1. PAKAMILE PONGWANA South Africa’s International and National Competitiveness 3-4 February 2015

2. 2 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 How far have we come? 1994 – 2015 Milestones [ Fixed Market] Before 1994: only one fixed line operator Less than 4 million lines in operation 2015: 4 mobile operators covering more than 99% of the population Over 100 fixed line service providers Fixed line use has stagnated

3. 1994 – 2014 Milestones [Mobile] South Africa has moved from 2 Mobile Network Operators (Telecommunications Act) 4 MNOs by 2012 (ECA), where the limit is governed by available spectrum The mobile data market is a growing market, with growth rate reported at XXX % in 2014? Universal Service: 99% population coverage for mobile voice services 48 th in the world according to the WEF Termination rates: Down from R 1.25 in 2009 to R 0.20 in 2014 – 84% reduction Retail prices: 2002: 2015: 3 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 How far have we come? South Africa has moved from 2 Mobile Network Operators (Telecommunications Act) 4 MNOs by 2012 (ECA), where the limit is governed by available spectrum Universal Service: 99% population coverage for mobile voice services Estimated 60 million unique SIM subscribers 48 th in the world according to the WEF Demand for data exploding: 80% growth for Vodacom in 2014 Forecast mobile data growth at a compound annual rate of 53% by 2018 (Cisco). Termination rates: Down from R 1.25 in 2009 to R 0.20 in 2014 – 84% reduction Retail prices: 2005: Approx. R 3.20 2014: Approx. R 0.60 (reduction of 81%)

4. 4 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 How far have we come? 1994 – 2014 Milestones [ Broadcasting ] 1994: one free to air broadcaster (SABC) One subscription service (Mnet) Limited commercial & radio stations 2015: A total of 255 Broadcasting Sound (Radio) licensees, whilst there are 12 Broadcasting Television licensees.

5. 5 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 How far have we come? International infrastructure 1994: 1 cable Telkom controlled 2015: 6 cables multiple owners

6. 6 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 How far have we come? 2015 Local Infrastructure: National connectivity: Telkom: 140,000 km Neotel/BBInfraco: 10,000 km Fibreco: approx. 2,000 km Vodacom/MTN/Neotel: 5,000 km Local Access Fixed Line: approx. 4 million copper lines fixed wireless in major centres Mobile:

7. So 7 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and c Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 International competitiveness Where does South Africa stand: ICTs are the driver of GDP in the future SA GDP ranking is 33 rd in the world This will fall if we are unable to leverage and enable internet deployment and use

8. 8 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 Internet competitiveness SA is ranked 58 th of 117 countries by OOKLA SA has lowest top city high speed connection speed of BRICS nations SA is ranked 73 rd according to WEF

9. 1994 – 2014 Milestones [Mobile] South Africa has moved from 2 Mobile Network Operators (Telecommunications Act) 4 MNOs by 2012 (ECA), where the limit is governed by available spectrum The mobile data market is a growing market, with growth rate reported at XXX % in 2014? Universal Service: 99% population coverage for mobile voice services 48 th in the world according to the WEF Termination rates: Down from R 1.25 in 2009 to R 0.20 in 2014 – 84% reduction Retail prices: 2002: 2015: 9 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 Contribution to employment Total of 32 445 employees (June 2014) 36% of workforce is female

10. 10 Policy Considerations for Convergence Content Mobile Networks Fixed Networks Broadcasters Internet Social applications – WhatsApp videos Access Avenues Child Safety Local Content Policy Issues Competition

11. 11 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 Constraints Human capital and innovation- Shortage of engineers and skilled workers Power supply Current mobile retail prices are dependent on current electricity prices and supply from Eskom Forced use of generators will increase costs Spectrum delays in Digital Migration policy and Policy on High Demand spectrum Rights of Way – municipalities prevent licensees from deploying infrastructure Regulatory delays – lack of funding and adequate technical skills leads to long lead- times and reliance on consultants to conclude regulation-making

12. 12 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 Opportunities Network deployment: Rights of Way – constitutional court recently ruled in licensees’ favour on the right to access and deploy infrastructure Job creation: Construction and electro-technical skills in deployment of networks High demand for: Technical skills for repair and maintenance of networks “low current” electrical as well as spectrum management engineers South Africa could drive regional internet penetration and global access to the internet with partnerships with our neighbours: Cost-based access to under-sea cables Cost-based access to long-distance backhaul services

13. 13 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 Catch up Policy co-ordination Conclude ICT Policy Review collectively Review institutional make-up Release spectrum policy Broadband Internet 4G Release of spectrum Fast-track digital migration Subsidise digital televisions remove encryption Resolve funding challenges for: ICASA SABC SAPO

14. 14 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 Catch up Policy co-ordination Conclude ICT Policy Review collectively Review institutional make-up Release spectrum policy Broadband Internet 4G Release of spectrum Fast-track digital migration Subsidise digital televisions remove encryption Resolve funding challenges for: ICASA SABC SAPO

15. 15 Strategic Outcome Oriented Goals (SOOGs) of ICASA N Promote the Digital Agenda * Facilitate nation- wide broadband penetration by 2020 * Promote the development of public, community and commercial broadcasting services in the context of digital migration Promote Competition * Remove bottlenecks to competition * Ensure South African retail prices of ICT services fairly reflect costs * Ensure effective HDI/BEE participation in the sector Promote efficient use of spectrum and numbering resources * Establish innovative approaches to technology usage * Support the rapid uptake of the new ICT technologies Protect Consumers * Promote consumer rights * Ensure universal service and access SOOG 1 SOOG 2 SOOG 3 SOOG 4 THANK YOU