PAKAMILE PONGWANA

South Africa’s International and National South Africa’s International and National CompetitivenessCompetitiveness

3-4 February 20153-4 February 2015

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

How far have we come?How far have we come?

1994 – 2015 Milestones [ Fixed Market]

•Before 1994: only one fixed line operator• Less than 4 million lines in operation

•2015: • 4 mobile operators covering more than 99% of the population• Over 100 fixed line service providers • Fixed line use has stagnated

1994 – 2014 Milestones [Mobile]

• South Africa has moved from 2 Mobile Network Operators (Telecommunications Act) 4 MNOs by 2012 (ECA), where the limit is governed by available spectrum

•The mobile data market is a growing market, with growth rate reported at XXX % in 2014?

•Universal Service:• 99% population coverage for mobile voice services

• 48th in the world according to the WEF

•Termination rates:• Down from R 1.25 in 2009 to R 0.20 in 2014 – 84% reduction

•Retail prices:• 2002: • 2015:

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

How far have we come?How far have we come? •South Africa has moved from 2 Mobile Network Operators (Telecommunications Act) 4 MNOs by 2012 (ECA), where the limit is governed by available spectrum

•Universal Service:99% population coverage for mobile voice services Estimated 60 million unique SIM subscribers48th in the world according to the WEF

•Demand for data exploding:•80% growth for Vodacom in 2014•Forecast mobile data growth at a compound annual rate of 53% by 2018 (Cisco).

•Termination rates:Down from R 1.25 in 2009 to R 0.20 in 2014 – 84% reduction•Retail prices:2005: Approx. R 3.20 2014: Approx. R 0.60 (reduction of 81%)

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

How far have we come?How far have we come? 1994 – 2014 Milestones [ Broadcasting ]

1994: • one free to air broadcaster (SABC)• One subscription service (Mnet)• Limited commercial & radio stations

2015:

•A total of 255 Broadcasting Sound (Radio) licensees, whilst there are 12 Broadcasting Television licensees.

Radio Stations

Television

Community 230 5

Commercial 19

1 FTA 2 subscription 5 recent additional licences

Public broadcaster 18 3

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

How far have we come?How far have we come?

International infrastructure

1994: 1 cable Telkom controlled 2015: 6 cables multiple owners

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

How far have we come?How far have we come?

2015 Local Infrastructure:•National connectivity:

• Telkom: 140,000 km• Neotel/BBInfraco: 10,000 km• Fibreco: approx. 2,000 km• Vodacom/MTN/Neotel: 5,000 km

•Local Access• Fixed Line: approx. 4 million copper lines

fixed wireless in major centres• Mobile: Sites Vodacom MTN Cell C Telkom

Total 9348 7413 4000 2406LTE 700 800 100 1132% LTE 7% 11% 3% 47%

So

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

International competitivenessInternational competitiveness

Where does South Africa stand:

ICTs are the driver of GDP in the futureSA GDP ranking is 33rd in the worldThis will fall if we are unable to leverage and enable internet deployment and use

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

Internet competitivenessInternet competitiveness

• SA is ranked 58th of 117 countries by OOKLA• SA has lowest top city high speed connection speed of

BRICS nations• SA is ranked 73rd according to WEF

1994 – 2014 Milestones [Mobile]

• South Africa has moved from 2 Mobile Network Operators (Telecommunications Act) 4 MNOs by 2012 (ECA), where the limit is governed by available spectrum

•The mobile data market is a growing market, with growth rate reported at XXX % in 2014?

•Universal Service:• 99% population coverage for mobile voice services

• 48th in the world according to the WEF

•Termination rates:• Down from R 1.25 in 2009 to R 0.20 in 2014 – 84% reduction

•Retail prices:• 2002: • 2015:

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

Contribution to employmentContribution to employment

•Total of 32 445 employees (June 2014)

•36% of workforce is female

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Policy Considerations for ConvergencePolicy Considerations for Convergence

Content

Mobile Networks

Fixed Networks

Broadcasters

InternetSocial applications – WhatsApp

videos

Access Avenues

Child Safety

Local Content

Policy Issues

Competition

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

ConstraintsConstraints•Human capital and innovation-

• Shortage of engineers and skilled workers

•Power supply• Current mobile retail prices are dependent on current electricity prices and supply

from Eskom• Forced use of generators will increase costs

•Spectrum delays in Digital Migration policy and Policy on High Demand spectrum

•Rights of Way – municipalities prevent licensees from deploying infrastructure

•Regulatory delays – lack of funding and adequate technical skills leads to long lead-times

and reliance on consultants to conclude regulation-making

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

OpportunitiesOpportunities

Network deployment:•Rights of Way – constitutional court recently ruled in licensees’ favour on the right to access and deploy infrastructure

Job creation:•Construction and electro-technical skills in deployment of networks•High demand for:

• Technical skills for repair and maintenance of networks• “low current” electrical as well as spectrum management engineers

South Africa could drive regional internet penetration and global access to the internet with partnerships with our neighbours:

• Cost-based access to under-sea cables• Cost-based access to long-distance backhaul services

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

Catch upCatch up

• Policy co-ordination• Conclude ICT Policy Review collectively• Review institutional make-up• Release spectrum policy

• Broadband Internet 4G• Release of spectrum

• Fast-track digital migration• Subsidise digital televisions• remove encryption

• Resolve funding challenges for:• ICASA• SABC• SAPO

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

Catch upCatch up

• Policy co-ordination• Conclude ICT Policy Review collectively• Review institutional make-up• Release spectrum policy

• Broadband Internet 4G• Release of spectrum

• Fast-track digital migration• Subsidise digital televisions• remove encryption

• Resolve funding challenges for:• ICASA• SABC• SAPO

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Strategic Outcome Oriented Goals (SOOGs) of ICASA

SOOG 1

SOOG 2

SOOG 3

SOOG 4

THANK YOUTHANK YOU