Policy and Regulation in an Era of Convergence

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Policy and Regulation in an Era of Convergence
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Terms of Reference

• We have been invited by the Select Committee on
  Labour and Public Enterprise to provide an
  objective overview on Convergence and Convergence
  experiences internationally

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Delegation

• Benito Lekalakala Executive
• Nozicelo Ngcobo Senior Manager (Parliament)
• Keso Mbali Senior Specialist (Convergence)
• Kenny Pasensie Specialist
• Leanda Kleinbooi Specialist

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Discussion Points

• Pre and post Convergence Mapping
• Convergence in Malaysia
• Key policy considerations w.r.t. Convergence
• Convergence and Social Obligations

• Definitions of Convergence
• Types of Convergence
• Drivers of Convergence
• Key principles on Convergence

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What is Convergence?

• There is no universal definition of Convergence.
• Convergence can mean-
• Provision of various communication services like
  text, data, image and video over the existing
  infrastructure
• Development of new infrastructure for handling
  multimedia transmission
• Managing of technologically and commercially
  distinct markets such as Broadcasting,
  Publishing, Cable TV, Fixed Voice, Cellular
  Mobile Services and Internet Services
• Most countries had adopted definitions closely
  aligned to the achievement of national objectives
  through use of ICT

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Types of Convergence

• Convergence of Technologies
• A common platform to deliver Voice, Data and
  Video services
• Convergence of Services
• Delivery of multiple services to the end users
  over the same medium/ network
• Regulatory Convergence
• Establishing a single Regulatory Authority by
  blurring the regulatory boundaries for
  telecommunication, information technology and
  broadcasting

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Drivers of Convergence

• Technology
• Markets
• Customers
• Regulation

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Drivers of Convergence1

• Technology
• Digitisation of transmission and switching
  networks
• Global networks based on packet switching and
  open standards (IP)
• Increase in Processing power of Computers
• Market
• New markets and services such as Multimedia
  services,Video on demand, Interactive TV,
  Internet Telephony, MNet, etc.
• Integration of content service providers with
  access providers e.g. SABCs NewsBreak
• Emergence of new Market players based on
  potential of ICT e.g. 35050 services

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Drivers of Convergence2

• Customers
• Cheaper access to communication
• Option for new value added services in a modular
  fashion
• Single Information Socket (for phone, data,
  video)
• Regulation
• Reduction in cost of regulation by optimum
  utilisation of regulatory resources e.g. merger
  of SATRA and IBA
• Ease of Regulation and Interconnection

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Convergence Mapping Pre-Convergence
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Convergence Mapping Post Convergence
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Types of Licenses

• Individual licenses
• Radio Frequency Spectrum licences
• Communications network services
• Broadcasting services
• Other services (as may be prescribed)
• Class licenses
• Communications services
• Application services
• Other services (as may be prescribed)
• Licence exemptions

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Convergence in Malaysia

• Malaysia considered a good case study in
  understanding and implementing Convergence
• Malaysia follows a dual licensing regime
• Malaysia has experienced some market failure from
  which SA can draw lessons
• 138 individual licensees 123 class licensees
• Majority of licensees are unprofitable
• Investment in the sector is low

Source Impact Survey 2004 conducted by NRA
Malaysia
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Key Principles on Convergence

• Clear Regulatory Environment
• Effective Independent Regulator
• Self-regulation Co-regulation
• Technology-neutral
• Fair Balanced outcomes
• Consultative Public process

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Licensing in an era of Convergence

• Rethinking the basic tenets of telecommunications
  regulation, licensing and spectrum management
• Convergence is raising a dizzying array of
  regulatory and legislative issues that
  policy-makers and regulators will have to
  address
• How can they move to a converged licensing
  framework without unduly benefiting either
  incumbents or new market entrants?
• How can the licensing regime attain societal
  objectives such as universal service?

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Key regulatory considerations to narrow the
digital divide

• The link between convergence and competition has
  a direct impact on the movement of the digital
  divide
• While infrastructure roll-out is key, it is not
  the only way to narrow the digital divide
• Content, via that infrastructure, must be
  accessible and relevant to those at the bottom
  of the digital divide
• Access, interconnection and interoperability
• Thereby supporting a consistent horizontal
  approach to regulation and licensing
• Licence conditions
• Efficacy of USO schemes to determine whether they
  are assisting those who cannot to pay for ICT
  services

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Convergence and Social Obligations

• You play, you pay
• From a societal perspective, what does a license
  mean in terms of improving quality of life
• ICT represents an opportunity for economic
  development and poverty alleviation
• How can convergence benefit a normal man on the
  street?
• Unrealistic comparisons to countries such as
  S.Korea should be reconsidered
• SA needs a South African approach to convergence

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Concluding remarks

• South Africa needs a South African approach to
  Convergence
• Prioritisation of regulatory challenges for
  optimum utilisation of regulatory resources
• Drawing the roadmap for implementation of
  convergence
• Need for efficient and timely dispute resolution
  mechanisms for converged licensing regime
• Capacity and expertise building in the regulatory
  bodies to meet the challenges of convergence

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Thank you

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