribution • Proposed amendments to IBA Act

21. Broadcasting

22. Engineering & Technology Frequency Spectrum • Publication of Annual Terrestrial Broadcasting Frequency Plan • Issue Frequency Spectrum licences to Radio communications operators (4800 new) (total 89000) • Review and Migration of SABRE 1 & 2 to new integrated SAFTA • Participate, contributed to ITU conferences • WRC 2003 • Include WRC final acts in SAFTA • RRC planning conference for Digital Broadcasting • Process Equipment type approvals (±500)

23. Engineering & Technology Regions and Monitoring • Enforce compliance with the relative Act in terms of spectrum usage and stamp out illegal spectrum usage • Upgrade measuring equipment to trace and address interference • Install direction finding systems Johannesburg, Cape Town and Durban • Install DF facilities in Specialised monitoring vehicles • Contribute to initial RFI measurements in support of SKA bid • Project Spectra: Implement spectrum management tools

24. Engineering & Technology Key outcomes for 2004/2005 • Project Spectra: Improve the management, workflow and radio frequency coordination and assignment processes • Contribute to further RFI measurements in support of SKA bid • Enforce compliance with the relative Act in terms of spectrum usage and stamp out illegal spectrum usage • Conduct 800 MHz Sharing Studies • Spectrum Planning and co-ordination • Preparing for ITU RRC on Digital Broadcasting • TRASA spectrum planning; L-Band and Digital Broadcasting • Spectrum Licensing • Monitoring and interference mitigation

25. Engineering & Technology

26. Overview of Financial Results

27. Reasons for Surplus

28. VAT Funding not Received

29. Revenue Collection - NRF

30. Overall Lack of Funding

31. Continued Lack of Funding

32. Funding Model Adequate funding is imperative for an effective and independent regulatory agency, as it will: • Allow ICASA to respond to the dynamic regulatory requirements for managed liberalisation; • Enable ICASA to hire and retain the right people; and minimise risk of failure; • Prevent regulatory capture and reliance on the industry for critical regulatory data that can influence the Regulator to make decisions reflecting industry interests, rather than decisions based on independent analysis and the public interest; and • Eliminate obstructions that would prevent ICASA from rendering its decisions based on professional and technocratic expertise.

33. Funding Model Adequate funding for our projects has the following positive impact: • Broadcasting and Telecommunication are highly sensitive to technological changes, adequate funding will ensure quick responses to new technological advances. • Deliver on time. • Ensure retention of good personnel. • Hire the best skills.

34. ICASA Staff Turn-Over ICASA Staff Turn-over 2003/2004