ICASA chairperson Mothibi Ramusi. (Image source: ICASA)
The Independent Communications Authority of South Africa (ICASA) wants to ensure its regulations are evidence-based, says chairperson Mothibi Ramusi.
This, amid the fresh round of scrutiny of the long-running issue of the cost to communicate in the country; costs which Ramusi said have not declined with the envisaged swiftness, based on observations.
ICASA has oversight of South Africa’s telecoms, broadcasting and postal services sectorsthrough regulation. It issues licences to service providers, monitors licensee compliance with rules and regulations, and must ensure the public has access to basic communication services at affordable prices.
Last week, the authority signalled plans to launch two market inquiries: the affordability of telecommunications services in SA and the impact of over-the-top (OTT) services on traditional licensees and the regulatory framework in SA.
The first inquiry looks at whether voice and broadband services are affordable, particularly for low-income households, rural communities, young people and informal-sector workers. It seeks to identify structural cost drivers, household expenditure impact and potential regulatory or market interventions.
The OTTs inquiry seeks to establish the impact of these services on licensees in the telecoms, broadcasting and postal sectors, zeroing in on international players such as Netflix and WhatsApp.
This week, ICASA also hosted a three-day Regulatory Sandbox Study Visit, bringing together national, regional and international regulatory partners to exchange practical knowledge and experiences on the design and implementation of regulatory sandboxes.
The study visit, said ICASA, was to allow it and its counterparts to share practical experiences and strengthen regulatory capacity by exploring different approaches that support responsible innovation across different jurisdictions.
ICASA’s new probe is linked to previous regulatory interventions. The regulator notes the inquiry is aligned with its previous market inquiries into data services, its role in monitoring pricing outcomes following the “historic” spectrum auction, as well as previous pro-competitive interventions.
The inquiry runs parallel with the Department of Communications and Digital Technologies’ request for proposal to assess the cost to communicate.
Mothibi says there have been several structural changes in the sector that ICASA regulates; for example, banks are participating in the mobile virtual network operator (MVNO) space.
This, he adds, is a model the authority has embraced.
“South Africans are asking: ‘Why does it appear that MVNO service offerings are cheaper than traditional MNOs?’ This behaviour necessitates us to be proactive, observe the emerging trends and emerging restructuring of the sectors…engage with an intention of looking at the various elements seen in the environment that we’ve been regulating over the years.
“When we licensed the mobile network operators (MNOs) 25 years ago, at the time, an MNO was the provider of almost everything. With time, other services are being provided by vertical sector members − fintechs being an example. The same operators now also provide over and above what one would have thought to be their primary offerings.
“Our mandate says we regulate for public interest. At the centre is making sure subscribers are continuously protected and empowered. Business must not find itself challenged in extending its services, but adding margins because where they buy services is very expensive.
“As an authority, we went back and said given that we are seeing all these cross-cutting sectors, let’s engage South Africans and begin to understand the behaviour of these changes. Are they contributing to a further reduction, or is there an indirect escalation of cost?
“While we embrace change and the introduction of new services, we should not be fooled that some of these might…introduce additional costs to our subscribers somewhere.
“With this inquiry, we’re saying to South Africans we’re looking at the whole value chain, from procuring services, whether it’s telecoms, broadcasting or postal. To what extent can we, as an authority, unpack elements that seem to introduce additional costs?”
The chairperson comments that Statistics South Africa shows varying levels of affordability for a person in a village versus a person in town.
“As a regulator, we also need to then factor in our environment to see how best we can meet everyone halfway. Affordability is not just about me and you buying data to watch Netflix or MultiChoice, or purchasing something on an e-commerce platform…it’s whether the person buying services is able to afford them.”
According to Mothibi, the regulator wants regulations that are informed and tested, to eliminate the back-and-forth process of going to the courts.
Additionally, the process aims to educate South Africans to know their rights and what constitutes affordability in what they consume.
Turning to the OTT inquiry, he notes it’s a global issue to determine the extent of the impact these services have on data consumers.
“We’re doing the inquiry because we are mindful of the fact that we come from a traditional world where one could say services were provided in a siloed manner.
“The current and the future say we are talking of multiple applications that require to be transported on infrastructure. What does the consolidation of infrastructure mean to the regulator when it comes to people that consume?
“We want to understand, when we unpack this whole value chain, at what point can we say that OTTs are a burden or not to those that have already built networks, which is the first theme. The other thing with OTTs is to understand their operations.
“We need to understand because we don’t want to be in a regulatory environment where we regulate based on rumours because you’ll hear people saying, ‘people are not paying tax’.
“We want to make sure that when we engage there’s transparency, determine how to define an OTT service provider, do they pay taxes, what services do they provide, are their offices in South Africa, how do they employ local production houses, etc.”
