Digital Terrestrial Television state of readiness: input by Department of Communications, Post Office, Sentech, ICASA and USAASA

Meeting report

Opening Remarks

The Chairperson opened the meeting by welcoming the delegates from the Department of Telecommunications and Postal Services (DTPS) and its entities, and said that they would be briefing the Committee on the state of readiness to rollout Digital Terrestrial Television (DTT). She proceeded to the adoption of agenda, which was adopted as it was.

The minutes of 29 August 2014 and 5 September 2014 were considered and adopted, with minor amendments.

The Chairperson said a workshop would be held in the coming week. She was in consultation with relevant stakeholders to finalise the time. The Committee had planned on oversight visit in the following week, but she regretted that she would not be available. The oversight visit was, on that basis, postponed until further notice. Before handing over to the Director General, she asked the Committee whether they had questions concerning clarification on the state of readiness.

Ms M Shinn (DA) sought clarity on the Committee’s capacity building and asked what the Universal Service and Access Agency of South Africa (USAASA) was about.

Mr C Mackenzie (DA) asked about the SA Post Office’s (SAPO’s) media release of 29 August 2014 relating to labour unrest and worker demonstrations. Since then there had been no other brief from the SAPO regarding these issues. He was receiving complaints from SAPO customers that its business was not fully operational and thus they could not receive services. When they did inquire whether the SAPO was experiencing irregularities and backlogs due to strikes, SAPO was responding that there was no such a thing as the issue of a strike had been resolved. He asked whether the SAPO had a contingency plan in place. He suggested that they issue a press release on whether labour unrest was over, and send a memorandum to the Committee on the labour situation.

The Chairperson said the Minister had clarified the issues around the SAPO, explaining the nature of the strike. He had spoken in the isiZulu. With reference to the Committee’s capacity, she said that from the outset, the Members had agreed that they would be accommodating entities and organisations whose work fell within the scope of the Committee’s oversight.

Department of Telecommunication and Postal Services (DTBS)

Ms Rosey Sekese, Director General (DG): DTPS, apologised on behalf of Minister for his absence due to other commitments and introduced the members of the team that accompanied her. She then took the Committee through presentation, which focussed on the finalisation of the Broadcasting Digital Migration (BDM) policy, on what will follow after the finalisation of the policy, and on the preparatory work.

With regard to finalisation of the policy, the DG said that the DTPS was still waiting for the executive to finalise the BDM policy, and that the manufacturers and distributors would not act in terms of making or distributing Set-Top Boxes (STB) until the BDM policy was finalised.

The DTPS’s role included the facilitation of the STB installer training, coordinating marketing and awareness programmes, participating in the SA Bureau of Standards (SABS) standards-making process for the Digital Terrestrial Television (DTT) broadcasting environment, and revising the STB subsidy scheme.

In order to rollout the DTT, the DTBS collaborated with various entities that played different roles. The main role of the DSPS was on oversight and monitoring. It would manage the procurement process for subsidised STBs. With regard to education and awareness programmes, the DTBS would establish a Digital Broadcasting call centre.

With regard to USAASA, it would initiate the subsidised STB procurement process, publish qualifying criteria and define households qualifying for STB subsidy schemes.

She said that the Minister would further brief the Committee on the rolling out of DTT.

Sentech

Dr Setumo Mohapi, Chief Executive Officer: Sentech, briefed the Committee on Sentech’s state of readiness to roll out the digital terrestrial television. He said that the South African DTT network had been designed in accordance with International Telecommunication Union (ITU) guidelines and international best practices, to provide national terrestrial coverage for fixed installations and portable reception. The network consisted of 182 terrestrial transmitter sites, with a mix of high, medium, and low power solutions used to provide terrestrial coverage. The Independent Communications Authority of South Africa (ICASA) had issued regulations for two multiplex (MUX): MUX 1 for SABC and community broadcasters and MUX 2 for MNET and e-TV.

The network would achieve 84% population coverage (that was 178 sites), with the remainder of geographic locations being serviced by the Direct-to-Home satellite (DTH-S) service. Of the178 migration sites targeted, 154 had been completed. Four of the 178 migration sites were “Greenfield” sites. The Network Rollout Project Plan had been completed in Free State, Gauteng, Kwazulu Natal, and Limpopo. In progress were two in sites in the Eastern Cape, one in Mpumalanga, one in North West, ten in Northern Cape and eight in the Western Cape.

Dr Mohapi said that the head-end was upgraded for DTT and that after laboratory proof of concept, a pilot Direct-To Home (DTH) compatibility system had been established for the Gauteng single-frequency network (SFN), in order to prove stable operation in a live environment. The system would enable efficient use of transponder capacity for both DTT and DTH. He acknowledged that that technology was, at the time, in a testing phase, with completion planned by the end of the financial year.

By use of diagraphs, he explained the operational or functional model of an integrated network and network management system.

With regard to strategies and DTT to DTT migration, he stated that it was critical and prudent to consider an Analogue Switch-Off (ASO) approach that would have a low impact on viewers and television broadcast services. The suggested ASO approaches include:

·         National approach;

·         Protection of services approach;

·         Phased approach;

·         Hybrid model protection of services and phased approach.

He recommended the hybrid model protection of services and phased approach, and said that it was Sentech’s intention to implement the full digital to digital migration plan within two years of the analogue switch-off.

With regard to the time scale of the Network Rollout Project Plan, he stated that by September 2014, the plan had been approved, its funding confirmed and other requirements finalised. The tender and purchase process would be completed by no later than December 2014. By February 2015, delivery lead times would be in place, and by March 2015, the call centre would be launched.

Dr Mohapi said that broadcasting matters in the commercial and legal context were under negotiation, especially with e-TV and M-NET. Sentech had concluded an agreement with SABC. He expressed his concern about community broadcasters’ inability to afford the network. In that regard, Sentech had engaged with the DTPS to assist in funding them.

ICASA

Mr Rubben Mohlaloga apologised for the absence of ICASA’s Chairperson due to other commitments, and said he would brief the Committee on his behalf. His presentation would focus on the regulatory framework, signal transmission, technical standards, licensing, licensing of new entrants, and local content regulations.

With regard to the regulation context, he referred the Committee to the Digital Migration Regulation of 2012 and the Promotion of Diversity and Competition on DTT of 2014. The Joint Spectrum Advisory Group had been established to deal with the licencees on spectrum matters related to digital migration, and the Digital TV Content Advisory Group would deal with stakeholders on content needs for consumers to switch to DTT.

With regard to DTT signal transmission, he said that South Africa had adopted the DVB-T2 standard which was 50% more efficient than DBV-T1. It would increase signal transmission in television channels.

With regard to technical standards, he said that the most critical aspect of DTT was the Set-Top-Box (STB) manufacturing. The ICASA could not go ahead with plans outlined on the licensing spectrum until there were proper policy directives from the Department. The STB was, however, included in ICASA Type approval framework. The ICASA had set out the standards framework, which he referred to as the “iDTV standard.” He said that there was a need to align standards with other larger markets.

Concerning the licensing spectrum, he said that the ICASA had licenced the use of multiplex (MUX): MUX-1, MUX-2, AND MUX-3. Licensees of MUX 1 were the SABC and community broadcasters whereas licensees of MUX 2 were eTV and M-NET. Commercial free to air (FTA) and subscription broadcasters were licensed in terms of MUX 3.

In the context of licensing of new entrants, the ICASA published an invitation to apply for commercial free-to-air television on 29 August 2012 and had issued conditional licences to:

·         Close TV

·         Mindset TV

·         Mobile TV

·         Kagiso TV

·         Siyaya TV

He explained that the local content in the digital era was not yet defined. The content would be published after the regional public consultations that were taking place at the time of the brief and after the finalisation of regulations in 2014 and 2015.

Mr Mohlaloga said that the ICASA was ready and open for channel authorisation. It was just waiting for a declaration of the dual illumination period.

Universal Service and Access Agency of South Africa (USAASA)

Mr Thabo Makenete, Manager: USAASA, took the Committee through presentation, which focussed on the South African digital television system. Firstly, by use of a chart, he explained the BDM value chain, which would be guided by the DTT regulations and BDM policy. He proceeded to state the role of USAASA in the pre-launch of BDM as follows:

·         Appointing STB/antenna (subsidised) manufacturers, through an open tender process;

·         Determining the qualifying criteria;

·         Developing the process of subsidy applications and disbursements, in line with the qualifying criteria and other policies;

·         Together with SAPO, managing the full rollout of subsidy management systems;

·         Appointing and training of installers (in partnership with FET colleges);

·         Determining STB order requirements and distribution thereof, using statistical information and subsidy application patterns;

·         Managing the ordering of STBs from approved manufacturers and distributing them to SAPO warehouses.

In the post-launch phase, USAASA would oversee the application, distribution and installation value chain, as implemented through SAPO, and manage the disbursement of funds to all parties involved.

It would not play a role in creating public awareness, the distribution of STBs from SAPO to households, maintenance and reverse logistics, or the DTT call centre.

He told the Committee that there were 12.8 million TV-owning households in South Africa and that 42.9 million individuals had access to a working TV set. The estimated cost of subsidising the provision and installation of set-top boxes was just over R4.3 billion, against a budget of R2.4 billion, leaving a projected shortfall of over R1.9 billion.

The project deliverables that were met included statistical data acquisition and mapping and subsidy application form design and printing. Projects in progress and running concurrently included the appointment of manufacturers, developing the slide scale qualifying criteria and subsidy application process, and the USAASA/SAPO service level agreement.

The post-launch tasks were to order STBs from appointed manufacturers, oversee the subsidy application and approval process, oversee the distribution and installation of STBs in qualifying households, and the facilitation of payments.

Mr Makenete described the internal measures that had been taken to ensure delivery, and said that qualifying criteria would be published on 26 September 2014 in the Government Gazette.

South African Post Office (SAPO)

Mr Anton van Vuuren, Chief Executive Officer: SAPO took the Committee through the presentation, which covered the project mandate, system solution design, distribution, operational readiness and status on key deliverables.

The project mandate included the processing of applications during the pre-registration phase; the ordering, warehousing and distribution of STB equipment, payment and delivery of STB equipment, the processing of installation layouts, and the exchange of equipment. SAPO’s system solution design and distribution readiness were illustrated through the use of diagrams.

Mr Van Vuuren said that SAPO was ready to distribute the manufactured STB equipment. The total number of the STBs to be distributed nationwide was 5 200 000. They would be distributed as follows: Northern Cape (113 063), Free State (355 165), North West (398 231), Mpumalanga (474 378), Western Cape (529 552), Eastern Cape (560 505), Limpopo (585 840), KZN (895 738) and Gauteng (1 287 529).

The STBs would be distributed over a period of three years. The launch of the pilot pre-registration phase was scheduled for 10 February 2015, and was expected to end on 28 February 2015. The launch of the pilot STB equipment distribution phase would start on 1 April 2015 and end on 30 April 2015.

In order to perform its task efficiently, SAPO had set out targets or key deliverables, as well as the dates on which they were expected to be completed.

Discussion

Ms N Ndongeni (ANC) sought clarity on how the DTT would empower poor communities, and what strategies were in place to educate elderly people?

Mr McKenzie asked about the massive awareness campaign, and how much it could cost. With regard to the poor communities, he asked whether a distinction had been made between citizens and non-citizens, or whether non-citizens (including illegal immigrants) would have access to STB subsidy schemes. With reference to the three-year switch-over period, he asked if whether this exercise would not interrupt the traditional transmission signals. Did SAPO have a contingency plan to deal with labour unrest and strikes? If the answer was yes, what were they? Was SAPO under Sentech, or how did they collaborat? What measures had they in place to assist the poorest of the poor?

Ms Shinn questioned the delay in the finalisation of the DMB policy. What were the causes of the delay and what was the impact of the delay on the rollout of the DTT? She asked how tenders were issued, how entities had been appointed to be part of the DTT rollout plan as “service providers,” what the cost would be for the installation of the STBs per household, and the total cost of the DTT rollout programme.

Ms M Mafolo (ANC) sought clarity on whether digital broadcasting would affect the analogue TV signals.

Ms D Tsotetsi (ANC) asked about the collaboration between the DTPS and Further Education and Training (FET) colleges, and between entities and FET colleges, and which FET colleges they had identified for the pilot project. She asked ICASA who it had consulted in establishing the DDT regulations. SAPO was asked how long it was taking to process an application for registration.

Ms L Maseko (ANC) asked whether the DTT rollout programme would be first launched as a pilot project, or a total rollout. In the case of the latter, how did they intended to do it? She sought clarity from USAASA on the commencement of the procurement, and STB value chain management.

Ms J Kilian (ANC) asked how the DTPS and its entities intended to embark on the massive roll-out programme, and wanted to know the critical date on which the programme would be rolled out. She found it strange that the SAPO would play a role in the distribution, and termed such a role as merely “fighting a survival battle.” She expressed the fear that the SAPO would, due to such a role, come back to the Committee to request more budget. She appreciated the fact that USAASA, as an entity, had the capacity to deliver. She cautioned that the Committee should take seriously the uncertainty over the duties of the entities, and asked when the specified duties and responsibilities would become available. She remarked that the developed countries had not embarked on total migration from an analogue signal to a digital signal -- they first launched a pilot project to test its efficacy over at least a three year period. On basis of such a pilot project, they were able to estimate whether the DTT network was working perfectly, the cost involved, and whether people could afford the migration process. Why was this mechanism not employed?

The Chairperson said that the questions were reflection of the importance of what the Committee was dealing with. There were huge misunderstandings about what was happening in respect of the digital migration total rollout, especially how DTT migration would affect traditional signal transmissions during the process. The consequences of the digital migration were evident. Manufactures and distributors were no longer interested in the analogue TV sets and, as a result, they had started to dump them. As a Committee, Members had an obligation to protect the interests of citizens. She said that other countries were ahead of South Africa, and she sought clarity on how the problems being raised would be dealt with speedily, to meet the 2015 digital migration cut-off point.

Ms Sekese responded on the delay with the DBM policy, and said that the DTPS were appealing to the Committee for patience. She acknowledged that the digital migration cut-off point was set for 2015, and stated that people would be informed of the switch-off through letters, as well through other means of communication. The digital migration would not affect the analogue signals, as they would be used during the digital migration process. These issues were being looked into by ICASA.

The DG assured the Committee that non-citizens would not benefit from the STB subsidy scheme, as identity documents would be relied, or proof from the police would be needed.

With regard to a speedy rollout of the project, the DG said that there were n intensive discussions between the Department and its entities on how they could increase their capacity. The Department had no capacity to rollout the digital migration programme on its own. Partnership and collaboration was the key.

With reference to the awareness campaign, she said that communication was of paramount importance. To achieve that goal, the media that would be used included TV, radio, and print media. The DG said that there was discussion between her department and the Department of Arts and Culture to assist in the translation of the message into all languages. In addition, organisations and entities would be used as platforms to relay the massage to their communities, and the Department of Communication would assist for consumer messaging. Her department had allocated a budget for the marketing and awareness programme.

The DG assured Members that the National Treasury was ready to support the project in cases where a gap was encountered.

Mr Mohlaloga (ICASA) reiterated that the entity was ready and that the regulations were in place, authorising digital broadcasting. With regard to consultations, he said that the ICASA had consulted widely with different local producers, traditional leaders, and community-based organisations. It was the desire of ICASA for everyone to participate in the regulation process.

Mr Makenete (USAASA), with regard to empowering communities, replied that the digital signals would allow poor people to have many channels, and to access wi-fi services at some stage. The Department and entities had targeted STB installers from disadvantaged communities. People from disadvantaged communities would be trained at FET colleges and would be employed. The digital migration would create huge employment opportunities. With reference to the subsidy, he said that people had to apply through SAPO, and that the applications from non-citizens would not be entertained.

He said that the entities were integrated and connected in order to share information. He identified two critical modules -- safe finance and safe logistics. All service providers were on a data base and they had been awarded tenders on the basis of their ability to deliver, reputation and integrity. The issue of potential fronting had been discussed, and the criteria to determine whether people were flouting had been set out.

The USAASA had held discussions with the office of the National Treasury, and was simply awaiting the finalisation of the BDM policy.

Dr Mohapi (Sentech), using a South African map, illustrated how the digital network covered all the provinces of South Africa.

Mr Van Vuuren (SAPO) said that the SAPO was playing a critical role in various ways, including the processing of appplications during the pre-registration phase, the payment and delivery of STB equipment, and the ordering, warehousing and distribution of STB marketing material and equipment to SAPO outlets.

With regard to a contingency plan, Mr Van Vuuren said that there were clauses that could be invoked to deal with the issue of labour unrest. He remarked that the Committee had a negative perception towards the SAPO operations, and assured them that it had the necessary capacity to deliver and to be part of the digital migration project.

On the note of capacity, the DG echoed that the Department had concluded contracts with the entities after weighing up the risks. The partnership was based on the memorandums of understanding that set out the duties of each party.

Ms Shinn sought clarity on whether there was a memorandum between Telkom and the DTPS. She asked why the USAASA had not been given a chance to manage the DTT project, and when the DDT rollout project would come to an end.

Ms Mofolo remarked that the 2015 cut-off point would not be met, and appreciated the Sentech work in respect of geographical network coverage. She said the Committee still needed to conduct an oversight visit.

Ms Kilian sought clarification on the view of the manufacturers of analogue TV sets, and what the consequences of the digital migration to the manufacturing industry were.

The DG replied that the Members of the Committee would understand the rollout of the DTT project if they first understood the role and duties of each entity. Should the Committee allow her to submit an integrated plan, she would be able to provide more details on the timeframe and costs.

Ms Kilian expressed her fears in relation to the manufacturing and installation of STBs, and viewed them as critical areas where problems might arise.

Chairperson stated that what she could draw from the discussion was that close monitoring of the project was essential, and that the Minister, who was accountable, should brief the Committee. The Minister would be in a position to answer all the questions. The clarity sought on the memorandum between the DTPS and Telkom would be answered by the Minister. She said that the DTPS should send an integrated plan to the Committee.

The meeting was adjourned.