Achievement of the Achievement of the Objectives of theObjectives of the

Telecommunications Act Telecommunications Act 103 of 1996103 of 1996

HEALTH INFORMATICS SOUTH AFRICA CONFERENCE

MAFEKING

2nd to 5th MAY 2006

CHOSE CHOEU

South AfricaHome to 46 million people

…talking to each other…talking to each other

LEGISLATION

GREEN & WHITE PAPER AND THE TELECOMMUNICATION ACT 103 OF 1996

Promote The Universal And Affordable Provision Of Telecommunication Services

• Created the Universal Service Agency, to promote, facilitate and monitor the achievement of universal service and access in under-serviced areas, and also manage the Universal Service Fund

• Created and maintained the Universal Service Fund to implement subsidising access by needy persons to telephone services and provision thereof in under-serviced areas

• Licenced operators in various categories to increase the supply of services

Promote The Provision Of A Wide Range Of Telecommunication Services In The Interest Of The

Economic Growth And Development Of The Republic

• Licenced operators who have invested in infrastructure and telecommunications services

• Fixed line– Prepaid and postpaid services– ISDN and ADSL– Wide range of business and domestic products

• Mobile– Prepaid and postpaid services– GSM, GPRS, EDGE, 3G– >95% coverage of populated areas

• Infrastructure– Satellite and cable carriers internationally

Make Progress Towards The Universal Provision Of Telecommunications Services

Mobile operators coverage reaches >95% of population

Phone penetration >50% of population

– Fixed lines - 4 million– Vodacom - >10 million– MTN – 8 million– Cell C – 2.7 million

Licences issued for operators in under-serviced areas (i.e. teledensity below 5%)

Encourage Investment And Innovation In The Telecommunications Industry

Sector contributes 6% to GDP

Investment in telecommunications between 1997 and 2004 exceeds R 53 billion (US$ 9 billion)

Innovations include:– Prepayment vouchers– Wide range of tariff plans– Free “Please call me” SMS– Phone services for people with disabilities– Introduction of 3G– Aesthetic cell masts– Access to cellphone banking

Encourage The Development Of A Competitive And Effective Telecommunications Manufacturing And

Supply Sector

Global market structure restricts ability of small economies to

start up new manufacturing facilities

Local production facilities include:

– SIM cards (Namitech)

– Community Service Telephone units (Psitek/Siemens)

Significant growth in number of WASPs providing content

services and application services

Promote The Development Of Telecommunication Services Which Are Responsive To The Needs Of

Users And Consumers

• Wide range of products and services available• Prepaid vouchers• Free “Please call me” SMS• Speaking phones for people with disabilities• ISDN• ADSL• 3G• Internet accessibility• Public Internet Terminals• Multi Purpose Community Centres• Community Service Telephones

Ensure That, In Relation To The Provision Of Telecommunications Services, The Needs Of Local

Communities And Areas Are Taken Into Account

• Universal service and access policy supported by Universal Service Agency and Universal Service Fund

• Introduction of special licences for operators in Under Serviced Areas

• Placement of 65 telecentres

• Placement of Community Service Telephones (e.g. 36000 installed by Cell C, 24000 by Vodacom)

• Acquisition of computers/networks for under-serviced schools

Ensure That The Needs Of Disabled Persons Are Taken Into Account In The Provision Of

Telecommunication Services

• Speaking phones for blind/partially sighted customers• TTY loopset to assist users of analogue hearing aids• Implementing “specific needs” call centre at Vodacom• Interactive billing facility for blind/partially sighted users• Product and service information available in large print

and on audio tape• Public telephones placed at height accessible from

wheelchair• Wheelchair ramps to access CSTs• SMS-only contracts

Ensure Compliance With Accepted Technical Standards In The Provision And Development Of

Telecommunication Services

• Independent Communications Authority of South Africa

(ICASA) responsible for technical regulation of licenced

operators and compliance with ITU standards

• Standards South Africa (SSA) involved in setting technical

standards in accordance with international practice

• Mobile operators comply with international specifications

(GSM)

Ensure Fair Competition Within The Telecommunications Industry

• Mobile industry characterised by strong competition

– Vodacom, MTN, Cell C

– Confirmed by Yankee Group study

– Rapid and sustained growth

– Real choice for consumers

– Regulator monitors business practices

• Fixed line monopoly terminated in 2005 by licencing of Second National

Operator

• Telkom response to mobile competition with lowered tariffs and flexible

pricing

• Competition Commission role ensures fair play

Promote The Stability Of The Telecommunications Industry

• Institutional framework provides certainty, mandates

regulatory restraint and provides for independent regulator

• Market structure governs who can be licenced and for how

long, sets time frame for liberalisation

• Regulation of market activity encourages competition and

limits intervention

• Spectrum and number allocation assigned fairly

• Fair and reasonable imposition of fees and obligations on

licensees

Encourage Ownership And Control Of Telecommunication Services By Persons From Historically Disadvantaged Groups

• MTN 23.5% BEE ownership

• Telkom special placement of shares

• Vodacom 50% owned by Telkom

• Cell C 25% BEE ownership

• USALs required to be BEE enterprises

• SNO >19% BEE ownership

• Phone shops

• Sentech owned by the State

Protect The Interests Of Telecommunications Users And

Consumers

• ICASA mandate includes consumer protection

• ICASA outreach program to educate consumers

• Recent ICASA investigation into contract periods

Encourage The Development Of Human Resources In The Telecommunications Industry

• Significant investments by vendors and operators in training technical skills

• Programs initiated by Information Systems Electronics & Telecommunications Technologies Sector Education & Training Authority (ISETT SETA) funded by Skills Development Levy (SDL)

• ICT Sector Jobs Summit initiative through the National Economic Development & Labour Council (NEDLAC)

• Reskilling and enterprise development programs implemented by Telkom during rationalisation process

Promote Small, Medium And Micro Enterprises Within The Telecommunications Industry

• Community service telephone franchise operators

• Under serviced area licensees

• Phone shop operators

• Kerbside phone services

• Prepaid voucher sales

• Enterprise development in procurement process

Ensure Efficient Use Of The Radio Frequency Spectrum

• ICASA mandate to manage and licence use of radio spectrum

• 900 and 1800 bands used for mobile telephony

• In accordance with global practices

Promote The Empowerment And Advancement Of Women In The Telecommunications Industry

• ICT Sector Jobs Summit• ICT Sector BEE Charter• USAL conditions• Example: Women as % of Board Directors:

– MTN 23%– Vodacom 8%– Telkom 9%– Sentech 36%

All specifically promote interests of women

All specifically promote interests of women

Final Scorecard

??

The Local Software EconomyCompiling hours into millions

Roles in the Software Ecosystem

GovernmentEnterprisesSoftware Industry LeadersAcademiaInvestorsLocal and International MarketsEntrepreneurs & LabourOthers including …

– Parents– Mentors & Coaches– Role models

Key Role Players In The LSE

EnablersEnablers

ConsumersConsumersProducersProducers

Core of the Ecosystem•GovernmentGovernment•AcademiaAcademia•InnovatorsInnovators•Entrepreneurs & Entrepreneurs & InvestorsInvestors•Technology VendorsTechnology Vendors•Large EnterprisesLarge Enterprises

Key LSE Indicators In SA

Skills capacity ~ 33,000 prof. devs.

Software consumption ~ R15bn

Govt adoption of ICT’s for e-Gov

Software production ~ R8bn

Software export ~ <R1bn

Venture capital support of software businesses ~ <R600m

Key Innovation & Skills Capacity Indicators In SA

Doing WellQuality of graduatesEducation policy

frameworksResearch Activity Internships and Skills

Development Policies

Needing Attention? # of graduates? Diversity of graduates? Skilled Educators? Attraction to ICT? Investment from Idea

to Incubation

LSE’s Rated & Ranked

Sweden

France

Norway

Israel

Finland

Austria

Ireland

Brazil

Hong KongItaly

New Zealand

China

Hungary

India

Greece

Malaysia

Thailand

Turkey

Bulgaria

Egypt

Japan

United States

United Kingdom

Germany

CanadaAustralia

NetherlandsSwitzerlandDenmark

KoreaBelgium

Spain

Taiwan

Czech Republic

Singapore

South Africa

Russia

Mexico

Poland

Portugal

Romania

Philippines

Saudi Arabia

Indonesia

Vietnam0

2

4

6

8

10

12

14

16

0 2 4 6 8 10 12 14 16

Supply Score

De

ma

nd

Sc

ore

STAGE 1

STAGE 2

STAGE 3

STAGE 4

STAGE 5

STAGE 6STAGE 7

Relative to others within the same tier, countries below the grey bar tend to produce more software

than they consume

Relative to others within the same tier, countries above the grey bar tend to consume more software

than they produce

Key Drivers:Key Drivers:

•Abundance of relevant skills

Abundance of relevant skills

•Innovation – Incubation - Investment

Innovation – Incubation - Investment

•Govt and Private Sector Procurement

Govt and Private Sector Procurement

•Policy’s and Frameworks

Policy’s and Frameworks

•PC Penetration & Internet Access

PC Penetration & Internet Access

•Export Revenues

Export Revenues

• … … attractive to VC’s and R&D ($$$$$)

attractive to VC’s and R&D ($$$$$)

Copyright Microsoft 2006Copyright Microsoft 2006

ResultsResults•Revenue Growth ($$$$$$$$)

Revenue Growth ($$$$$$$$)

•Market GrowthMarket Growth

•ExportsExports

•Leverage Intellect (IP)

Leverage Intellect (IP)

•Focussed Excellence

Focussed Excellence

•Established Reputation

Established Reputation

•Brand & IdentityBrand & Identity

Leverage consulting into productConverting hours into millions

ISVISVCapabilitiesCapabilities- $ Multiplier$ Multiplier

-SustainabilitySustainability-Employment EngineEmployment Engine

InputsInputs•TimeTime

•IntellectIntellect

• $$$$

•Govt & Corp SpendGovt & Corp Spend•InvestorsInvestors•Tech VendorsTech Vendors

How do we address this challenge?

Skills creation

Public-private partnerships

Policy frameworks

Support & Incentives for Entrepreneurs

Incentives for Patent and Production

Encourage creation of software product

Publicise the successes to inspire others

And …..

What is Microsoft doing in Academia?

Project Firefly – “Let your potential shine”

– www.projectfirefly.co.za

– 1500 participants

– 30 departments

– 350 projects

– Winners to India for Imagine Cup Finals

– 5 Competition categories• 70% of departments teach MS technologies

• Research grants and affiliations to MSR

• Faculty days and curriculum material

• Helping more scholars into ICT field

What is Microsoft doing in SA?

Creation of Software Product

– Renewed and Updated Partner Program– ISV Empower

• > 180 Active Registrations• 15 “graduations” to Certified Partner Program

– Revitalised and Improved Partner programme– Local resource for software globalisation– 800 ISV businesses in the country

• more than 80% are on Microsoft technologies

– Working with govt and large enterprise to drive ISV successes

What is Microsoft doing in SA?

Public Private Partnerships– Dept. of Science and Tech & CSIR– Dept. of Education

• Schools, Universities and FET’s– Dept. of Labour

• ISETT SETA– Business Incubators

• Several country-wide– Local and Provincial Govt’s

• JCSE with Partners & City of Johannesburg• Microsoft Innovation Centre for ISV’s in Africa with

partners & City of Durban at SmartXchange• And more to come …

What role can you play?

• Partner with us in this effort

• Educate to empower

• Responsible development

• Responsible procurement

THANK YOU