ANC warns against recklessness in setting policy for satellite broadband

The Independent Communications Authority of SA (Icasa) and the cabinet cannot be sidestepped in setting policy for satellite broadband, as this will open the government and the Chapter 9 institution to litigation by existing players, the ANC’s subcommittee chair on communication Nkenke Kekana said.

The ANC has urged caution as communication & digital technologies minister Solly Malatsi proceeds with a policy directive gazetted last week, which will open the way for equity-equivalent investment programmes to replace BBBEE for multinationals entering the satellite service space.

“There are jobs that would be on the line if we are reckless. The investment that is already on the ground would go on to create a wasteland of networks.

“In other words... current licensees need to be protected from new entrants. We need to take into consideration their interests, the interests of the consumer, the interests of businesses that are running on these networks,” Kekana told Business Day.

The directive culminated in Malatsi being brought before parliament’s portfolio committee on communications to explain himself on Tuesday, where parties across the board expressed their rejection, mostly of the procedure he followed in issuing the directive but also on the basis of perceptions that it was a haphazard move to benefit US billionaire Elon Musk’s Starlink.

Malatsi rejected the allegations in parliament and defended his position, arguing that he was simply seeking to “align regulations” across the ICT sector.

But according to Kekana, former communications minister Khumbudzo Ntshavheni had issued a directive in 2022 requesting Icasa to conduct a market feasibility inquiry and develop a framework for licensing broadband satellite providers. Icasa is expected to conclude that study in the coming months.

Deputy president Paul Mashatile, in answering questions in the National Council of Provinces on Thursday, noted Malatsi’s envisaged plan to ease foreign investment in the telecommunications sector but suggested he was not following the correct channels in government. 

“We are waiting for the minister to come. Nothing will be changed unless cabinet decides it should be so,” he said.

The process, Kekana says, is not as simple as issuing a directive as there are already satellite service providers in the country.

Also, first-tier operators such as mobile operators have most of their licences coming up for renewal in about 2028 and 2029, and that means whatever new policy is put in place now will affect existing players when their licences are being renewed in two years’ time.

“The SA economy is running on these networks as we speak. So [with] any new entrant, there has to be symmetry [and] there has to be fairness. We need to consider the investments that are already existing in the country.

“Why do we do so? It’s more than sovereignty, it’s actually protecting the economy of SA. Because the other players will think it’s unfair. In fact, they will win in court,” Kekana added. 

Crucially, Kekana said the Electronic Communications Act (ECA) explicitly stated that ministerial policy directives could only be gazetted after the cabinet had discussed and approved the move, and that that had not been done in this case.

In an interview on Tuesday, Malatsi said the cabinet had approved the medium-term development plan, which included making provision for equity equivalents more broadly in the information and communication technology (ICT) sector, which he repeated to parliamentarians later on.

However, Business Day understands that cabinet sign-off was not obtained for the policy directives issued last week.

Kekana said it was crucial that SA remain committed to its “technology neutral” stance. “We cannot change laws to suit particular technologies,” he said.

SA has a variety of technologies already available, including 5G and fibre. Satellite internet services would be the third entering the space.

“We must ensure that there is fairness in the way that we treat people ... You can’t have licence conditions that are for some first-tier operators and not for the others. Before we can even talk about amending a law, there must be an economic assessment. That is what is under way now,” he said.

In the end, the process to on-board Starlink or any other satellite internet service provider is set to take months, or even years to complete as it will require legislative changes, which cannot be shoved aside through ministerial directives.

Icasa chair Mothibi Ramusi, briefing parliament on its role in reducing the cost to communicate, reiterated that the introduction of equity equivalents required proper process and consideration. 

“We are still doing our analysis. Now I can’t even say we agree or don’t agree. It is still a process that needs to be tested with the public,” Ramusi said. 

With Linda Ensor

MarrianN@businesslive.co.za