ICASA Candidates Shortlist: interviews

Chairperson: Mr M Lekgoro (ANC)

Documents handed out
None

SUMMARY
The Committee interviewed Ms Marcia Wilson from the University of South Africa, and Mr Gerhard Petrick from the National Research Foundation as candidates for the Independent Communications Authority of South Africa (ICASA). The selection process would be finalised in the following week and the decision of the Committee would be published in the press.

The interviews opened with personal histories and skills. Members sought the candidates’ views on the successes and failures at ICASA, the extent to which transformation in the industry had been achieved; whether ICASA was truly independent from the Minister of Communications, and how all South Africans could be provided with telecommunication services.

MINUTES
The Committee first determined the correct interpretation of the law regarding the term of office for a councillor. The State Law Adviser, Mr Kellner, and the Parliamentary Law Adviser, Mr F Jenkins addressed the Committee on whether the Chairperson served a five-year term from the date of appointment, or whether the term was dependent on his/her term as a councillor. The Committee agreed that Section 7 of the Act which provided for the appointment of councillor, was ambiguous and needed amendment. The amendment would be effected after the appointment of the councillor.

Interviewee: Ms Marcia Wilson
Ms Wilson had been in the telecommunications sector since 1994 and was the first person in South Africa to formally teach telecommunications, at the University of South Africa. She had also been a lecturer and researcher in the telecommunications environment since 1997 and 1994 respectively. The value which she would add to ICASA if appointed Councillor would be:

-An interdisciplinary approach in the area of regulation, which would encourage introspective as well as a forward looking attitude in policy making and in the evolution of the telecommunications industry.

-An extensive research engagement with the SADC regulators through which she had been able to make a synopsis and an analysis of the future regarding the telecommunications industry. On a high academic level especially through the manner of interaction at symposia with the industry she made projections as to the requirement of extensive training of staff in ICASA, which was not attended to due to budgetary constraints. It was crucial that the human resources to undertake the analysis needed be provided internally to help cut costs and manage ICASA’s budget.

Questions
Ms S Vos (IFP) noted that the interviewee had done a vast amount of work in the area of development of the Internet in South Africa, rights to privacy and marketing indigenous products on the Internet. She asked for her views on how best the regulator could affect accessibility for the majority of South Africans? How did she perceive the independence of the regulator against the background of policy imperatives and decision making of the Minister?

Ms Wilson responded that issues regarding the Internet should be tackled with caution because it required a balanced approach and should address other related issues such as illiteracy, computer literacy, infrastructure and profession. While access concerned affordability, it also required the provision of capacity building. There was a demand for the Internet that should be addressed because if affordability became an issue then demand would drop.

The independence of the regulator was a very contentious issue worldwide. Regulators were intermediate institutions between government and the telecommunications sector. This intermediacy had to be situated in an environment of accountability. The questions included what framework would be provided for an intermediate institution to ensure accountability, how much non-accountability should be facilitated and should non-accountability be associated with independence? The bottom line should be maintaining a healthy balance of accountability and entrenching a system that ensured this form of accountability. If there was absolute non interference from the government, the regulator would be captured by the market.

Ms N Magazi asked for her views on the role of South African women in the telecommunications sector and what were their chances of getting into leadership positions in the industry? In the Telecommunications Act, one of the clauses empowered the Minister to determine who got licenses in the other sectors.

Ms Wilson responded that the ICT Charter discussions two years ago had made projections about what an engendered ICT unit should look like. It was agreed that women should be given as many opportunities as men. However there should be sensitivity around the challenges facing women that were different from the ones with which men were faced. Some of these challenges related to banking environments and their willingness to give loans to women. For some strange reason, banks were not willing to give loans to women when they placed tenders or formed their companies. Therefore they faced more difficulties.

A lot of the women had tried to go into partnerships with existing companies but even in that environment; they were marginalised simply because they were women and because they struggled to get access to funding. The fact was that a law should be be created that would allow the regulator to enforce the policies in such a way that even in their small environments, and in the basic provisions of furniture, companies that were not gender empowered would not be recognized. If the regulator enforced the law, more changes would be seen. The sector liked to say there were no women and she would ask where the President got the women in Cabinet. It is interesting that the question was never answered. She believed that there were women who had the capability and extensive training.

At the University, it was noticed that women would not go beyond their honours level because of their gender roles, but currently, they were increasingly migrating beyond that which is an indicator that there were capacity in South Africa that had not been utilised as much it should be. It was important that women occupied senior positions in companies more so to empower other women to reach their positions. If that were done it would provide some support for women.

Mr Mohlalonga (ANC) followed up that if this scenario were applied to the independence of the regulator in the context of South Africa, what would be the key issues in the context of the independence of the regulator?

The key issues were that of frequency and spectrum which were surfacing even in the Convergence Bill. She would again answer the question with caution. The frequency spectrum was space that was owned by no one although it was now known that in terms of international legislation every country was apportioned a particular band of frequency to utilise for national purposes. One of those was military, which was very critical given the kind of technology that was evolving, the kind of surveillance that was carried out on countries without their awareness and the kind of interception of technology that could occur.

It would create problems if there were no proper monitoring of these activities. It meant the countries’ national security was exposed and vulnerable not just to external forces but to internal unstable parties who made money out of selling private data to people outside the country. The issue with the frequency spectrum was the oversight that was needed, which might be more specificity in the Convergence Bill protecting the users. It was dangerous where private conversations were captured by V- sats sitting above the public, which were uncontrolled and unmanageable. It was now known that mobile telephone conversations were not as secure as was predicted by the engineers. This was also displayed in the Internet and the extent to which persons broke security blocks in banks. This trend exposed itself in the management of the frequency spectrum as well. Not managing frequencies meant compromise on wireless communications.

Secondly, one of the issues that posed a concern was the cost of doing business. What would be the measures from the point of view of the regulator that could be factored in terms of dealing with the question of the cost of telephone?

Mr Mohlalonga asked her impression of the role of the public broadcaster in the context of independence.

Ms Wilson responded that the role of the broadcaster was articulated in policy that it should address public interests, provision of information and provision for a reflection of the diversity of this country. If the public broadcaster did not deliver, it then became an issue. However if policy did not provide for such duties, then there would be little ground to contest the role of the public broadcaster. If the SABC was fulfilling its contract vis-à-vis the Broadcasting Act, then it was doing its job. If more were required from the SABC then the policy would have to be amended. This was the only machinery available to monitor the public broadcaster.

She had listened to the debates in the media and there had been a question around how independent the regulator was from the Minister of Communications and what the Convergence Bill said about the independence of the regulator. She had not been privy to the details and discussion and the ‘behind the scenes’ events and would not be able to comment fully on that, although she would be able to answer the question differently. From an art perspective she would reiterate that it was a question of balance and how that balance was mastered. There was legislation providing for that balance. If the Minister was doing what was stipulated in the legislation, then she was doing her job because it could not be said that she was not undertaking what was in the law. If the regulator operated according to legislation then he was also doing his job and so reference must always be made to policy and the provision it made for balance in the oversight for regulatory matters in the sector.

Mr V Gore (ID) asked the interviewee to make further comments on the Convergence Bill.

The interviewee acknowledged that the Convergence Bill was one of the most innovative interventions that she had seen worldwide. South Africa was the first country to commence with a convergence framework. This occurred at a time when the regulators in the European Union were still undecided on how to parallel the evolution of converging technologies with a suitable policy framework. It must be acknowledged that South Africa was the first country to attempt it and also that with innovation and creativity, came challenges because it meant that the new legislation had not been tested. The country had to bear with the ‘growing pains' of new legislation.

The Convergence Bill had been so lauded that regulatory officials were visiting South Africa to find out the success and 'teething' problems associated with it. Industries were very excited about it abroad because South Africa had taken the initiative and provided the appropriate regulatory framework for an already converged industry. This was contrary to the argument that regulators lagged behind and that Government was not able to keep abreast with the technological changes and should therefore not be regulating, given the fact that the Convergence Bill tended to fill that gap as rapidly as it could given the policy framework within South Africa.

Teething problems should be anticipated and there would be markets that would need amendment as with any other legislation. The gaps would become more evident when it got to implementation mode. From experience these gaps would become more conspicuous with time. This reflected the most positive aspect of the Convergence Bill although it might need to cover more broadcasting issues around content. She did not know the reason for the caution or hesitance around it but definitely issues regarding content had to be articulated. For example, the question of whether it was the service provider or network provider or creator of content who bore the liability for the content had to be answered.

Mr V Gore asked what was the biggest problem the communications and broadcasting sector faced in South Africa. Previously it had been providing the majority with access to television signals, but now the problem was providing the majority of the users with telephone and Internet connections. Ms Wilson had mentioned that one of the ways of surmounting that problem was through tele-centres, which had raised the issue of the effectiveness of multi purpose community centres in the rolling out of communication data services. Views had been expressed that it was not the most effective way of delivering because the State was providing subsidies. The most effective way of providing these services was through competition. He asked for the interviewee’s views on the issue.

The interviewee responded that it should be remembered that government subsidisation initially was absolutely crucial given the digital divide in 1994. Without government intervention the industry would be many years behind. The provision in the universal service legislation that there was industry contribution to this was excellent because it ensured a public/private contribution towards the subsidisation model.

It must be commended that when these models were formulated, they were placed within very clear socio-economic environments. For instance, if a tele- centre was placed in Guguletu, a security system had to be installed. This provided an additional cost. It had to be recognized that one of the challenges that tele-centres faced was the issue of theft. The issue was not demand or that there was no need for it.

The socio-economic profile of the citizens in South Africa was known and it was feared that the subsidisation model was required for at least a while until it was believed that the digital divide had been addressed adequately. She could see at least ten years of sustained input by industry and government to ensure that the most marginalized communities were brought into the digital environments that had been created in the urban centres. In her opinion, private companies alone did not have the capacity to correct the digital divide. The private-public dual model was therefore crucial to correct the discrepancies.

Mr V Gore asked her views regarding the regulatory ‘grab industry’ that poached people who were trained in regulation - there had been many senior personnel leaving ICASA and going into these industries. Would she suggest that this trend be reversed?

The interviewee responded that that she had noticed that staff retention in ICASA and the telecommunications sector was a problem. Had government provided the ideal incentives for everyone in the regulatory environment? The Minister had said that given the fact that the regulator’s function would expand in view of the postal regulatory functions being incorporated into ICASA, it had become necessary to address the incentive mechanisms. These incentives did not have to be monetary but could be a variety of things for example, how much training was provided by the regulator to its staff? Telkom provided two years of opportunity for its staff to study abroad, or to do an MBA and advance their personal qualifications.

Was the regulatory environment’s budget sensitive to capacity building and development? It was unfortunate that personnel did not have contracts with the regulator that stipulated that if they were trained at government costs they would stay under the employment of the government for a certain length of time. There were a variety of ways of securing retention but it was common knowledge that most skilled people in government were moving to the private sector. One had to consider changing the environment in ICASA. A more strategic approach had to be adopted for the ways incentives were provided to staff and not rely strictly on open contracts.

Mr Pieterse said that sometimes there were unscrupulous persons who waited for personnel to get trained and then would poach them. Who did the question of independence relate to and from what? Sometimes companies were financially dependent on persons who advertised. Often when the concept of personal independence was pursued, it ended up in 'burning bridges'. Could Ms Wilson as a current academic, explain her kind of practical experience in the field and particularly in economics?

The interview responded that she had been doing some work with the ITU and had engaged regulators and industry players in Dubai and Somalia. She had led workshops throughout the Continent and in the SADC region on regulatory matters. She was the only person to engage the regulator when Government was trying to set up regulatory systems and structures with other continental representatives which met in South Africa in 1994. She had worked in an advisory capacity relating to workshops with most of the regulators throughout the Continent.

Her doctoral thesis focused on regulation in the Continent. Her passion for the subject was meeting the NEPAD goals, to ensure that regulators had a uniform understanding of what was required of them and that they also shared their expertise. For instance in situations where regulators discovered that they did not understand the pricing model, they met as a group and appointed a few experts to organise workshops for them. This enabled them bring down their costs for consulting. She had engaged regulators in the United Kingdom and tried to ensure that she kept abreast with regulatory challenges and experience.

Her experience may be academic but she believed she had interfaced extensively with regulators in the regulatory environment. She had also done some consultancy work for government, for instance the formation of the institutes of ICT, advanced ICT training and innovation. She had also advised government when it tried to analyse the Universal service model to ensure its effectiveness. She had done some work in relation to women and sat on the ICT Charter for a year while she did her doctoral degree. Being part of the ICT Charter alone had given her an insider view into the immediate debates and those she thought were on the other side of the digital divide and the challenges that were faced by the historically disadvantaged. The issues became a reality and also because the government took the ICT Charter seriously.

It was pointed out by a Member that currently there was the challenge of easy accessibility to pornography that exposed children and vulnerable persons to all kinds of influences. How would she as a Councillor manage the situation?

The interviewee responded that the issue of liability and the fact that it was missing in the Bill raised a concern. The government should impose some level of accountability on the service provider. If this was not done, pornography would become a 'free for all ' affair on the television and also via mobile phones. It would generate income for operators and if was not curbed by legislation, it became a problem. It was crucial that this issue was addressed early while the Convergence Bill was not yet promulgated. Persons should be held responsible for manipulating the business environment by imposing taxes on their profits. In the United States of America, there were devices on computers that prevented pornography but it all depended if South Africa was willing to protect children from the kind of indecency it posed.

Interviewee: Mr Gerhard Petrick
Mr Petrick informed the Committee of his background as an engineering technician. He had worked at the SABC in a number of divisions, which gave him great insight into every block in broadcasting. He had then worked in its signal distribution division which went on to become Sentech, and over the years became involved in digital broadcasting as well as the policy requirement for a new means of broadcasting. He wrote papers and looked at best practice models for licensing broadcast services and other telecommunications issues. He had then been nominated to fill a vacancy on the ICASA Council. When his term expired he joined the National Research Foundation (NRF) and was currently doing very exciting work on South Africa’s bid to host a giant square kilometer radio telescope and South Africa’s ability to provide a radio quiet zone. He stated that ICASA faced many challenges and it would not be a walk in the park, but he made a conscious decision to accept the nomination to serve another term.

Ms M Smuts (DA) asked Mr Petrick to explain whether he implied, when referring to South Africa’s bid for the square kilometer array, that frequency management had become very important. If so, he was asked to comment on the current quality of frequency management and how it was being dealt with in the draft Convergence Bill. She asked him to explain whether he believed that frequency management should sit in the hands of an independent regulator, and how this would be co-ordinated with other sectors.

Mr Petrick responded that radio quietness in terms of radio astronomy was akin to an optical telescope, where light would inhibit the possibility of seeing stars. Similarly for radio astronomy, if there were radio transmissions nearby the sensitivity decreased and it was not possible to pick up very small signals from space. Sustained radio quietness was thus vital for the establishment of the telescope.

He stated that ICASA was currently dealing with the issue of the quality of spectrum management. There was definitely room for improvement. The largest linkage shortcoming was linking the technical data, which indicated where a specific frequency was being used, to the licensee. These links either did not exist, were outdated or needed to be revised. This matter was on ICASA’s agenda. The database for communications licenses for spectrum users amounted to approximately 75 000 entries, and thus keeping that large a database up to date was a big task. More focus should be placed on this by ICASA.

Some of the comments made by the industry with regard to the manner in which it was dealt with in the Draft Convergence Bill expressed confusion as to who was responsible for the allotment as well as the allocation of a site for a frequency, which were two separate processes. Currently ICASA was involved in both processes and the Department of Communications also liaised with the Information Technology University (ITU) on the allocations. He believed there was a degree of confusion in the Convergence Bill and it must be addressed.

Ms Smuts asked Mr Petrick to comment on the progress made in digital terrestrial television and digital audio broadcasting and how it was being dealt with in the Convergence Bill.

Mr Petrick replied that digital broadcasting was growing from strength to strength in Europe. The pressure was on for South Africa to keep pace with Europe with regard to digital broadcasting in its preparations for the hosting of the 2010 Soccer World Cup. Germany was currently finalising its digital video broadcasting technology (DVBH), which allowed the terrestrial broadcasting of video footage to a handheld device, and Nokia was already manufacturing these devices. He expected that FIFA would place pressure on South Africa to provide this technology for the 2010 Soccer World Cup. Progress in this area was thus needed.

A recent announcement by government that greater focus would be placed on digital broadcasting was welcomed, and the complexity of the issue would require a dedicated task group. The Convergence Bill did not comment extensively on the complexity of introducing digital broadcasting. The important thing though was not to be bogged down by all the challenges, but instead to know where to start and to then move forward positively.

Ms Smuts stated that the Committee was informed that it was a FIFA requirement that South Africa be able to provide DVBH technology on 3G cellphones. She asked Mr Petrick to indicate what needed to be put in place to provide that technology by 2010.

Mr Petrick responded that South Africa should not pursue digital broadcasting for FIFA’s sake. The technology offered so much to South Africa, especially in terms of language and cultural diversity. The reason why South Africa was unable to broadcast in all eleven official languages in the metropolitan areas was because there was no spectrum to do so. Yet it was very easy to do so via digital broadcasting. There was a good case for public broadcasting to include the regional services on a digital platform, and there were convincing business cases for the commercial players to move over. All that was needed was the go ahead.

This was a perfect example of convergence because video on a 3G phone was provided via a telecommunications network, and was costly to do so. DVBH on the other hand used a broadcast channel to deliver the service, and thus it would take only a fraction of the cost to deliver the service to a multitude of users. A British study had looked at using a mobile phone for delivery of audio and it found that the broadcast of the Breakfast Show for two hours a morning would cost ₤27 million, because each individual delivery package would have to go to each individual subscriber on a telecommunication network. It found however that the provision of the same service on a broadcast network would cost 65p.

Ms L Yengeni (ANC) asked Mr Petrick to indicate what he believed to be the current shortcomings within ICASA in general and, in particular, with regard to the issuing of licences.

Mr Petrick responded that he had many colleagues and friends at ICASA, and he was thus unable to answer that question. He was of the view that far too much time was spent on licenses that could be granted fairly easily. Tremendous progress had been made with regard to community broadcast licences, empowering communities and ensuring that the station was managed and owned by the community. This process could however be made much faster. The main reason to his mind for this problem was the lack of resources within ICASA, as its broadcast division was struggling with applications received. He believed that if an applicant signed the code of conduct and could verify the ownership and control of a broadcast service, then authorisation to broadcast should be granted.

Ms Yengeni asked Mr Petrick what he believed to be the successes of ICASA. Mr Petrick replied that much had happened over the last ten years with regard to broadening ownership and control, broadcast services both in the commercial and community arena and the leveling of the playing fields for accessing broadcast licences. He stated that South Africa saw and heard many more voices today than it did ten years ago, and ICASA deserved credit for this.

Ms Yengeni asked Mr Petrick to explain his understanding of the independence of ICASA. Mr Petrick responded that this pertinent question would probably be considered in detail by the Committee when processing the Convergence Bill. The Minister of Communications had to perform a ‘very tricky balancing act’ because, on the one hand, she was responsible for managed liberalisation. Under the Telecommunications Act, ICASA could not currently issue requests for invitations, and on the other hand the Minister was also responsible for a number of portfolio organisations that lobbied the Minister extensively as a shareholder. This balancing act resulted in nervousness amongst foreign investors. He stated that greater separation of these powers of the Minister was needed. Nothing however prevented the Minister from raising a complaint and urging this Committee to hold ICASA to account, and perhaps this needed to happen more often.

The Minister was clearly responsible for policy creation whereas ICASA was responsible for implementing that policy, and that distinction must be maintained. There was however uncertainty as to whether this regime was maintained in the Convergence Bill. He believed that it was important for ICASA to act independently as this secured confidence from external investors.

Ms Yengeni asked whether Mr Petrick had any experience in interacting with black communities. Mr Petrick replied that although he came from a privileged background, it was only when he worked as an ICASA councillor that he experienced and enjoyed diverse cultural exchanges. He had interacted with communities in his area of influence and participated in roadshows.

Ms Yengeni asked Mr Petrick to explain his understanding of transformation in the telecommunication industry, and whether he believed it had been done satisfactorily. Mr Petrick responded that he had been following the ICT Charter and was pleased by the progress made in that area. He strongly supported the progress made by ICASA with regard to licence conditions and ownership and control, and believed that more was needed especially with regard to empowering people at grassroots level.

Mr M Mohlalonga (ANC) asked whether Mr Petrick believed that the staff of ICASA themselves should be able to nominate appointments to ICASA’s board. Mr Petrick replied that an ICASA councillor found her/himself in an unusual predicament of being in the office each day but essentially being non-executive. This brought challenges of not interfering with the actual operations of the institution. This role thus needed to be balanced carefully. He understood that every person in South Africa could nominate any individual to serve on the council, and it was then up to this Committee to evaluate the candidates.

Mr Mohlalonga stated that Mr Petrick’s CV indicated that he had been an acting CEO of ICASA, and asked whether this was legal. Mr Petrick responded that this had occurred in May 2004 when the then acting CEO tendered her resignation, although recruitment for a new CEO was well advanced, the ICASA council was not able to appoint a CEO at that stage. Council then decided to appoint him as acting CEO at that stage, and he served for two months. He stated that he did not believe there was any conflict of interest at the time, as it was to the benefit of the organisation. It was also important to note that ICASA received an unqualified audit during that time, and Mr Petrick himself signed off on those financials. The Office of the Auditor-General found no problem with his role as acting CEO.

Mr Mohlalonga asked whether Mr Petrick’s statement that ICASA should be held more accountable to this Committee implied that the Committee and not the Minister should have veto powers over the regulations issued by ICASA.

Mr Petrick replied that he understood the enabling legislation to mean that ICASA in fact had the power to issue invitations for broadcasting as well as the issuing of the licence, and the Minister did not have the veto in this regard. This was however slightly different with regard to telecommunication because of the process of managed liberalisation. This independence must be enshrined. Greater interactivity between the Department of Communications and ICASA was necessary.

Mr Mohlalonga asked Mr Petrick to indicate steps that could be taken to reduce Telkom’s high prices to ensure that telecommunication services were provided to all people. Furthermore, he asked Mr Petrick to explain whether he was satisfied with the extent to which the Public Broadcaster pursued its public mandate.

Mr Petrick responded that accessibility remained a problem especially in the deepest rural areas. He stated that he could not see a telecommunication operator or a Second National Operator (SNO) providing a service in such areas because it was not commercially attractive. The issue of access was not limited to charges alone, but dealt more specifically with the grassroots level and whether such people could be supplied with a telecommunications network. Clearly the licencing of more operators would improve access, especially in the metropolitan areas. Yet the issue of access proved a constant challenge and the best way to address it would be via a review of licence conditions and the establishment of tele-centres.

There had been much focus in the media on the dominance of American television programmes, and whether the public broadcaster had become a slave of the commercial powers rather than the public mandate. He stated that he would like to see much more public participation in decision-making about the SABC, its accountability to the public as well as the content of public interest programmes.

The meeting was adjourned.