Publications

SA CONNECT – POLICY ABOUT POLICY

What is happening to broadband roll-out for all in South Africa? When will we get it? Where is the timeline? Will it be affordable for all? Will it be a high-speed network that spreads the benefits of access at low cost to the majority of the population? Where’s the real plan, Mr Minister?

We have a 61-page “policy” documented in the Government Gazette. All words and no milestones in Appendix 3 which simply sets out bland indications of what is to be done. Here we have a blatant admission that nothing real has been done on policy formulation. The work, objectives and milestones are still to be formulated. Now, surely this cannot be the country’s broadband policy. It is policy about policy.

According to South Africa Connect, which is the country’s national broadband policy, we have to wait until 2030. By this date “a widespread communication system that will be universally accessible across the country at a cost and quality that meets the communication of citizens” will be in place.

This is cold comfort for millions of people who are unconnected and the millions who are connected but cannot afford the high cost of the services offered by the operators. Many millions of school children will continue to be deprived of the most basic service that can assist them. For a child who starts school in 2015, by the time she leaves school a national affordable broadband network will still not be in place.

The policy correctly identifies the lack of always-available, high-speed and high quality bandwidth required by business, public institutions and citizens has impacted negatively on the country’s development and global competitiveness. You have only to look at the latest September 2014  report of the Broadband Commission of the International telecommunications Union and the UNESCO to see how badly SA fares among in the world of broadband.

The report, released in September 2014, makes wide-ranging recommendations to countries which are targeting broadband access for citizens. The report covers education, gender equality, infrastructure and sustainable development, among others. In reviewing developments around the world – in the developing and developed countries – the report distils the lessons for successful broadband development.

South Africa is a member of the ITU and has access to all its documents and the experiences of broadband development around the world yet its policy does nothing for the development of broadband. Its self-criticisms are devastatingly accurate and the Department of Communications is to be complemented for its honesty. Here is one of many examples found in the SA Connect policy document:

“Significant growth in the ICT sector over the last decade has not been accompanied by the realisation of the primary policy objective of affordable access for all to the full range of communications services that characterises modern economies.”

The alleged policy document claims the priorities of electronic communications will be finally implemented by 2030. Is government seriously asking the country to wait for 2030 for universally accessible broadband at a cost and quality that meets the needs of citizens.

Government says one of the factors that will lay the foundations for South Africa’s future broadband success “policies that constrain the competitiveness of markets and the rolling out of broadband will be removed”. And, what are these constraining policies? The SA Connect policy document is silent.

The DoC says that it will issue a directive to ICASA to expedite the assignment of assignment of broadband spectrum. However, the assignment of broadband spectrum is not the main issue. The issue is to whom will this spectrum be issued? The second problem is: will the beneficiary of the assigned spectrum be in the game for profit or for the public interest.

This is the nub of the matter. While public-partnerships have a role to play in the roll-out of broadband, a profit motive is an effective brake on the roll-out and does not assist in spreading the benefits of broadband. The move to an open access national broadband network is of little benefit if an over-riding public interest element in the roll-out and in access to connectivity are wanting.

The SA Connect policy document is riddled with phrases like “the Minister of Communications will consider…” , “the DoC will prepare a detailed roadmap …”, “consideration will be given …”, “there will be incentives for …” are strong indicators that this is more a document about policy than it is a policy document. The policy document is one which records a broad intention at no particular time and no milestones are identified.   Nowhere does the Minister actually say what he will do in reality.

The DoC says “reviewable targets have been set starting with an average user experience speed of 5 mbps to be reached by 2016 and available to 50% of the population and to 90% by 2020”.

The policy document does not take us into its confidence about how the country will achieve an average user experience of 5 mbps by 2016. Nor does it tell us what the cost of this access will be for the average person. We are given no clues about how the government intends to reach these goals, what the development cost will be and what citizens can expect to pay for access to a high-speed broadband network. We have a surfeit of nice-sounding words and a worrying lack of very important detail.

As an example, Appendix 3 of the policy document is instructive. It identifies targets without a single date, without reference to any timeline and focuses on broad and general principles that, without specificity, have little meaning.

No one would complain if government set modest and achievable targets – in our lifetime – so that we can at least enjoy limited low cost, high-speed access in some areas that gradually spread to the rest of the country. Even that is avoided in SA Connect.

At the beginning of this article several questions were raised. SA Connect national broadband policy takes a view so broad that it can answer any question about broadband in a manner that gives no specific answer. Look again at the SA Connect policy document, in particular at Appendix 3, the National Broadband Network Roadmap.

Here you will find anything but a roadmap. You will see words like “planning input”, “broadband demand model”, “economic models”, “desktop and other activities”, various references to “modelling” “future network architecture” and so on. You will even see the word “timeline” but nowhere will you actually see a timeline. After reading the policy about policy you will experience profound anxiety and an inability to understand whether affordable high-speed broadband is a service that will be available during your lifetime.

The SA Connect policy is an example of a policy reflecting failure and apathy; it reflects how deeply government misunderstands its role in developing broadband. The so-called citizen-centric policy approach, which it posits, is a complete disconnect with the priorities for broadband and its development around the world.

In effect, we have a “no connect” policy and the South African broadband policy is really more about words than action.

1 October 2014, Business Day Live http://t.co/FyIxEOzIt3

Ayesha Dawood is an Africa Expert, International Law, Corporate Law and Digital Media lawyer at Ayesha Dawood Attorneys (@ConsultAyesha)  She is also MD of Digitalnfo.com.   (Digitalnfo) a not-for-profit site that is designed to contribute to understanding the digital environment and its implications.

 

 

Why SA can’t get movies online? SA lacks the will to transform itself into a digital beacon

In many parts of the world the Internet is the primary provider of information, news and entertainment. All the dramas, sitcoms and television series are among the daily offering. Netflix, a popular US-based, content service has millions of subscribers many outside the US. Sadly, Netflix won’t be avaibale in South Africa.

The reason? Access to the Internet is just too expensive and download speeds are far too slow. Therefore, Netflix does not see a viable market in the country. For years the government has been drafting and altering the policy documents on broadband but the price of Internet access continues to remain outside the affordability of most South Africans.

Video streaming is the holy grail of the Internet and for the majority it will probably stay that way.

The International Telecommunications Unions (“ITU”), an agency of the United Nations, continues to provide world leadership not only on technology but, importantly, on “fostering equitable access to the modern technologies that can transform people’s lives and help break the vicious cycle of poverty and isolation”. The ITU says its development goals prioritise equitable access, not just across countries, but within communities, with special focus on gender issues, youth access, the disabled, indigenous communities and very remote populations. There is also a special direct aid programme targeting the 49 UN-designated Least Developed Countries (LDCs).

UN Secretary-General Ban Ki-Moon says on the ITU site:Through e-learning, e-health, e-government, climate monitoring and more, today’s and tomorrow’s technologies will help bring the Millennium Development Goals (“MDGS”) within reach. The power of fixed and mobile broadband will further improve our ability to extend basic services to communities – even those in the remotest places – in ways that where inconceivable when the MDGs were first articulated more than a decade ago.”
According to the ITU the number of mobile cellular subscriptions worldwide is now well over five billion and more than two billion people world-wide have access to the Internet. In terms of ICT access it’s been a miraculous new millennium for most of the world’s poorest nations, and especially for the LDCs, with the total number of mobile cellular subscriptions in the LDCs as a whole rising more than 150-fold since the year 2000 – from under 2 million to 280 million by the end of 2010.

But the ITU is concerned about the many problems that still remain. The buoyant regional growth averages hide wide disparities, it says, and while some LDCs are booming – at end 2010, Gambia and Mauritania, for example, boasted mobile penetrations of 80% or over, far higher than the European average of 50% in the year 2000 – Eritrea still has an effective teledensity of less than 4%. In the Pacific, Samoa has a mobile penetration of 91%; Kiribati, its near neighbour, has 10%. And Myanmar, in contrast to many markets in Asia, has just 12 mobile subscriptions per 1,000 people.

This is in stark contrast with the industrialized world where Europe now has many more mobile subscriptions than inhabitants, and where, globally, 100 countries now boast mobile cellular penetration of over 100%. But phone service is just one part of the puzzle in a globalized economy that increasingly relies on online information exchange. At the turn of the millennium, the 49 LDCs shared just 178,000 Internet subscribers. While that number is rising, penetration remains low, at just 4.6% in 2010.

Turning to broadband, the ITU says, penetration in parts of the developing world remains largely confined to foreign-owned businesses and the tourism sector. In 32 of the world’s developing nations, the cost of a monthly broadband subscription is over 50% of per capita monthly gross national income – compared with under 5% of per capita GNI in the top 46 countries in the ITU’s ICT Price Basket.

According to the estimates (and there are several) the rate of Internet penetration in South Africa stands at about 48.90. Now look at South Korea: more than 90% of the people are connected to a low-cost high speed network.

South Africa is a wealthy country, although plagued by a legacy of structural economic problems. Its infrastruture, in broadcasting and telecommunications, is outstanding. In broadcasting more than 90% of the population have access to terrestrial television.

 

Unlike broadcasting the broadband infrastructure is expensive and its benefits are therefore limited, making the online video market unsustainable. As government commitment to an affordable broadband network does not appear to be a matter of priority, the country’s full participation in the digital world remains elusive. In South Korea, for example, progressive digital strategies as well as an incredible determination to roll out an affordable broadband network has made the country one of the world’s leaders in digital innovation and development.

South Africa ranks at least 5th in Africa and 92nd worldwide for individual Internet usage, according to a 2013 State of Broadband Report released by the UN Broadband Commission. There is no further information to date to indicate that South Africa has moved up a rank. In terms of Internet speed, South Africa ranks 6th amongst Africa’s Top Ten countries, with Ghana taking the lead followed by Zimbabwe, Kenya, Libya, Madagascar, South Africa, Morocco, Nigeria, Rwanda and then Mozambique. (IT News Africa, 2012.) By 2012 estimates – Zimbabwe was ahead of South Africa and that should worry us.

South Africa seems to lack that will to transform itself into a continental digital beacon. This is not a hard problem to solve. It needs a will and commitment to building an infrastructure, although some of the infrastructure is in place.

The first problem is access to the Internet in the cities and in the rural areas. The second problem is the cost of the access to high speed connectivity.

Government is expecting to pay billions of rands for set top boxes that will give South Africans access to the new digital television signals which we hope to get next year. Yet, the government does nothing to contribute to low-cost, high-speed access to the Internet.

The Department of Communications says that a telecoms policy review is underway and a White paper is expected some time in October this year. This White Paper is probably a good idea if only to add focus to the country’s embarrassing under-achievements in comparision with the smaller economies in Africa.

As the current broadband policy has achieved nothing of value for millions of people, we are left with the privately-owned operators whose only aim is to profit from Internet access and usage.

In the interim, Netflix is not ours to access, and may not be in the near future. Now that is a pity, as well as bad business metrics for the economy.

 

For abbreviated online version see 19 September 2014, Business Day Live, http://www.bdlive.co.za/blogs/finance/2014/09/19/blog

 

 

The illusion of regulation

In South Africa there seems to be an assumption that Pay TV broadcasters can expect to attract huge audiences and make hefty profits. This is, of course, an illusion. But both the Independent Communications Authority of South Africa (ICASA) and the newly-licensed broadcasters have eagerly bought into this illusion.

The question is: Will both reap bitter fruits of their wasted labours? ICASA creates the expectation that all is well in the Pay TV broadcasting sector. The licensing authority does so by inviting applications for Pay TV licences. It is not obliged to invite television broadcasting applications but it does so on the basis that competition best serves viewers and the industry.

More broadcasters create greater programming choice and drives down prices for consumers. Again, this is another illusion. While competition is sometimes an engine for greater choice and lower prices, the entry of more Pay TV broadcasters into a market dominated by the colossal DSTV does little to increase choice or reduce prices.

DSTV’s wide range of thematic channels, its exclusivity agreements with channel owners and its acquisition of programmes over a long period gives it a premier broadcasting status among viewers. Pay TV viewers demand the best and that’s what they can get from DSTV: the best international live sport programmes, the newest movies, digital animation, series, documentary, news channels and reality programmes. And, since the nineties DSTV has built up a formidable audience.

So what can the competition offer? Very little, if anything.

The important question is why ICASA has awarded licences in a sector of the market where the barrier to entry is now so high that the newly-licensed broadcasters are staring at a looming financial disaster even before they go on air.

But these broadcasters are not blameless, simply because they decided to respond to ICASA’s invitation to apply for the licences in a bloody market. Their responses were telling. They made huge efforts in their applications to show how deeply they believed in ICASA’s myth that Pay TV broadcasting is a market that will reward their labours – and hundreds of millions of investment rands.

So far the fall-out in the market had been disastrous. In 2006, ICASA awarded five Pay TV satellite licences. Only DSTV is making profit. Star Sat (formerly Top TV) is limping under a business rescue in the hope that the new Chinese investor will turn their fortunes. OpenView HD has moved into the satellite free-to-air market but is yet unable to match DSTV’s premier offerings. Of Walking on Water TV nothing is known. Sentech runs a small satellite free-to-air service based on a broadcasting licence ostensibly given under the now-repealed Telecommunications Act.

All this should have signalled to ICASA – and to interested investors – that something is not quite right and that perhaps some sort of intervention is necessary to lower the barriers to entry or to re-examine the need for more licences in the Pay TV market. But that is expecting too much from a regulator that appears unconcerned or unaware of its earlier mishap.

In May this year, the regulator licensed another five Pay TV broadcasters. Would ICASA have made a study of the Pay TV broadcasting market before inviting applications for these licences? It would be shameful if it did not. Such study would perhaps have averted further ruin for broadcasters or even caused them to be more realistic in their expectations when making financial decisions. Failure in the Pay TV broadcasting sector will only continue to erode further what’s left of the tattered reputation of the regulator.

To those of us unfamiliar with the arcane world of regulation (and of ICASA) the grant of the new licences is somewhat astonishing, and mostly confusing. Now flushed with the success of their applications the new licensees, beckoned by the myth of profit, are preparing to go live. New licensees have been granted to Close TV, Kagiso TV, Mindset Media Enterprises, Mobile TV and Siyaya TV.

They all say they’ve found gaps in the market and they’ve used the gaps in the market to build their plans for profit. Some say that they are bringing programmes from the East. They say that they will bring channels the competitor does not have. But what they do not know is whether viewers, wary of the failures in the market, will respond to their marketing.

A level of expected churn is the first problem. Expecting viewers to switch to your offering depends on many factors including price, the number of channel offerings and the quality of the programmes.

The second problem is whether there are sufficient numbers of terrestrial free-to-air viewers who can afford the new service. Most of the country’s TV households are still tied to terrestrial free-to-air broadcasting served by SABC’s three channels and e.tv. These viewers either cannot afford Pay TV or they do enjoy the programming fare on these services. The simple proofs are the high audience ratings of these channels and the airtime demand from advertisers.

E.tv’s success is an example of how a broadcaster broke the three-channel SABC monopoly over audiences and advertisers. E.tv successfully competes with SABC channels which demonstrates that this market is open to several new players.

It is in the terrestrial free-to-air market that ICASA should license new players, not in the Pay TV market. South African viewers should expect quality programmes in the terrestrial free-to-air market which should sustain a diversity of new voices. The licensing of the terrestrial publically-owned airwaves to private interests should not be used to entrench incumbents at the expense of diluting a wider and more varied media expression.

Since 1998 e.tv is the only new voice that has been added to the terrestrial free-to-air market which is greatly in need of new voices and new owners. Rather than licensing more services in the market which services the majority of the country’s viewers, ICASA spends its resources to give the illusion of greater choice and diversity in a market that services the rich.

So, ICASA makes merry by garnishing a market that adds nothing to the experience of the majority of the country’s viewers. It is ICASA’s illusion of regulation, a cheap trick, that disappoints broadcasters, and particularly the under-serviced majority of viewers. It may be that ICASA is ignoring its statutory remit to regulate in the public interest.

ICASA’s first round of Pay TV licensing failed miserably. So why does ICASA think that the second round of Pay TV licensing will succeed?

 

Abbreviated version published 22 August 2014, Business Day Live, http://www.bdlive.co.za/blogs/2014/08/22/blog-the-illusion-of-regulation

 

 

 

Fun of selfies take on a different hue when commercial rules apply

Treat others as you would your selfie


So- Called “selfies” are all the rage and are trending across the globe- and the high and mighty are not immune: witness the famed selfie featuring Danish Prime Minister Helle-Thorning Schmidt, UK Prime Minister David Cameron and US President Barack Obama at Nelson Mandela’s memorial service last December.

“Selfie” was named the word of the year 2013 and is now a word in the Oxford Dictionary. It is all part of the digital revolution, unless you are in the EU, that is, and the European Court of Justice’s “right to be forgotten” applies. EU citizens can request Google to delete a link associated with them. For most of the rest of us, the digital trail is our digital reality.

We should all pause as we look at the intellectual property implications of commercial exploitation and non-consensual use including public/celebrity and political figure endorsements.

The issues that demand attention – and are a potential minefield – relate to publicity rights, commercial endorsements and issues of ownership. In as much as selfies now trend on social media, the use of selfies on social media to transmit images and messages even of yourself, or which exploit public figures, is cause for legal concern.

The most famous case of a presidential embargo on selfies is not a surprising one: Samsung retweeted the selfie taken by US Boston Red Sox baseball world series champion David Oritz of himself and President Obama at an event at the White House. To all intents and purposes it was a happy and consenting US president who smiled into the camera when Oritz leaned toward him with his mobile phone in his outstretched arm. It was a joyous photograph and Oritz tweeted the photograph scripting: “ What an honour! Thanks for the #selfie, @BarackObama ”. Had that been all there was to it the tweet and photograph would have not attracted the ensuing backlash and legal, commercial and policy attention.

It just so happened that Orizt played the wrong ball at this moment and the US President and his staff were unaware that the phone had been provided to Oritz by Samsung as a promotional marketing endorsement campaign. Samsung retweeted the image with the Samsung trademark. This caused furore as US presidential policy which is akin to South Africa is that the President’s name and image cannot and was not to be used for commercial purposes.

From a legal perspective, in terms of US law, there was a smiling and consensual US president who is alleged to have said to Oritz as he leaned forward to take the selfie “ Oh, he wants to take a selfie “. In addition as both personalities are public figures it is unlikely that the US President has an action for breach of publicity rights. That is not the problem. The problem was the use of the photograph with the Samsung name, trademark and mobile. It is here that the company violated the presidential “no commercial use” rule as well as the US president’s rights of publicity.

Was this ambush marketing, commercial endorsement exploitation or lack of maturity on the part of the company?  All these factors need to be considered – but the fact is that it was a transgression as the image was retweeted and used inappropriately.

The purpose for which the image or likeness of a person is used is always important as are the circumstances with-in which use is made of the image.

The principle is quite simply that no one may use an image or likeness of another person without consent, for gain. While there is no innovation regarding selfies it is a timely reminder that in the internet and multi- media platform age where abuse are defamation are all too easy, people should be cautious.

Selfies are on the path to changing intellectual property rules in the digital world.

 

14 July 2014 Business Day, Business Law and Tax Review

Digital Rights Treaty

Why World Governments, Business and Citizens need a New Optional Protocol for Digital Rights

Adapting to the demands of the Digital World

The digitisation of technology is fast becoming the basis that underpins digital rights, digital privacy, digital communications and their intersection with law, social media, broadband and broadcast platforms. This has implications for business, government, education, health, transport, aviation, science, customs and trade, finance, infrastructure, development and philanthropy. Technology allows for the mapping of hitherto unknown territories as well as sustained forays into outer-space. The world as we know it has changed. The opening up of what used to be ‘deep space’ necessitates a strong digital computational framework.

In light of technology’s pervasive outreach and its pioneering role in invention and development which has both utilitarian and social implications, international law must be amended to align with these new realities. Ideally, this would be embodied in an Optional Protocol to both the United Nations International Covenant on Civil and Political Rights (ICCPR) and the United Nations International Covenant on Economic, Social and Cultural Rights (ICESCR), which are international treaties that UN member states accede to. By April 2014, the ICCPR and ICESCR had been acceded to or ratified by 168 and 162 countries respectively. Additional protocols to these covenants may have not been acceded to by all member states, as optional protocols are distinct documents requiring separate ratification.

For instance, one existing optional protocol to the ICCPR authorises the UN’s Human Rights Committee to consider “communications” from those claiming to be victims of state abuses, while another calls for the abolishment of the death penalty, but not all states have ratified these optional protocols.

The need for an international framework for enhancing technological rights has spurred the call for a Digital Rights Treaty as an appropriate way forward. An optional protocol would advance technology and infrastructure, while protecting digital privacy and the plethora of intersectional activities listed above. The protocol would also incorporate technological infrastructure for enhancing political, economic and social rights, thus aligning with the UN Charter, which seeks “to achieve international co-operation in solving international problems of an economic, social, cultural, or humanitarian character and in promoting and encouraging respect for human rights and for fundamental freedoms for all without distinction as to race, sex, language, or religion” art. 1(3)

But what about digital rights per se – is this a separate right or should digital rights be interpreted as a universal right available to all mankind? In addition, is the right to Internet a human right? These are some of the issues that the drafting team will have to engage with as it pitches digital rights onto the world stage.

What can an Optional Protocol achieve?

Since an optional protocol is a distinct document requiring member country ratification, it will engender visibility on the global stage and propel discussions on the need for technology itself, as well as for the governance of technology within the arenas of political, economic and social rights. This is likely to impel governments to consider up-scaling existing technologies as well as establishing infrastructure where none or little currently exists. Further, a protocol will catalyse deeper discussion of digital privacy, government and civil accountability, and the governance of digital privacy. Digital corporate governance and the use of technology for development and to digitise continents and countries, will also feature. A Digital Rights Optional Protocol is potentially a very powerful transformative tool.

Propelling this conversation onto the world stage is more likely to prompt leaders to ask the right questions in today’s warp-speed changing world and may induce them to consider a new optional protocol or even amendments to the existing covenants. This would accelerate a progressive shift to digital rights and governance and towards digital socio-economic development via Information and Communication Technology (ICT).

Digital rights are not a distant future ideal but a reality in our fast-paced and increasingly technological world. The time for a digital treaty is now. It affects all our rights, personal, creative, legal, corporate, governmental and juristic.

Our reality has changed.   Let us move with it.

See Abbrevaited version published : 9 June 2014, Business Law and Tax Review Business Day, South Africa

Parallel imported products

While legitimate, sellers of parallel imports are obliged under law in SA to disclose goods’ lack of warranties

Disputes on parallel imports will emerge as they hinge on differential pricing systems

PARALLEL imported products are legitimate manufacturer products that are brought into a country through unauthorised distribution channels and imported without the permission of the manufacturer, who is the holder of intellectual property.

They are not counterfeited or pirated products. They may have been and are sometimes purchased from legitimate cross-border third-party suppliers in different countries and brought into a country. They could also have been manufactured for distribution in a different country and brought into a country for resale.

Countries’ laws differ on the sale of parallel imports; it is allowed in some countries and not in other countries.

Parallel imported products, also referred to as grey market imports, cut manufacturing companies’ authorised distributorship channels’ return on investment. Hence manufacturers and their authorised distributors are disinclined and generally do not cover warranties for parallel imports.

Under South African law they are not obliged to cover warranties for parallel imports and a seller of parallel imports is obliged to tell you so. In fact, a parallel import seller must do so — conspicuously in terms of the South African Consumer Protection Act of 2008 which provides that “a person who markets any goods that bear a trademark, but have been imported without the approval or licence of the registered owner of that trademark, must apply a conspicuous notice to those goods in the prescribed manner and form”.

Parallel imports are legal in SA and in harmony with existing trademark, copyright and patent law in SA. Notwithstanding, we need to be mindful of ongoing debates about the principle of exhaustion of rights which limits a patent holder’s right. Once a patented product is sold, the manufacturer’s rights are exhausted by the act of first sale and subsequent resale of the product cannot be prohibited and the debate around whether permission of the IP holder should be obtained and whether the express consent requirement is restrictive.

It is worth considering that as a consequence of the exhaustion principle (no restrictions on subsequent sale), parallel importation prevents market segmentation and its attendant profit maximisation for a specific entity, hence manufacturers tend to be wary of parallel imports. Trade policies may have a different take and see the value of parallel imports in global trade and in creating a market for free movement of products.

Disputes on parallel imports will emerge as they hinge on differential pricing systems that affect the intellectual property holder’s rights. In addition, in certain sectors they may just as well invite competition as well as bring into play a range of potential antitrust issues. Parallel import disputes need to be resolved inter country as the agreement on trade related aspects of intellectual property rights, governed by the World Trade Organisation (WTO), does not allow for countries to bring parallel importation legal disputes to the WTO.

14, April 2014, Business Law and Tax Review