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OVERVIEW

In my address to this forum in February, I gave an outline of key issues constituting the Department of Communications' (DoC's) programme of action for this year. When I delivered my Budget Vote speech in May, I elaborated further on the department's programme for delivery of services to our people for the current financial year. Our programmes are informed by the government's recognition of the centrality of the information and communication technology (ICT) sector in the growth and development of modern economies. In line with this our main focus areas relate to expansion of economic opportunities, infrastructure rollout, management of regulatory environment, job creation and expansion of the services sector. In pursuit of the realisation of our developmental goals, we embarked upon development and implementation of several policies and programmes, in telecommunications, information technology (IT), multimedia, postal services and human resource development and international level participation in pursuit of New Partnership for Africa's Development (NEPAD) goals and the World Summit on the Information Society (WSIS).

In the telecom sector we outlined our programmes and progress on:
* The introduction of the Second National Operator (SNO)
* The licensing of the under serviced areas
* The granting of multimedia and International Gateway licences to Sentech
* The implementation of the Electronic Communications and Transactions (ECT) Act
* 1800 spectrum for mobile operators
* The establishment of the 112 emergency centre
* Rollout of infrastructure and delivery of telecom services

The process of opening the airwaves with the view of fulfilling our national mandate in broadcasting, found concrete expression in development of relevant legislation, policies and the roll-out of infrastructure. In this regard we highlight the following:
* Implementation of Broadcasting Act
* Development of Convergence Bill
* Introduction of regional television services
* Further rollout of community radio stations
* Satellite communications

The centrality of the Postal Sector in the provision of basic communications services to communities, especially in the historically disadvantaged areas remains the focal point of our programmes. In striving to achieve a universal access mandate the following projects were embarked upon:
* Repositioning of Post Office
* National address system
* Restructuring of the Post Bank
* Rollout of infrastructure
* Enhanced and clearer role of the Postal Regulator

The department is playing a pivotal role in the development of ICT human resource skills through the Institute for Satellite and Software Applications and National Electronic Media Institute of South Africa (NEMISA). We have been instrumental in initiating the Advance Institute for Information and Communication Technology (AIICT). We continue to make giant strides in this regard.

At the international level, we outlined our role in the advancement of our ICT agenda in Africa and the world. This is mainly achieved through participation in international ICT fora where in some instances our country occupies strategic positions.

The department has made major progress in achieving these goals we have committed ourselves to attain in the beginning of this year. The full details regarding our achievements are aptly captured in the accompanying media briefing report.

For purposes of brevity I will only point out highlights of our progress report to allow ample time to engage with you.

Next week the ICT sector is meeting to discuss the charter for the sector. I would like to further encourage them to work in an inclusive manner in this initiative. I am confident that all stakeholders will work together in crafting this very important framework for this sector.

TELECOMMUNICATIONS

OUTLINE OF DEVELOPMENTS SINCE AN INVITATION TO EXPRESS INTEREST WAS ISSUED

On 29 August, the Independent Communications Authority of South Africa (Icasa) forwarded recommendations on the 51% equity stake in the SNO. They recommended that none of the two bidders should be awarded this stake.

While I was busy applying my mind to Icasa's recommendation I received written presentations from the two bidders and other interested parties. Given the public interest and the magnitude of this project, I have solicited legal advice from Senior Counsel in order to give an appropriate response to Icasa and all affected parties. Once Senior Counsel has responded I will be able to make a formal announcement.

UPDATE ON UNDER SERVICED AREA LICENCES (USALs)

The licensing process for USALs

The closing date for the first phase of licensing for under serviced areas applications was 29 August 2003. The process involved public comments process on regulations and draft license. Policy guidelines for the subsidisation of USALs were issued together with a new model for subsidisation of under serviced area licensees for acquisition and construction of infrastructure. Sixteen (16) applications were received from all the provinces that will be issued with two licences each in the first phase. The affected areas are: KwaZulu-Natal, North West Province, Free State, Eastern Cape and Limpopo.

ECT ACT SINCE THE PUBLIC NOTICES WERE ISSUED ON NOMINATIONS FOR THE BOARD OF DIRECTORS

The .za Domain Name Authority was registered in terms of the Companies Act on 30 August 2003.

The following persons have been appointed to serve on the Board of Directors:
* Ms Preeta Bhagattjee
* Mr Sonwabo Eddie Funde
* Dr Hashmukh Gajjar
* Mr Richard Heath
* Ms Xoliswa Kakana
* Mr Alan Levin
* Ms Nomvula Mbangela
* Mr Michael Silber
* Mr Victor Wilson

I wish to announce the appointment of Dr Hashmukh Gajjar as the Chairperson of the Board.

The Board will appoint a Chief Executive Officer and staff to manage the Authority. An implementation team is working on ministerial policy directions to facilitate the transfer of the domain name space from the current .za administrator to the Authority and to guide the Authority in drafting domain name regulations.

PREPARATIONS TO THE LAUNCH OF 112 CALL CENTRE

The establishment of the 112 Call Centre has been completed and is technically ready for operations subject to acquisition and integration of subscriber data from the various operators. To this end, the signing of Non-Disclosure Agreement with Telkom and Vodacom is imminent. This will allow the project team to complete final acceptance procedures and stress testing. Furthermore, the Department is currently in discussion with emergency agencies on technical and operational matters such as standard operating procedures.

The initial rollout will be in the Western Cape.

DEVELOPMENTS AND UPDATE ON CONVERGENCE

As a consequence of the convergence of networks between telecommunications, broadcasting and information technology, the department initiated a consultative process of reviewing current policies for the ICT sector in June of this year, which culminated in the Convergence Colloquium in Johannesburg on 15 to 16 July 2003.

Four commissions were established to interrogate issues around infrastructure, applications, content and services. Representatives of each commission prepared a consolidated report that was presented to me after the Colloquium. That report summarised the key outcomes of the Colloquium. A Committee composed of representatives of the Colloquium commissions was established to help prepare the Bill that is in the final stages of drafting. This draft Bill will be tabled to Cabinet in October.

SATELLITE COMMUNICATION PROJECT

The satellite service providers continue to characterise the regulatory environment in South Africa as being too restrictive thus impeding growth of the satellite based services. This matter is receiving attention in the convergence process.

After the submission of the report by the consultants, the department started a process of engaging the sector stakeholders exploring the best option of implementing the recommendations of the study. A growing number of international satellite operators and satellite-based service providers are expressing interest in the African market.

On 2 September 2003 representatives of the DoC, Department of Trade and Industry (dti) and Department of Science and Technology (DST) met to discuss the contents and process of a cabinet memorandum that will be bring to the attention of the cabinet issues related to the implementation of the outcome of the study.

From 4 to 10 October, South Africa like many other nations will be celebrating World Space Week (WSW). The DoC and DST are actively involved in the preparations.

SENTECH

Sentech is progressing well with its plans to launch the multimedia business before the end of this calendar year.

Sentech's strategic focus on the launch of the multimedia products has recently borne fruit when Sentech successfully launched the first of its multimedia products, the VSAT "always on" Internet service called VSTAR on 29 August 2003 at the Cradle of Humankind. The remoteness of this location lent itself to Sentech being able to demonstrate the capabilities of the VSAT product and services and its suitability to rural areas. VSTAR is a commercial-grade VSAT service that is entirely satellite-based thus enabling it to provide service to users from any location where electricity is available and is not dependent on the availability of landlines.

Sentech and NXT have identified a major opportunity for linking state and private institutions so as to enable the establishment of centres of excellence in radiology, which can diagnose and report on x-ray images. This will enable state hospitals, for example, to have radiological images read and diagnosed by radiologists in either private or public practice. This will solve a major bottleneck in health care. The potential partnership with NXT to provide a solution for forwarding and storage of x-ray images is at an advanced stage. The trial system was installed linking three private hospitals and the public hospital in Queenstown using Sentech VSAT. The system works extremely well and trial usage is underway. The Department of Health has been approached with the proposed solution.

Sentech is also providing the communications backbone for the HP I-Community Project in Rebone and Mahwelereng using VSAT technology. They envisage entering into an agreement with HP through which Sentech will become a technology partner.

Signal distribution

Both SABC 1 and SABC 2 services were put on air at Tolwe on 16 May 2003 and Straalhoek on 23 May 2003 respectively. As part of an agreement with the DoC, a number of community radio broadcasters were placed in-service at Sentech's transmitters sites from May to July in Senekal, Witsieshoek, Thaba Nchu, and Ficksburg. Nine (9) of the 11 new transmitter stations for FM Services have been established in the last quarter.

Corporate social investment

Sentech and the Universal Service Agency (USA) have developed a good working relationship, resulting in the two entities preparing to sign a Memorandum of Understanding (MoU) by end of September 2003. In this partnership, Sentech will be a technology partner to the USA, providing connectivity to 100 telecentres. The Siyabonga Telecentre in Orange Farm, to which VSAT "always on" Internet access was provided free of charge for one year, was the first beneficiary of this joint venture.

The company has installed an additional 12 FM and television transmitters in Nigeria and additional transmitters are to be installed in due course.

The Ugandan Ministry of Information invited Sentech to visit Uganda to discuss cooperation in Signal Distribution. An MoU was signed between Sentech and the Uganda Broadcasting Council (UBC). Sentech has defined the general technical requirements and provided the UBC with a detailed project plan for expansion of the network.

TELKOM

Telkom has broken new ground in creating a culture of share ownership among South Africans. With more than 100 000 South African retail shareholders, they have one of the largest retail shareholder bases in the country. This followed their listing in March 2003 on both the JSE Securities Exchange South Africa and the New York Stock Exchange, which saw the South African government reducing its 67% ownership of Telkom to 39,3% through an initial public offering (IPO).

Retail and institutional investors now own 27,7% of Telkom, while 30% of its shares are held by strategic equity partners, Thintana Communications (consisting of SBC Communications and Telekom Malaysia), and 3% by Ucingo Investments, a black economic empowerment consortium.

On 4 March 2003, government granted share options to Telkom employees (the Diabo Scheme), offering them up to 11 140 636 of its ordinary shares representing 2% of Telkom's issued and outstanding ordinary share capital.

Coming from a traditionally male-dominated sector, Telkom is proud of the leadership role that women are playing in the company, such as Nomazizi Mtshotshisa, Chairman of the Telkom Board, along with four top women executives. Overall, women represent 27% of the total workforce, 18% of middle and senior management, and almost half of all new managers being appointed.

Telkom has 348 employees with disabilities. At the Florida call centre in Gauteng, for example, employees with disabilities make up 5% of the total head count.

UNIVERSAL SERVICE AGENCY

Evaluation and Consolidation of USA Projects

USA has conducted an evaluation of its 68 telecentres and 21 school cyber labs that have been rolled out. The evaluation demonstrated successes as well as some weaknesses in improving universal service and universal access to ICT in the underserved areas. This evaluation has assisted the USA in developing new strategy plans to meet the challenges of rolling out ICT services in the under-served areas of South Africa. Based on the evaluation report, the Agency took a decision to first consolidate the existing facilities and improve their performance before rolling out the new facilities.

In coordination with the Integrated Sustainable Rural Development Programme (ISRDP) the Agency is focusing on the rollout of ICTs to the nodal points as a tool to facilitate the socio-economic development of these areas. The guidelines for the subsidisation of USALs for the development of infrastructure to promote universal service and universal access in the under serviced areas have been gazetted. Each under-serviced area licensee will receive a subsidy of 15 million rand over the next 3 years.

BROADCASTING AND MULTIMEDIA

Implementation of the Broadcasting Amendment Act

The date of conversion of the SABC into a public company is scheduled for 1 October 2003 and a draft memorandum and articles of association of the SABC Ltd has been completed. SABC has submitted an asset valuation report to us as well as intellectual property valuation report.

SATELLITE COMMUNICATION NETWORK

Cabinet approved the establishment of the Satellite Communications Network to link national and regional parliaments, departments and community radio stations.

MMU met different role players with the aim of putting in place mechanisms to establish the Network. The Community Radio Sector, represented by the National Community Radio Forum (NCRF) accepted the proposal. The NCRF and the DoC agreed to exchange technical specifications and integrate the capacity of the stations and NCRF in the proposed Satellite Network. This technical work is continuing.

Regional television

In terms of the Broadcasting Amendment Act, the SABC is to submit applications to ICASA for additional regional television services by 8 December 2003. The SABC team preparing this application is active on a number of work streams including:
* content and scheduling
* signal distribution
* facilities
* financial impact on SABC as a whole
* funding requirements of the new channels.

Another factor in the rollout of regional services is the policy framework for such services. On 22 August, ICASA published Discussion Papers on Regional and Local Television. These papers seek public input on the policy framework for public and commercial television at a regional and local level.

REGULATION ON ALLOCATION OF TELEVISION LICENSE FEES

Section 27(8) of the Broadcasting Amendment Act reads as follows:

"All television licence fees collected by the Corporation must be used by the Corporation solely for the public service to be provided by the Corporation". To give effect to this directive the SABC's financial allocation model for television licence fees is as follows:

One-third of net television licence surplus is to PBS Radio, consisting of the following radio stations: Ukhozi FM, Umhlobo Wenene FM, Lesedi FM, Thobela FM, Motsweding FM, RSG, Munghana Lonene FM, Ligwalagwala FM, Ikwekwezi FM, Phalaphala FM, SAFM, Lotus FM, CKI FM.

Two-thirds of net television licence surplus to PBS Television, consisting of the following television channels: SABC1, SABC2.

The SABC has completed a detailed technology plan to migrate the broadcaster to digital production facilities over the next 3-5 years.

ROLLOUT OF MULTIMEDIA INFRASTRUCTURE.

Policy on universal service and access has been published as a draft for public comment and input.

Since 1999 until 2003, ten new transmitters have been making SABC radio available to 2,7 million more people. Plans are on track to activate three more transmitters for Lesedi and Ukhozi. Transmitter expansion for SABC 1 and SABC 2 has been approved by ICASA to reach more people. On completion SABC 1 footprint will increase from 83% to 89%, SABC 2 from 85% to 91%.

EDITORIAL POLICY PROCESS AND ISSUES OF LOCAL CONTENT.

The process started early in the year with closing date for written submissions on the draft editorial policies being 13 June 2003. There was positive response from members of the public and organisations, with 931 submissions received from all provinces.

To encourage members of the public to participate widely, the SABC held public meetings on the policies in all nine provinces and also devoted a number of television and radio talk shows to discussion on the policies.

The Board will finalise the policies soon before submitting to ICASA before the end of December.

NATIONAL LANGUAGE AND CONTENT SUMMIT

Provincial summits have been held in all provinces except in the Free State, Northern Cape and Gauteng. These will culminate in a National Language and Content Summit to be held in mid or late October 2003.

POSTAL SERVICES

National address system

The department, in conjunction with South African Post Office, is in the process of providing addresses to all South Africans. It estimates that of the 11 million households in South Africa, 4,5 million do not have addresses and these are mainly in rural areas and some urban settlements. This means that they cannot participate fully in the socio-economic activities of the country, including government service delivery programmes.

The process of providing addresses entails the development of a common framework for the provision of addresses involving the relevant stakeholders. It necessitated a review of existing addressing systems, benchmarking studies, gap analysis and the development of a framework. The Post Office's process started in February 2003. We are in the process of finalising the framework for the national address system taking into consideration lessons from other countries. This is being tested at the pilot site at Ga-Rasai Village in Madibeng Local Municipality, Brits in the North West Province.

REPOSITIONING THE POST OFFICE

As indicated in the Ministry of Communications Budget Vote 2003, a lot of progress has been made in a number of critical areas:

FINANCES

In the financial year 2002/2003 the Post Office revenue grew by 6,8%, generating operational cash of R118 million. At the same time, the Post Bank deposits increased to R189 million.

Last year government re-introduced the subsidy for the Post Office to cater strictly for turn-around projects. As part of the agreement, the Post Office has submitted an annual funding plan, which is monitored and reported to the DoC on a monthly basis.

IMPLEMENTATION OF THE ECT ACT

Following the passing of the ECT Act, which mandates the Post Office to be a preferred authentication authority of online transactions, two Trust Centres have been created in Grabouw and Johannesburg to integrate the technological needs of the Post Office. These facilities will provide legal certainty and digital certificates. Linked to this the Post Office has introduced a pension payment system which uses biometrics technology for security.

The pilot was launched in Brits in March this year, and plans are underway to rollout the facility to other parts of the country, notably the Eastern Cape. The Post Office recently won an award for "Most Promising New Innovation". This was one category in the Innovation and Sustainability awards, underwritten by the DST. This award is awarded nationally once a year.

NATIONAL INFRASTRUCTURE

Significant progress is being made with the rollout of infrastructure across the country. 17 Citizens Post Offices and sixty conventional Post Offices will be launched by the end of the 2003 financial year.

A True African Company

There is no doubt that as we enter the second decade of democracy, South African Post Office (SAPO) will be able to respond to the challenges of the implementation of NEPAD. By virtue of being the biggest postal administration on the continent, SAPO has an urgent task to avail its expertise to help other post offices across the continent to re-engineer to deal with the new continental challenges as well as the globalisation.

The signing of the Memorandum of Understanding between SAPO and the Angola Post Office later this year will consolidate the partnerships that the company is forging with other players on the continent. Partnerships with Rwanda and Senegal are also being considered.

The Post Office currently hosts the administration of the Southern Africa Postal Operations Association whose Director, Mr John Sikhondze, (Swaziland) has retired and will be replaced by Mr Kenneth Moyo (Zimbabwe).

HUMAN RESOURCES DEVELOPMENT

ISSA

ISSA's new direction is gradually changing from that of being a training institute only to one that focuses the energies of its researchers in the development of key software solutions to meet the growing needs of the ICT sector in South Africa.

To meet this need, ISSA's Research and Development internships have been put together to provide practical development work exposure, coupled with appropriate training, in a "live" environment. These are meant to ensure joint development of software products in partnership with industry, as well as ensure effective diffusion of skills. Since February, 21 of ISSA's graduates have been placed in internship programmes at Spescom. The institution is presently forging relationships with IBM, Microsoft, Dimension Data, CSIR and Sunspace.

Through the Business Incubation programme, ISSA facilitates the development of new Small Medium and Micro Enterprises (SMMEs) by the newly graduated students, which will lead to the emergence of future business leaders. One of the ventures that has been set up as a result of this is Qhubeka Phambili Network Technologies (QPNT). It is 100% owned by a group of 24 women graduates of ISSA. QPNT has secured contracts and partnerships relating to the networking of some national infrastructure with SAPO, the 112 Call Centre, as well as with Dimension Data. As a result, QPNT has now outgrown the incubation programme, and has subsequently entered the business arena.

In February 2003, two new incubation companies owned by 16 other women graduates of ISSA were formed. These companies have already secured contracts with PetroSA, the USA, Bluepages.com, among others.

NEMISA

Presently there are 50 learners who are studying towards a two-year Diploma in Creative Multimedia and 30 learners will be completing the programme in October 2003. This is a historical moment for the institute, in that it will be the first group of historically disadvantaged learners that will have attained this comprehensive qualification. This qualification enjoys a joint accreditation status by both the South African Council on Higher Education and the Malaysia Multimedia University.

The learners have been able to distinguish themselves within the sector and 95% of learners who are due to graduate in November 2003, have already secured employment and are making a huge impact in their respective fields of study.

The South African government through the DoC entered into agreement with the French government to develop and advance radio skills development through the Khuluma Project. NEMISA is part of this exciting programme and is at the centre of co-ordination of the training. This three-year skills development programme for the community radio sector will have a significant impact on the level at which this tier of broadcasting operates.

The Institute has embarked on the language portals project. This is the first project of its nature in South Africa and will have a fundamental effect on the manner in which media is consumed in the country. Twenty-six individuals from across the country were assigned the task of producing content in indigenous languages. The projects, operating under the name of Lesaka, will see website development in these languages.

Training for the disabled is enjoying priority. A customised training programme has been designed specifically to meet people with disabilities. A short radio course was identified for piloting the training. Through the experience from this pilot, the institute will then develop a full-time program on training people with disabilities in the various multimedia training programs.

DOC`S INTERNSHIP PROGRAMME

This year, the Internship Project of the Department is marking its third anniversary. This project is growing steadily.

The project recruits graduates from historically disadvantaged tertiary institutions and it empowers them with practical experience and knowledge of socio-economic and technical issues related to the ICT sector. The project has recruited 26 interns - 15 of who are women. In 2001 and 2002 however, the project focused on law and economics disciplines. This year communications and information technology were added.

INTERNATIONAL RELATIONS

The e-Africa Commission held a preparatory workshop for WSIS on 14 to 16 September 2003 at Eskom Conference Centre in Midrand. The workshop was attended by government, private sector, civil society and delegates from several African countries. The matter for discussion was the Declaration and the Plan of Action of WSIS and recommendations were made in this regard. The National Preparatory Committee on WSIS held its meeting on 5 September for further discussions.

Issued by: Ministry of Communications

12 September 2003