B-TEL (PTY) LTD'S SUBMISSION ON THE CONVERGENCE BILL [B9-2005]
  1. INTRODUCTION
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    1. B-Tel (Pty) Limited ("B-Tel") welcomes the opportunity to participate in the process of enacting legislation regulating convergence, thus its submitting comments on the Convergence Bill [B9- 2005] as issued by the Minister of Communications ("the Minister") and published in Government Gazette No. 27294 dated the 16th February 2005 ("the Convergence Bill").

    2. B-Tel is a licensee that was granted an Under Serviced Area License ("USAL") after the Minister’s publishing of an Invitation to Apply ("ITA") in terms of section 34 (2) of the Telecommunications Act, No. 103 of 1996 ("the Telecommunications Act"). The ITA was for applicants, mainly small business operators commonly known as Small Medium and Micro Enterprises ("SMME/s"), to provide services in the under serviced areas. Following the licensing process in terms of section 40 A (2) of the Telecommunications Act, B-Tel was then granted an USAL.

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    3. B-Tel wishes to state that it welcomes the opportunity to and thanks the Portfolio Committee on Communications ("the Portfolio Committee") for affording it this time to make these oral representations to the Portfolio Committee.

    4. As an SMME, and specifically a newly licensed USAL, we as B-Tel are faced with the major task of ensuring that our business becomes a success. It is on this basis that B-Tel would like to highlight the fact that a lot of support will be required from all levels. It is on this basis that B-Tel welcomes the initiative to allow for the enactment of legislation that will allow for the growth of our business.

  2. SPECIFIC COMMENTS ON THE CONVERGENCE BILL

    1. Lack of a Clear Definition

      1. The Convergence Bill’s preamble reads as follows:

        2. "To promote convergence in the broadcasting, broadcasting signal distribution and telecommunications sectors and to provide the legal framework for convergence of these sectors; to make new provision for the regulation of communications and network services; to provide for the granting of new licenses and for new social obligations; to provide for the control of the radio frequency spectrum; to provide for the continued existence of the Universal Service Agency; and to provide for matters incidental thereto."

      2. Apart from this provision, the Convergence Bill does not provide for a clear definition of the term "Convergence", which omission creates an uncertainty around the meaning which should be applied.

      3. This is due to the fact that there are a number of authorities who have availed a definition, and each differs in one way or the other with the others, so that there is no one universal definition.

    2. Section 1: Definitions

      1. We suggest that the section begin as follows, after the number 1, "In this Act, unless the context indicates otherwise-".

      2. There are a number of words that are defined in the Convergence Bill which we do not think warrant their being defined. These words are defined but are hardly used throughout the Convergence Bill, thus going against the general rule that words not used in general in the body of a piece of legislation should not be defined.

      3. Words such as "content" and "content services" are included in the definitions clause, but there is very little or no reference thereto in the Convergence Bill.

      4. Another concern is the inability of the Convergence Bill to provide clear and precise definitions for key terms used therein. This illustrated in the cross referencing of definitions so that one definition makes reference to another definition thus creating confusion when one reads the Convergence Bill. The latter include the definition of "communications network service" and "communication service". It is difficult to determine which services form part of the communication services and which are excluded.

      5. The definition of "Complaints and Compliance Committee" reads as follows:

        6. "…means the committee established by the Authority in terms of section 17H of the ICASA Act;"

        However there is no section 17H in the ICASA Act. We can only request that the intended ICASA Amendment Bill contains such provisions.

      6. The Convergence Bill provides for "broadcasting service" as the key words in the definition of "license area". This looses sight of the fact that USALs were geographically licensed and the services thereof are not broadcasting services.

      7. Having read the definition of SMME, we wish to point out that the Act referred to is in fact the National Small Enterprise Act, No 102 of 1996, and the word therein defined is "small enterprise". We would suggest that more thought be put into the said definition, especially looking into the purpose for which the anticipated SMMEs, specifically the USALs were intended, so that the current definition of "SMME" is tailor made to cater for SMMEs in the information communications and technology industry.

      8. The definition of the acronym "SMS" revolves around "text", whilst the latter term is not defined. We therefore suggest that the word "text" be substituted with the word "content", which definition is broad and all inclusive, and has been defined as meaning any:

       

       

      "…(a) sound;

      (b) text;

      (c) still picture;

      (d) moving picture;

      (e) other audio visual representation or sensory representation; or

      (f) any combination of the preceding;…"

    3. Section 2: Objects of the Act

      1. B-Tel welcomes as one of the objectives of the Convergence Bill:-

        1. the development and promotion of SMMEs. We would however like to state that we require more recognition and assistance by the Convergence Bill as the reference to SMMEs seems to have been made in passing. We suggest that the manner of recognition and support that should be afforded SMMEs, specifically USALSs, should be that similar to that afforded to areas declared as industrial development zones.

    4. Section 3: Ministerial policies and policy directions

      1. B-Tel welcomes the clarification of the role and assignment of tasks, specifically policy formulation and regulation within the communications sector. B-Tel would however like to point out that there are instances were matters which generally fall within the scope of the Regulator have been included in the Minister’s arena. We therefore request that this be revisited so as to allow for a clear clarification of the roles played by the Minister and the Regulator, which in turn will allow for a better understanding of their respective roles.

      2. B-Tel notes that there is again reference to a specific section in the ICASA Act, which section 17F does not exist.

    5. Section 4: Regulations by Authority

      1. B-Tel would like to applaud the introduction of regulating in a converged environment as opposed to the Regulator regulating separately for Telecommunications and Broadcasting.

       

    6. Chapter 3: Licensing Framework

      1. B-Tel would like to obtain clarity as a general concern, specifically on the definition or interpretation of the word "License". It is not clear whether the word also includes USALs as contemplated in the Telecommunications Act. This is in light of the fact that the Telecommunications Act is to be repealed in terms of the Convergence Bill.

      2. The Convergence Bill has omitted to indicate where the USALs will feature in terms of the new market structure.

      3. B-Tel would also like to point out the uncertainty that prevails with the current licensing process, in light of the Convergence Bill. The suggestion would be that the Convergence Bill should not interfere with or delay the process already developed or being put in place with regards to the second round of licensing for USALs.

  3. General Comments

      1. Retention of Current Rights

        1. B-Tel is currently entitled to provide services which, at a minimum include local, voice, telephone service, emergency services, directory service, voice over internet protocol, public pay phone and operator-assisted services. USALs are in fact authorized to render multimedia services or converged services.

        2. In terms of the Convergence Bill, there is provision for 4 (four) types of licenses to be issued for various services, namely: Infrastructure Services; Communications Network Service; Communication Applications Service and Communications Content Service.

        3. It is not clear whether under the new dispensation, considering the fact that there is no clarity with regards to the new licensing structure, will the USALs be permitted to provide the same services or retain their current rights, in terms of their licenses.

      2. Clarity in Terms of Area of Service

        1. The definition of "license area" seems to apply to broadcasting licenses only so that USALs are excluded.

        2. This exclusion by the Convergence Bill fails to provide clarity on the area within which B-Tel and other USALs will be operating. Does the Convergence Bill limit the area of operation of the USALs to the under serviced areas only?

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        3. It is also not clear whether, in the event that the area of operation of the USALs is limited to the under serviced areas only, will there be new operators/USALs licensed within the said areas of operation of the USALs.

        4. B-Tel further requires clarity as to whether should USALs be allowed to operate beyond their respective under serviced areas, in other words be allowed to operate nationally, would they then have to first wait for the Minister to determine the time and area to be licensed.

        5. It is also important for B-Tel to get clarity on whether in the event that they are as USALs allowed to operate beyond their license areas, if this would not amount to competition amongst them and if such competition would be allowed.

        6. In the event that the USALs are permitted to operate nationally, would the usage of the Universal Service Fund subsidy for purposes of putting up infrastructure in the areas beyond their currently licensed USALs be permissible?

  4. CONCLUSION

    1. B-Tel would once again like to thank the Portfolio Committee for the opportunity to make this oral representation and hopes that it will assist in the process towards legislating for Convergence.