The Road to Convergence in South Africa

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Nov 6, 2013 (4 years and 1 month ago)

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The Road to Convergence






in South Africa



Councillor

Lumko

Mtimde

2
-
4

February

2006

Panos

Institute

West

Africa

(PIWA)

Workshop

Benin,

Cotonou

‹#›

‹#›

Disclaimer


Any views expressed in this presentation are those of the
individual presenter, except where the presenter
specifically states them to be the views of

ICASA. This
presentation may not be reproduced without the prior
written consent of the author and ICASA.


‹#›

‹#›

Overview

Introduction

Ten years of regulation

What is Convergence?

Conclusion

New Regulatory Framework

Impacts of Change on the Regulator

‹#›

‹#›

1. INTRODUCTION



The theme of this workshop is “Dialogue between
Telecoms and Media Regulation Stakeholders in
times of Convergence: Challenges and prospects for
Africa”.



This theme is relevant to me because,
in the famous
words of our esteemed President Thabo Mbeki, “I am
an African”

and I live in South Africa.



It is in this spirit that I would like to share with you our
experiences as an African state in dealing with the
forces of convergence and the impact that it has had
on our regulatory environment in South Africa.







‹#›

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INTRODUCTION (2)



The focus of this presentation is to provide you with
understanding of what is ICASA, what is convergence and
the new regulatory framework and future developments
that will impact on the communications sector in South
Africa.



The Independent Communications Authority of South
Africa ( “the Authority”) being a creature of statute operates
within a regulatory space wherein statutory instruments set
standards that govern the behaviour of all of those
involved in broadcasting and telecommunications.




These are framed around, the Constitution, Acts of
Parliament, and the National Government Policy
Directives. It is within this framework, that Position Papers
(Policy) and Regulations are drafted by the Authority and
license conditions are imposed on licensed operators
.


‹#›

‹#›

INTRODUCTION (3)


Policy and regulatory development by ICASA in the sector is
informed by, amongst others,
:




The

Constitution,

Act

108

of

1996

(as

amended)


Independent

Broadcasting

Authority

Act,

No
.

153

of

1993

(as

amended)


IBA’s

Triple

Inquiry

Report,

1995


White

Paper

on

Broadcasting

Policy,

1998


Broadcasting

Act,

No
.

4

of

1999

(as

amended)


Independent

Communications

Authority

of

South

Africa

Act,

No
.

13

of

2000

(as

amended)


Broad
-
Based

Black

Economic

Empowerment

Act,

No
.

53

of

2003


Telecommunications

Act,

No
.

103

of

1996

(as

amended)


Films and Publications Act, No 65 of 1996 (as amended)


Draft ICT BBEE Charter, 2005


Competition Act, No. 89 of 1998 (as amended)


Promotion of Administrative Justice Act (as amended)

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2. Ten years of regulation

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2.1

Timeline


Brief

timeline

of

communications

legislative

environment
:



Pre 1993


Regulated via the Apartheid’s Government Dept. of Posts
and Telecommunications, and the Dept. of Home Affairs.



1993

Independent Broadcasting Authority (IBA) Act established a
functionally independent and impartial regulator, the
IBA
, for
regulating broadcasting and signal distribution, in the public interest.


The Interim Constitution No. 200 of 1993 guaranteed this
independency.



1996


Telecommunications Act established the South African
Telecommunications Regulatory Authority (
SATRA
) to regulate
telecommunications in the public interest. Minister retained various
policy
-
making powers, more importantly certain licensing functions
and a veto power on all regulations.


Constitution Act No. 108 of 1996 re
-
enforced the IBA.


1999, enactment of the Broadcasting Act proving a new broadcasting
policy, after the White Paper (1998).



2000


Anticipating convergence of technologies the two regulators
were merged into a single regulator in terms of the Independent
Communications Authority of South Africa [ICASA] Act




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Timeline (1)


Prior

to

the

merger

/

establishment

of

ICASA

:


IBA and SATRA were mandated to form a Joint Technical
Committee, as a standing committee to deal with matters
relating to overlapping responsibilities.


Cabinet

decided

to

merge

IBA

and

SATRA


Convergence of technologies


Draft Bill was discussed and presented to Parliament


Merger

process


IBA and SATRA, together, formed established a process to
merge the two institutions.


ICASA

Act

was

enacted

in

2000
.

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Timeline (2)


The ICASA Act dealt only with the merger of the
organisational structure of the previous regulators.



The result was that although merged, ICASA was not
converged and managed two separate licensing
regimes one in terms of the IBA Act and
Broadcasting Act and the other in terms of the
Telecommunications Act
.



In respect of broadcasting matters, ICASA remained
functionally independent, in respect of its licensing
and regulatory powers,
whereas

in
telecommunications matters the Minister retained
some licensing powers and veto powers on
regulations developed by the Authority.


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2.2 ICASA Licensing Achievements


Telecommunications

Division


36

Private Telecommunication Network [
PTN
] licences
(Duration
-

10 years)


283

Value Added Network Service [
VANS
] licences
(Duration
-

10 years)


7

Universal Service Area Licences [
USALS
] (Duration
-

25 years)


3

Mobile Cellular Telecommunication Service [
MCTS
]
licences (Vodacom, MTN and Cell C) (Duration
-

15
years)


1

International Gateway and Multimedia licence
(Sentech) (Duration
-

15 years)


1

National Wireless Data Telecommunication Service
licence (Swiftnet) (Duration
-

10 years)


1

National Mobile Data Telecommunication Service
licence (WBS) (Duration
-

10 years)


2 National Public Switched Telecommunication Service
[
PSTS
] licenses (Telkom and SNO) (Duration 25 years)


‹#›

‹#›

ICASA Licensing Achievements (2)


Broadcasting

Division (Licensees)


Television


3

Public National Free
-
to
-
air Broadcasting Services (
SABC
)


1

Commercial National Free
-
to
-
air Broadcasting Service (
e
-
tv
)


1

Terrestrial Subscription Broadcasting Service (
M
-
net
)


1

Community Television Broadcasting Service (TBN, which
was grand
-
fathered) and (a few others from time to time on
special events licenses, Soweto, Grahamstown, Cape Town,
Durban)


2

Public Regional Television Broadcasting Services (
SABC



not operational yet)



In addition to these licenced services there are 2 satellite
based television broadcasting services (
Vivid and DsTV
)
which are not licensed yet, but which do have permission to
continue broadcasting until their applications have been dealt
with by the Authority.

‹#›

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ICASA Licensing Achievements (3)


Broadcasting

Division (Licensees)


Sound Broadcasting (Radio)


18

Public Sound Broadcasting Services


13

Commercial Free
-
to
-
air Sound Broadcasting Services


100

(82 are currently on air) Community Sound Broadcasting
Services



In addition there is 1 satellite based commercial sound
broadcasting service (
WorldSpace
) which has permission to
continue broadcasting until its application has been dealt with
by the Authority.



Broadcasting Signal Distribution


1

Category One Licence


Common Carrier (Sentech)


1

Category Two Licence


Commercial (Orbicom)


Some Community Sound Broadcasters are licensed to self
provide their own signal distribution as Category Three
Broadcasting Signal Distribution licences.






‹#›

‹#›

ICASA Licensing Achievements (4)


Engineering and Technology Division


5,507

Aeronautical Station Licences


6,359

Amateur station Licences


19,847
Examinations and certificates


68

Fixed Station Licences


45,195

Land Mobile station Licences


4,268

Maritime Licences


5,667

Radio Dealer Registration Certificates


24

Satellite Licences

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2.3 Changing Regulatory Framework


In 2005, the Minister of Communications
tabled two Bills in the National Assembly
aimed at changing the regulatory framework
to meet the needs of convergence.



The Convergence Bill [B09
-
2005] set out a
converged licensing framework and proposed
the repeal of the existing broadcasting and
telecommunications legislation. This Bill was
later renamed the
Electronic Communications
Bill.



The
ICASA Amendment Bill

[B32
-
2005] deals
with amending the functions and organisation of
the regulator, as well as introducing enforcement
and compliance structures to reflect
convergence between networks.


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3. What is Convergence?

‹#›

‹#›

3.1 Convergence Defined


Convergence means different things to different
people and there is no one accepted definition.



One of the main drivers for convergence appears to
be digital technology which is being utilised for the
reproduction, storage, and transmission of
information in all media



Essentially this means that any form of content,
whether it be still or moving pictures, sound, text or
data, can potentially be made available over any
communications platform. For example, currently it is
possible to receive radio and television over the
Internet, while digital television that is currently being
developed will have some of the capabilities normally
associated with personal computers.

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Convergence Defined (2)


Of course there are other drivers, amongst others,
the increased storage capacity of variety of
consumer access devices, increased usage of
internet protocol (IP) to facilitate seamless interaction
across a number of different networks, new
applications and the evolution of broadband
technologies.



Although there is no one universally accepted
definition, the International Telecommunications
Union (ITU) indicates that convergence can be
described as
“the provision of new services over
existing infrastructure, development of new types of
infrastructure, and the enhancement of existing
services and technologies to provide new
capabilities”
(ITU:1996).

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Convergence Defined (3)


The ITU also mention that it can also be defined as
“technological, market or legal/regulatory capability
to integrate across previously separated
technologies, markets or politically defined industry
structures”

(ITU:1996).



It was also raised by the ITU that convergence
involves a critical international component,
“as many
services and information sources that were
traditionally controlled on a domestic level are being
provided on a global basis”
(ITU:1996)
.


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Convergence Defined (4)


Mr. Leong Keng Thai, of the Infocomm Development
Authority (IDA) of Singapore, has suggested that it is
perhaps best to describe convergence as a
paradigm shift in the way we think about products
and services.



The traditional boundaries between industry sectors
such as film, music, publishing, broadcast television
and radio, telecommunications, computing and
service industries such as education and health are
being redefined or reorganised and new industry
boundaries are emerging. This means that products
are no longer distinct as belonging to a specific
industry or platform alone.

‹#›

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Convergence Defined (5)


It is better then in terms of convergence to view
products and services as part of a single value chain
that consists of


content


delivery mechanisms or conduits such as Asymmetric
Digital Subscriber Line (ADSL), satellite, cable; and


end user appliances or platforms such as television
sets, cellular phones, personal digital assistants,
home computers, etc.


Content


Delivery


Consumer


Access


Device

End

User

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3.2 Convergence in practice


It is critical to note that change is not uniform across
the information, communication and technology
sector (ICT), there are some areas that have hardly
been affected by convergence and others which are
in the process of rapid evolution to converged media.




This has prompted some to describe convergence as
a

“collection of separate trends which have the
ongoing effect of integrating technologies, networks,
content, gateways and markets both individually and
collectively”

(Henderson & Wijewardena).

‹#›

‹#›

Convergence in practice (2)


In

practice,

the

following

trends

have

been

identified
:



Network level technology convergence



changes in
underlying networks used to deliver services, e.g.
Internet Protocol (IP) networks providing services
which previously were delivered by circuit switched
networks;



Bundled convergence



collection of separate
services into a single retail bundle, e.g. bundling local,
long distance and internet services at cheaper rates;



Gateway convergence



evolution of new gateway or
access devices allowing consumers to access
different services through a single device, e.g. new
mobile phones that allow internet and voice services;



Service convergence



delivery of diverse services
through the same delivery medium or conduit, e.g.
single “pipe’ for voice, data, text and pictures;

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‹#›

Convergence in practice (3)


Substitutable service convergence


demand side
substitution between services, e.g. substitution of fixed
telephony services by mobile telephony;



New converged services


application of new
technology to invent completely new services capable
of being accessed by any access technology; and



Regulatory convergence


merging of industry
regulators into a single regulator and the liberalisation,
harmonisation or merging of communications
legislation.



In

South

Africa,

these

trends

are

being

observed,

but

they

are

at

different

levels

of

evolution

towards

convergence
.

‹#›

‹#›

Convergence in practice (4)


These

global

trends

would

appear

to

justify

new

regulatory

systems

being

formulated

in

order

to

reduce

obstacles

to

competitiveness
.




In

the

context

of

South

Africa

a

number

of

questions

were

asked

before

proceeding

to

change

the

regulatory

system
.

For

example,

have

markets

converged

sufficiently

to

justify

regulatory

change?




There

is

also

the

fact

to

consider

that

even

though

technologies

are

converging,

this

does

not

mean

that

the

markets

that

utilise

these

technologies

have

become

indistinguishable
.

Practically

all

broadcast

entertainment

and

information

services

still

fall

into

the

realm

of

television

and

radio

in

South

Africa
.

It

will

also

take

some

time

before

computers

or

personal

mobile

devices

will

be

capable

of

receiving

high

quality

audio
-
visual

material

via

the

Internet
.


‹#›

‹#›

Convergence in practice (5)


However,

it

is

also

clear

that

convergence

is

blurring

distinctions

and

raising

questions

as

to

what

is

the

best

regulatory

framework

to

address

the

new

environment

that

is

coming

into

being
.


When

services

were

distinct

(telephony,

broadcasting

and

online

computing)

and

they

operated

on

different

networks

with

different

platforms

(telephones,

TV

sets

and

computers)

each

was

regulated

by

a

different

regulatory

framework

(Illustrative

diagram

on

next

slide)
.


Convergence

places

pressure

on

existing

regulatory

regimes

by

highlighting

the

differences

in

regulatory

requirements

between

converging

sectors
.

‹#›

‹#›

Traditional Structure now Converging

Source: Lotus Development (an IBM Company)

‹#›

‹#›

Convergence in practice (6)


Recent

developments

in

Broadband

(e
.
g
.

WiMax

with

speeds

of

up

to

25

Mbps)

which

has

the

ability

to

provide

a

multiplicity

of

services,

whether

data,

voice

or

video,

at

any

speed,

which

is

likely

to

be

a

major

determinant

of

cost

is

an

example

of

converged

services,

or

what

the

communications

industry

calls

Triple

Play
,

or

the

delivery

of

voice,

video

and

data

to

residences

over

a

single

line
.




The

illustrative

diagram

on

the

next

page

demonstrates

why

converged

services

do

not

fit

within

the

traditional

distinct

structures

indicated

in

the

previous

diagram
.


‹#›

‹#›

Example of a Triple Play ADSL or Fibre Broadband Network
delivering voice, data and video to the home

‹#›

‹#›

4.

NEW REGULATORY FRAMEWORK

‹#›

‹#›

4.1 Electronic Communications Bill


The

most

fundamental

impacts

of

the

Electronic

Communications

Act

(ECA)

once

it

commences

will

be

the
:


repeal of the Telecommunications Act and the Independent
Broadcasting Authority Act and the substantial amendment of
the Broadcasting Act;


Convergence of Telecommunication and Broadcasting
regulation making processes into one process, in terms of
the ECA


Replacement of the existing telecommunications and
broadcasting licensing frameworks with a single licensing
regime;


Enhancement of the Authority's competition powers in terms
of dispute settlement and significant market power
determinations; and


Setting of specific timelines for transition which the Authority
must comply with.

‹#›

‹#›

4.2 ICASA Amendment Bill




The most fundamental impacts of the ICASA Amendment Act
once it commences will be that the:


Functions and staff of the postal regulator are incorporated into
ICASA;


The structure and functioning of the ICASA Council is reviewed,
for example,



the number of Councillors to be increases from 7 to 9;


Inquiry processes for telecommunications and broadcasting are
converged into one process;


Council appointment and performance management process now
are the responsibility of the Minister
;


Telecommunications and broadcasting complaints hearing and
enforcement functions and processes now reside within a single
body, namely the Complaints and Compliance Committee (CCC);
and


Powers and functions of inspectors are increased and functions
clarified.


ICASA has objected to some possible unconstitutional
provisions of this Bill but Parliament approved it, we await the
President’s guidance
.


‹#›

‹#›

4.3 What guidance is provided?


The

new

and

amended

legislation

provided

guidance

in

relation

to
:


Strategic Policy


Market Analysis


Competition


Content (Triple
-
Play)


Technology


Operational Policy


Regulations


Licensing


Numbering


Compliance and Enforcement


Frequency


Type Approval and Standards


‹#›

‹#›

4.4 New Approach to licensing


All

licences

are

now

divided

into

Individual,

Class

or

Exempt
.




An

Individual

licence

is

a

licence

which

is

customised

in

terms

of

its

licence

conditions

to

be

specific

to

the

applicant

being

licensed
.



A

Class

licence

can

be

described

as

an

“out

of

the

box”

licence,

it

involves

no

more

than

a

registration

process

of

60

days
.



Exempt

means

exempt

from

having

to

apply

for

a

licence

or

register,

but

does

not

necessarily

exclude

such

an

operator

from

the

general

provisions

of

the

Act

once

it

commences
.



‹#›

‹#›

Authority may grant





individual & class licences

Generic provisions of the Bill apply to all relevant activities

Standard licence conditions common

to Individual and Class licenses

Standard Licence

Conditions common

to Individual Licenses

Special conditions

Undertakings

Individual

Class

Exempt

‹#›

‹#›

New Approach to licensing (2)


The

Act,

once

it

commences,

creates

four

markets

or

licensable

activities

within

the

ambit

of

Individual

and

Class

licenses
.


The

licensable

activities

are
:


Electronic Communication Network Services


Electronic Communication Services


Broadcasting Services


Radio Frequency Spectrum.


The

diagrams

which

follow

illustrate

the

four

licences

and

their

relationship

to

Individual,

Class

and

Exempt,

as

well

as

providing

some

examples

of

their

operation,

as

provided

by

the

Act

once

it

commences
.





‹#›

‹#›

Authority may grant





individual & class licences (2)

Radio Frequency Spectrum

Broadcasting Services

Communication Services

Communication Network Services

Individual

Class

Exempt

Licensed

Unlicensed

4 licensable activities or markets

‹#›

‹#›

LICENCE

CATEGORY

INDIVIDUAL

(Apply

for

individual

licence)

CLASS

(Register

for

class

licence)

EXEMPT

Electronic

Communications

Network

Services



Electronic

Communication

Networks

of

provincial

and

national

scope

operated

for

commercial

purposes
;




any

Electronic

Communication

Network

Services

where

a

state

entity

(directly

or

indirectly)

holds

an

ownership

interest

of

greater

than

25
%

of

the

share

capital

of

the

person

providing

the

service
;



Any

other

Electronic

Communications

Network

Service

as

may

be

prescribed

that

the

Authority

finds

has

significant

impact

on

socio
-
economic

development



Communication

networks

of

district

municipality

or

local

municipal

scope

operated

for

commercial

purposes



Any

other

service

as

may

be

prescribed

where

the

Authority

finds

that

it

does

not

have

significant

impact

on

socio
-
economic

development




As

prescribed

by

the

Authority,

but

may

include
:



private

communications

networks,

except

where

additional

capacity

is

resold



small

communications

networks

such

as

local

area

networks

Electronic

Communication

Services



Electronic

Communication

Services

consisting

of

voice

telephony

utilising

numbers

from

the

national

numbering

plan


Any

other

Electronic

Communications

Services

as

may

be

prescribed

that

the

Authority

finds

has

significant

impact

on

socio
-
economic

development




Any

service

as

may

be

prescribed

where

the

Authority

finds

that

it

does

not

have

significant

impact

on

socio
-
economic

development



As

prescribed

by

the

Authority,

but

may

include
:


Electronic

Communications

Services

provided

on

a

not
-
for
-
profit

basis


Electronic

Communications

Services

that

are

provided

by

resellers

Broadcasting

Services



Commercial

broadcasting

and

public

broadcasting

of

national

and

regional

scope

whether

provided

free
-
to
-
air

or

by

subscription



Any

other

broadcasting

service

as

may

be

prescribed

that

the

Authority

has

significant

impact

on

socio
-
economic

development



Community

broadcasting

and

low

power

services

whether

provided

free
-
to
-
air

or

by

subscription



Any

service

as

may

be

prescribed

where

the

Authority

finds

that

it

does

not

have

significant

impact

on

socio
-
economic

development



As

prescribed

by

the

Authority

Radio

Frequency

Spectrum



Where

the

provision

of

the

above

services

entails

the

use

of

radio

frequency

spectrum



Where

the

provision

of

the

above

services

entails

the

use

of

radio

frequency

spectrum



As

prescribed

by

the

Authority,

may

include
:



uses

that

were

allowed

previously

without

a

licence

and

uses

that

do

not

cause

harmful

interference

‹#›

‹#›

New Approach to licensing (3)

Terms

and

conditions



The

ECA

provides

that

the

Authority

shall

prescribe

standard

terms

and

conditions

to

be

applied

to

individual

and

class

licences


A

list

is

provided

of

standard

terms

and

conditions

which

the

Authority

may

take

into

account

in

Chapter

3
,

e
.
g
.

licence

area,

duration,

public

interest



The

Authority

may

impose

additional

obligations

on

any

individual

or

class

licence

in

accordance

with

Chapter

10

(Competition

Matters)

and

universal

service

and

universal

access
.



‹#›

‹#›

New Approach to Licensing (4)

Licence

periods



Individual

licences

may

be

issued

for

a

period

of

20

years,

unless

a

shorter

period

is

requested

by

the

applicant

or

designated

by

the

Authority



Class

licences

may

be

issued

for

a

period

of

10

years

unless

the

Authority

indicates

to

the

contrary

‹#›

‹#›

New Approach to Licensing (5)

Licensing

Regulations



The

Bill

provides

that

the

Authority

shall

prescribe

regulations

for

licences

and

may

precribe

different

regulations

for

different

types

of

individual

and

class

licences
.



‹#›

‹#›

5. Impacts of Change on the Regulator

‹#›

‹#›

5.1

Structural Impacts




The commencement of the Electronic Communications
Act and the ICASA Amendment Act will result in an
increase in functions of the Authority, in the areas of
investigation, inspection, complaints handling, dispute
resolution, adjudication, regulation, and conduct of
market review studies.



This will require the Authority to restructure itself
internally, to deliver on the new requirements, as well as
introduce new regulations to support the ECA and
ICASA Amendment Act’s provisions.



Restructuring will have a number of budgetary
implications.

‹#›

‹#›

5.2 Transitional Provisions


All

current

issued

licences

remain

valid

until

converted

and

all

services

that

did

not

previously

require

a

licence

have

a

deemed

licence

exemption

until

notified

by

the

Authority

that

a

licence

is

required
.



Existing

licences

must

be

converted

within

24

months

of

the

ECA

commencing,

and

any

extension

period

to

this

may

not

exceed

6

months
.



Any

current

applications,

process,

recommendations

pending

before

the

ECA

came

into

force

will

be

considered

as

if

submitted

in

accordance

with

the

ECA
.

‹#›

‹#›

Transitional Provisions (2)


Within

30

days

of

the

ECA

commencing,

the

Authority

must

gazette

a

schedule

in

terms

of

which

it

intends

undertaking

the

licence

conversion

process
.



The

notice

must
:


Identify the holders of existing licences and nature of
existing licence


Set out a time frame for conversion including time
frame for granting new licences


Set out the form and content and information that
must be provided to the Authority by existing licensees
to assist the conversion process

‹#›

‹#›

Transitional Provisions (3)


Set out the process the Authority plans to undertake in
converting existing licences, and


Confirm the rights of applicants to participate in such
process.



Separate

licences

will

be

issued

where

the

existing

licence

spans

categories

set

out

in

chapter

3

of

ECA
.



The

Authority

may

not

grant

or

include

in

any

licence

converted

any

monopoly

or

exclusionary

rights

in

any

network

or

service

and

any

such

rights

that

exist

by

virtue

of

IBA

Act,

Sentech

Act

or

Telecommunications

Act

are

null

and

void
.

Radio

Frequency

spectrum

assigned

to

licence

holder

is

not

viewed

as

being

monopoly

or

exclusionary

rights
.


‹#›

‹#›

Transitional Provisions (4)


Within

24

months

of

ECA

coming

into

force

current

regulations

must

be

repealed

or

amended,

however

they

will

remain

in

force

until

repealed

or

amended
.

‹#›

‹#›

Concluding Remarks


ICASA will now oversee a new market structure under
a converged environment.


The
organisational

set up will change.

I thank you

Lumko Mtimde

Councillor, ICASA

www.icasa.org.za


03 February 2006