Telecommunication Unit Portfolio Committee Presentation

1. Presentation to the Portfolio Committee on Communicationsby the Telecommunication Unit Presented by : Peter Hlapolosa Date : 08 October 2004

2. Outline of Presentation • Mandate • Strategic Objectives • Past Achievements • Major Deliverables for 2004 / 2005 • Challenges • Conclusion

3. Mandate The Telecommunication Services Division exists in order to regulate telecommunications and for that purpose to: • Promote the provision of a wide range of telecommunication services in the interest of the economic growth and development of the country. • Promote the universal provision of telecommunication services. • Ensure fair competition within the telecommunications industry through licensing more operators. • Encourage ownership and control of telecommunication services by persons from historically disadvantages groups. • Promote and facilitate convergence of telecommunications, broadcasting and information technology.

4. Strategic Objectives • To licence new operators to make telecommunications services more accessible. • To regulate the tariff structure of the sector to make telecommunication services more affordable • Create conditions necessary for the growth of the sector, and contribution to the economy. • Promote Job creation through licensing new operators.

5. Past Achievements 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

6. Past Achievements Licensing, Enforcement and Number Administration • Initiated 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. • Commenced work on the amendment of Telkom’s licence in preparation for competition. • Developing a Central Numbering Database as required in terms of the Act. • Amended WBS licence • Amended Sentech Licence

7. What are the priorities – what high impact issues require focus • Revised Rate Regime for fixed line services • Under-serviced area licences • Review of Telkom’s licence • SNO licensing project • Carrier Pre-selection • Numbering Plan • Number Portability

8. Rate Regime Review • The fees and charges by fixed line operators will be reviewed to ensure that service charges are cost-based • Telkom would be providing ICASA with cost information by 30 September 2004 • Reasonable charges will ensure that services are affordable

9. Carrier Pre-selection regulations and Functional Specification • Carrier Pre-Selection (CPS) allows a subscriber to choose either on a call by call basis or by prior arrangement which Public Switched Telecommunications licensee to use for national long distance calls and/or international calls. • CPS is a competition enabling tool that aims to lower long distance call costs and international call costs. • The Carrier Pre-Selection Project consists of several sub-projects: • Carrier Pre-Selection Regulation • Functional Specification Regulation • Cost Recovery Regulation • Order Handling Regulation • Public Awareness Campaign

10. Under-serviced area licences • Licensing of new operators in which previously disadvantaged individuals (PDIs) will own equity shareholding as well as realising job opportunities in the newly licensed operators • Finalise Phase 1: Licensing of 7 USAL’s • Begin work on Phase 2: Licensing of 10 USAL’s

11. Review of Telkom’s licence • Amend Telkoms licence to prepare for the licensing of the SNO • This would ensure the attainment of the governments policy of liberalising the various sectors of the economy

12. SNO licensing project • The Authority is finalising the draft licence for the SNO • The licensing of the SNO will bring to an end to Telkom’s exclusivity and enhance competition in the fixed line market

13. Numbering Plan • The Numbering Plan describes the high level structure of numbering in the country and the numbering conventions available to the telecommunications sector setting transparent, objective and non- discriminatory numbering practices. • This would pave the way for a competitive environment ensuring the success of new entrants in the market.

14. Number Portability • Number Portability can be regarded as a user right to keep his/her number when he/she decides to change his/her operator or service provider • Functional Specification Regulation • Cost Recovery Regulation • Order Handling Regulation • Public Awareness Campaign • Number Portability is a competition enabling tool which will ultimately have the effect of lowering call costs both for fixed line and mobile users

15. Challenges • Putting in place regulatory and licensing frameworks that will enable the implementation of the policy announcements made by the Minister of Communications. • Developing adequate capacity to properly regulate this growing sector.

16. Conclusion The Communications sector is experiencing exciting changes. We are very excited about these positive developments in the sector and hope that we will be in a position to make same contribution.