Broadband in the Republic of South Africa: Politics, Regulation and Service Delivery

South Africa has performed poorly in delivering broadband to its citizens, with very limited access and little effort to boost its adoption. It compares badly to the BRICs and to other comparable nations, while having lost its position as African leader. The African National Congress (ANC) government has emulated global best practice, but inappropriately and often for show. Additional state-owned enterprises were created to increase governmental involvement in broadband markets. Never trusting the idea of an independent non-majoritarian regulator, the ANC undermined its effectiveness, denied its legal mandate and forced commercial operators to come in person to ministers and officials for clarifications and permissions. It created legal confusion through overlapping powers of the regulator and the competition authority which was exploited by the state-owned incumbent operator, Telkom, through forum shopping and protracted litigation. Limited competition in mobile telephony easily outperformed the fixed voice network of Telkom in delivering near universal access and adoption. Similarly, mobile seems to be beating fixed broadband, because it is accessible and affordable. Local loop unbundling has been promised for years, but not yet delivered, despite commitments made to prospective fixed operators, provisions in legislation, consultations by the regulator and an official inquiry. The debate remains active in 2012, despite its technological obsolescence, diverting attention from the need for investments in optical fibre. In a unique instance of clarity, a court overturned a government decision limiting the self-provision of infrastructure by service providers, significantly opening the market. Previously, Telkom had behaved anti-competitively against value-added network service providers.The policy process has been deeply flawed, with ambitious targets adopted but never delivered. The government asserts it must be involved, despite the evidence it cannot or will not deliver and that properly regulated markets will.