PRESENTATION BY SENTECH LIMITED TO THE ADHOC COMMITTEE ON COMMUNICATIONS
11 June 2004
2004 BUDGET VOTE

Sentech Team
Gladwin Marumo Chief Operating Officer
Dingane Dube Executive, Regulatory & Government Affairs
Johan Raath Executive, Office of the COO
Matime Nchabeleng Manager: Government Relations

Agenda
Sentech supports the position of the Department of Communications as expressed during their presentation before this house last week.

• Digitisation is key.
• Access is paramount
• The necessity of lifting specific restrictions

• Digital terrestrial television (DTT) is a key component of digitisation for South Africa.
• Digital relates to the way programmes are processed and transmitted.
• Multiple channels.
• Broadcaster owns the channel, Signal distributor owns the frequency
• Set-top-box / decoder.

• Efficient use of frequency spectrum.
• More broadcasters can be licensed
• Lower transmission cost.
• Saving to broadcasters
• Industry growth through local receiver manufacturing.
• Job creation
• Multiple language channel capability.
• Cultural diversity
• Ease of reception, simple installation and operation.
• Portable and mobile compatible.
• Advantages of DTT (2)
• Enhanced service offerings such as e-government adult education and health services.
• Lower transmitter power operation per TV service.
• No foreign control by satellite operators. (Dollar based foreign cost)
• Regional TV a strong driver.
• Rollout coupled to additional services as well as increased number of broadcasters
• Universal service targets comparatively easier to achieve for Public Broadcaster.
• Variety of programming and enhanced multimedia offerings such as EPG, news, games, etc.
• Delivery mechanism for distance education and e-Government.
• ervices can be encrypted - licence fee collection can be enhanced.
• International equipment manufacturers transition to DTT
• Will affect future analogue equipment and spares availability.
• Sentech’s current broadcasting network is old, analogue and must be replaced.
• Interactive potential
• Growth of the industry, bridging the digital divide
  

Coverage comparison
2 kW digital covers slightly more more than 20 KW analogue transmitter

Rollout Proposals

• South Africa has 9 million households
• 7 million households have television
• Sentech proposes rolling out in three phases:
• 50% of non-metropole areas plus Johannesburg (test site already there)
• Remaining 50% of non-metropole areas
• Metropoles
• This gives priority to regional television.
• Non-metropole covers estimated 24 million people
• Metropole covers estimated 20 million people

• 7 million set-top boxes @ R468 each
• 7 million antennae at R100 each (worst case as many will use existing antennae)
• Total R3.98 billion
• National transmitter network (5 services)
• Total R268 million

• Transmitters R153 million
• Decoders/antennae R2.27 billion
• (4 million @ R567 ea)

The cost of staying analogue

• High maintenance cost
• Replacement program is a priority
• Buy in dollars, sell in Rands
• No revenue growth
• Costly for broadcasters
• Capital cost of replacement program R300 million

What is needed to make Digitisation happen

• Commitment from policy makers
• A national digitisation policy
• A migration policy
• Support for viewers in respect of set-top boxes

Sentech Radio and Television Transmitting Stations Coverage [Map not included]
SABC1 Coverage [Map not included]
SABC2 Coverage [Map not included]
SABC3 Coverage [Map not included]
eTV Coverage [Map not included]
SAFM Coverage [Map not included]
Radio Sonder Grense Coverage [Map not included]
Umhlobo Wenene FM Coverage [Map not included]

Radio Coverage is universal

• Radio cover everywhere in South Africa
• Not all stations are received everywhere, but every citizen can listen to the radio.

PAS-7 Footprint Coverage [Map not included]
VSAT and DTH Coverage [Map not included]
PAS-10 Footprint Coverage [Map not included]
VSAT and DTH Coverage [Map not included]

• MyWireless Service
• Always on access
• 3 options
• 128, 256 or 512 kb/s
• No cap on data transfer
• Portable at no extra charge
• Self-installed – plug and play
• eMail account included in monthly price

My Wireless Customer Equipment

Lifting restrictions

1. Increase competitiveness
2. Managed liberalisation still intact
3. Reduced prices for customers
4. Increased competitiveness of all industries
5. Level the playing field
   

• What restrictions need to be lifted?
• Carrier of Carriers Licence
• Sentech should be entitled to terminate international services to end-users
• Amend Section 1 (definition of Carrier of Carriers service)
• Access to Submarine cable
• USAL’s

What restrictions need to be lifted for Multimedia?

• Internationally, multimedia communications encompasses all services, including voice.
• Sentech’s network is voice capable – you cannot purchase equipment that is voice restricted.
• Customers will use multimedia network for voice – impossible to police.
• Sentech should be entitled to carry voice.

What restrictions need to be lifted for Multimedia?

• Enable Sentech to carry voice services to the benefit of consumers by:
• Amend the definition of multimedia services in section 1 of the Telecommunications Act.
• Amend or delete sections 32C(8), 36A(h)(vi).
• Facilities to VAN’s.

What other restrictions need to be lifted?

• Amend Section 30A and 30B of the Act
• Enable Sentech to access 1800 Mhz and 3G spectrum.
• Amend Sections 36A and 36B of Act
• Enable Sentech to provide:

• Circuits for Voice over IP
• Facilities required for Private Telecommunication Networks
• Fixed links for mobiles and WBS
• Facilities for interconnection with USALs
• Facilities for VANs
• Facilities for fixed-mobile services in 1800 MHz band

Sentech thanks you for your attention

• As a state-owned company, Sentech is committed to delivery
• Bridging the digital divide
• Increased access for our people
• Increase information to our people
• Growing the South African base and moving into Africa
• Supporting NEPAD
• Lifting the restrictions as requested will bring significant benefits to our people.

Sentech congratulates the members of Adhoc Committee on their appointments and re-appointments and wishes them well in their vital task