Broadcasting Digital Migration Policy; Undersea Cables: Department briefing

Meeting report

Department of Communication (DoC) on Broadcasting Digital Migration Policy
Mr Themba Phiri (Director: Policy & Regulatory Impact Assessment – DoC) provided an outline of the concept of broadcasting migration, essentially the conversion of television transmission signals from analogue to digital which would put South Africa on par with other countries. He stated that an agency (Digital Dzonga) had been created to deal with BDM matters. He outlined  the department's strategy in meeting the desired outcomes and policy objectives. He explained why it was necessary to switch from analogue to digital migration and the key policy proposals and outcomes of the switch. The digital signal would be switched on in November 2008 and that the analogue signal would be switched off in November 2011, providing a period of dual illumination to allow citizens time to switch. He outlined the need for Set-Top Boxes (STBs) that would convert the digital signal to allow for reception on older analogue television sets. He discussed the position that the DoC held about STB manufacturing and subsidisation, which focused on utilising local manufacturing capabilities and potentially making allowance for subsidisation of STBs to the poor.

Discussion
Ms S Vos (IFP) stated that the report said that STBs would be sourced primarily from South African manufacturers caused her concern. The industry was huge and she asked asked if he was considering a new separate industry or piggybacking STBs on top of existing manufacturers. She asked if the technology involved was new. In terms of interoperability, she asked what the relation to DSTV boxes was and what the implication for existing manufacturers was. On Digital Content Generation Hubs, she asked whether they had studios in mind and how they intended to fund this. Finally had they identified regulatory changes and what were these?

Mr Phiri replied that they were developing specifications for STBs and that the box was not similar to DSTV boxes. He added that they were trying to create common specifications that could be manufactured by any manufacturer, Specifications were at an advanced level and were being developed jointly by ICASA and SABS and should be available in March. He added that there were certain developmental areas that broadcasters should cater for and that ICASA would manage this.

Mr P Swart (DA) asked who comprised the Digital Dzonga body and what the cost of the cheaper STBs would be.

Ms D Smuts (DA) asked whether Sentech had the money that it needed, as approximately R500 million had been given to them and reminded the DoC that it planned to roll out services to metropolitan areas this year. With regard to STBs she stated that no communication on this issue had been made to the public and that they needed to be advised on what they should be buying. She understood that they were still waiting for a decision on subsidisation and asked whether or not subsidisation was going ahead. She asked about how High Definition television (HDTV) related to Digital Television Transmission (DTT). Ms Smuts asked who took these decisions.

Mr R Pieterse (ANC) asked whether they were looking at STB subsidisation and asked about the potential for foreign countries to usurp the STB market by providing cheaper products. He voiced his concern that rural areas would be neglected in the roll-out and that they should not give cities preference. He reiterated the need to make consumers aware and that a campaign was necessary. He asked who ensured STB specifications and if they existed as manufacturers needed to be informed about this.

Mr Phiri replied that it was true that there was a margin of people that it was difficult to cater for, but added that policy made allowance for a hybrid rural-metropolitan model and noted Mr Pieterse’s suggestion for such a hybrid model. He added that they were trying to achieve interoperability in order to prevent consumers from having to buy a whole host of STBs. He acknowledged the challenge of managing conditional access and stated that operators needed to come together to agree on this. This still needed to be determined, but conditional access would ensure that STBs could not be used elsewhere. Subsidies were being strategised and considered and that inter-departmental considerations were being made including the Department of Trade and Industry (DTI), National Treasury and the DoC. He agreed that STBs needed to be manufactured locally to mitigate a huge foreign influx; local capacity was sufficient in his opinion.

Ms Vos asked about patents and whether the technology was new and if so, who would own the intellectual property rights.

The Chairperson asked for an explanation of where the Director General was and whether or not there was a policy in existence. He questioned how they planned to implement the migration in eight months without a policy in place. He asked whether finances were in place.

Mr Pieterse commented that in order to achieve something, a build-up was needed and that they should specify time frames for targets. He asked whether future MNET or DSTV decoders would include STB functions.

Mr K Khumalo (ANC) asked who constituted the team that worked on the policy and how often did they meet. He questioned whether they would be able to meet all the requirements by November. He asked whether the STB was equivalent to a decoder. He stressed that there needed to be clarity on interchange. He added that in future he wished that the DoC provided a full delegation.

Ms L Yengeni (ANC) asked what they meant by the statement that STBs were being developed and asked by whom, as well as who owned the intellectual property rights.

Mr Phiri replied that in South Africa they had adopted the Ampek 4 standard of digital transmission, and that it was a new, more expensive standard, but that it had significant benefits despite the higher cost. Digital Dzonga was a public entity that represented industry, the public and government and that it would report to the Minister.

The Chairperson asked who was actually in the Digital Dzonga, as he was under the impression that only the Chairperson had been elected.

Ms Mashile Matlala, Senior Manager for Telecommunications Policy, replied that they had not been appointed yet due to the need for endorsement by the Department of Public Enterprises in order to ensure that finances would be in order. She added that the process to select members was via public nomination.

Mr P Swart (DA) asked whether the lack of a functioning Digital Dzonga would impede meeting the November deadline.

Mr Phiri replied that it would not and that they were unrelated.

Ms Smuts asked who dealt with the assigning of frequencies.

Mr Phiri replied that it was the mandate of ICASA. He added that policy was in place and that it would be gazetted the following week. Delay was due the DoC’s consultation process taking longer than expected. Mr Phiri stated that he felt that industry would understand. He replied that without a subsidy, the manufacturer would own the design and that with a government subsidy the generic interoperable design would be owned by government.

Mr Kgotso asked who stood to benefit from the process, as it appeared that the DoC had gone beyond its mandate of developing policy. He added that type approval needed to be located within another body.

Mr S Kholwane (ANC) asked whether a process of consultation with previously disadvantaged role-players had been done to ensure inclusion.

Mr Khumalo reiterated the question of whether the DoC was ready. He asked what the nature of a dzonga was, as he was unfamiliar with dzongas. He added that in Kwazulu Natal a donga was a hole in the road, but that he had never come across a dzonga yet.

Mr R Padayachie (Deputy Minister of Communications) said that the factories that manufacture the DSTV decoders  would manufacture the set-up boxes. The majority of these factories are white owned, but these entities would work closely with the three black-owned factories in this market. The department  would look at the issue of subsidies and that universal access to all South Africans are a top priority. He said that South Africans earning between R1 000-R2 700  would be the group that would qualify for subsidies if they are instituted. The cheapest set-up box would cost an estimated R400, with the option to improve on the features later. South Africa has the capability as proven with the recent digital broadcasting of the game between Ghana and Brazil and that the required deadlines would be met. At the recent Digital Migration Conference, regional capacity was discussed and African countries were looking towards South Africa for leadership and assistance.
 
Mr Padayachie said that the STBs should also have the ability to be improved. At the heart of the STB industry, it was an assembly line for imported components and that this was the unfortunate reality. The scale of the industry would increase, especially as South Africa was obligated to provide the SADC region with STBs for their own purposes. Once gazetted, they could call industry to the party. This needed to be done now and he admitted that the DoC had been slow with the implementation of the Digital Dzonga. He explained the primary function of the Digital Dzonga would be to monitor and implement policies as well as provide an awareness campaign.

Mr Kgotso asked who would pay for the cost of aerials if they were needed.

Mr Pieterse asked whether they would actually have enough electricity for manufacturers. He questioned why one needed to have different models when the STB was tasked with decoding digital signals so they could be viewed on analogue television sets. The Dzonga could not be an agency as the DoC did not have licence to create agencies, it was therefore a committee.

Mr Swart stated that he thought the DoC understood the Committee’s concerns and added that they knew how these processes actually turned out. In line with this he questioned whether the policy would actually be gazetted next week. He stressed the need for progress reports.

Ms Vos asked when the sale of old incompatible television sets would be halted, as the market was currently being flooded with products that would shortly be incompatible.

Ms Yengeni said that the Committee needed a report in black and white that stated the readiness of the migration programme.

The Chairperson stated that the DoC briefing was unsatisfactory, adding that the Committee viewed the issue at hand as of paramount importance. They needed a clear policy framework and that it should be available by next week at the latest. The Committee required a clear implementation strategy and a report from ICASA. He stated that they would need to provide a comprehensive report within four weeks.

Policy Guidelines on the rapid deployment of electronic communication facilities
Ms Mashile Matlala, Senior Manager for Telecommunications Policy, gave an overview of how government was going to deal with the processes involved with rapid deployment of electronic communications facilities. She emphasized the major policy factors in the world in relation to electronic communications facilities.

She explained that the Minister had the power to grant permits and licences to entities wishing to construct undersea cables. Ms Mathlala outlined the key provisions of the guidelines put in place to address the construction and implementation of the undersea cables. The DoC had drafted new guidelines in terms of Chapter 4 of the Electronic Communications Act (ECA).
Chapter 4 was amended as they realised that they did not have legislation for the linking of cables. Currently they did not have comprehensive unified guidelines. The DoC did not opt for the issuing of separate licences and instead linked the actual cables, landing stations and international gateway components together under one uniform set of guidelines. The guidelines publication bill was delayed due to the need for alignment with the Department of Environmental Affairs and Tourism (DEAT) and the National Environmental Management Act (NEMA) legislation in order to create sector specific guidelines. Ms Matlala subsequently read through the Key Proposals.

Discussion
Ms D Smuts ( DA) said that it is important to scrutinise ownership and control it. She was sure that the DoC was getting into an unnecessary amount of complication by drafting new guidelines under Chapter 4, considering all the other parties involved. She added that Chapter 4 dealt primarily with municipal authority and jurisdiction to undertake the construction necessary to lay telecommunications lines. Now the DoC was affording this right to companies. By allowing the Minister to determine licensing, it appeared that the DoC was trying to create a role for the Minister to give authorisation in order to scrutinise adherence to African equity or ownership under the NEPAD broadband protocol. She asked why these hurdles were being instituted.

Mr Pieterse said that the Minister was also overseeing the NEPAD cable and responsible for the revocation of licences for other cable operators, this constituted a clear conflict of interest.

Mr Kgotso pointed out that it was a mistake that the Committee did not specify which part of the Undersea Cable issue they needed to be briefed on. An outline of the different cables under consideration was the real issue, not the guidelines.

The Chairperson interjected that the Committee should put forth their questions and if the delegation could not provide adequate answers, they would have to come back to the Committee.

Mr Kgotso asked what the relationship between NEPAD, Telkom and Infraco was. He stated that it seemed that the Department of Public Enterprises (DPE) was doing some of the work of the DoC. He questioned the role of the Minister in being in charge of landing rights. Mr Kgotso stated that even if published tomorrow, guidelines would have no force.

Ms Matlala replied that in terms of the ECA, gateway licences were automatically issued, if a company that did not posses a gateway licence needed to land a cable, they would partner with one that did, in this case a local partner.

The Chairperson asked what happened if these guidelines were contravened.

Ms Matlala replied that guidelines had the same force of law as policy directives.

Ms Smuts asked if they were section 3.

Ms Matlala replied that they were and stated that they had similar legal implication as policy directives.

In reply to Mr Pieterse asking if local meant African, Ms Matlala said that it did.

Mr Pieterse stated that landing rights were the real issue.

Mr Padayachie replied that the landing of cables in South African territory had security implications and that due to this, discretionary ministerial authority was being utilised.

Mr K Shongwe (Deputy Director General: ICT International Affairs and Trade - DoC) replied that the issue was that they could not be sure who was partnered with a specific company and that it had security implications, thus necessitating case by case consideration by the Minister.

Mr Swart stated that the Minister needed to be empowered by legislation to derive authorisation capability; he asked what the legislation was. He added that the Minister could only make regulations. He requested another meeting where they could properly address the issues at hand.

The Chairperson agreed and added that if the DoC was unclear about what they needed to present, they could phone the Committee. What was needed was a status report; he added that there was no clear sense of policy clarity.

Mr Kholwane said that if the DoC did not provide a proper presentation on the relevant material then they needed to be held accountable and not humoured. The DoC was undermining the Committee. He added that nothing could be done now, and that despite time constraints they needed to reconvene to discuss these issues.

Mr Swart added that the Director General needed to be present.

Mr Shongwe replied that the message was clear and asked if the committee wanted answers to their question now.

The Chairperson replied that they would re-schedule as the DoC delegation was not sufficiently prepared to answer their questions.

ICASA councillor appointment: approval
The Committee had provided two recommendations to the Minister who had selected Mr Refiloe Msiza. The Committee approved the final resolution on the selection of an ICASA councillor.

Committee Business
The Committee approved some minutes and discussed their committee programme.

The meeting was adjourned.