Tough tasks for new ministers

Re-organising of ministries, regulating telecoms competition and reforming underperforming agencies are the key priorities for incoming ministers, say analysts and industry observers.

While they may differ on priorities, they all agree that, despite impending ministerial changes, change is still a long way off.

According to Adrian Schofield, JCSE manager, Applied Research Unit, change will only come if there is a critical evaluation of past performance of government ministries. “The reality is that it is the same party in charge of the country again and so there really has been no significant shift in political stance.”

Schofield states that the cost of access to broadband needs to be sped up and that the roll-out of technology to schools has become vital. Meeting the needs of the 2010 World Cup is also imperative along with evaluating underperforming agencies such as SITA, ISETT SETA, and USAASA, he says.

The Department of Communications (DOC) has come under fire for delayed projects and lack of policy directives. Ant Brooks, GM of the Internet Service Providers Association (ISPA), notes one of the many gripes levelled against the ministry. The ISPA says it has been waiting to be recognised as an industry body by the DOC for over five years. “We have been going to and from the DOC for five years now trying to get the minister to recognise ISPA as an industry body.

According to Brooks, one of the key failures of the DOC was its failure to champion its own policies and projects. “It would be nice to have the DOC pay more attention to other legislation, which lies with other departments, but affects them,” he notes.

While it is expected that some reshuffling of responsibilities in the DOC will occur to increase its efficiency and speed up delivery, it is not yet known to what extent. Other departments have made their intentions clear. The Department of Public Enterprises (DPE) has made recommendations that a shareholder agency be established. The DPE states that the agency would be tasked with the running of Telkom, Broadband Infraco and Sentech, among others.

“Given the complex nature of balancing commercial and developmental sensibility in order to coherently mediate between strategic government objectives and the on-going commercial viability of the SOE, and to transact with the private sector in cases of co-investment, we recommend the establishment of a specialised agency tasked with a strategic portfolio of enterprises,” says Sandra Coetzee, deputy director-general of the DPE.

The DPE has taken cognisance of the sometimes complex relations between various departments and believes the agency will provide a solution. “The institution will need to be able to engage with and facilitate programmatic coordination, across the full spectrum of government departments around the achievement of developmental objectives, while maintaining some autonomy from policy departments,” says Coetzee.

Wil Kahn, principal research analyst at Gartner, says there are several key issues regulators and operators need to clarify. He states that the changing landscape will need to be closely regulated to enable an advanced liberalised regime.

“The single most important thing this year is a well-expressed, consistent and agreed-upon statement about how operators will be encouraged to treat each other. With a clear understanding of these 'rules of engagement', new entrants can decide where and whether to build facilities, what kinds of service packages to put together for customers and how to go to market.”

Kahn says that the Altech ruling, allowing VANS to self-provide - although a positive step for the country - has created a condition of “flux and uncertainty” and regulators need to step in to monitor, prevent and correct any anti-competitive behaviour. The reality says Kahn, is that non-facilities based competition will result in an “asymmetric regime”, which will need to be addressed.

“A major question to be addressed is how much of this will rest equally on the mobile carriers, as well as Neotel and not just Telkom. Will they be judged to have market power based on size, share of total customers or some other basis. Will mobile and fixed services be treated the same for this purpose?”

Birgitta Cederstrom, programme manager for ICT at Frost & Sullivan, says that SITA should be a priority for the incoming government. “I think everyone in the industry would like to see the government assist SITA to clean up its act and get its governance, procurement practices and business model in order. It is time for SITA to stop fiddling and to deliver.”

SITA has been plagued by challenges for years and has seen controversial headlines around misconduct, tender irregularities and mismanagement.

Schofield says there has been lots of talk about fixing SITA, but it remains doubtful that incoming ministers will prioritise such issues. “We will have to see if change really happens - as opposed to what happened over the last 10 years,” he says.