Elon Musk’s Starlink will not be coming to SA soon if comments by the Independent Communication Authority of SA (Icasa) chair are anything to go by.
Musk, appointed head of the department of government efficiency (Doge) by US President Donald Trump, has objected through Starlink’s parent company, SpaceX, to the 30% historically disadvantaged ownership requirement that SpaceX would be obliged to comply with were it to invest in SA. Since taking office, Musk has slammed SA for what he says are its racially discriminatory policies.
Several African countries rely on Starlink for access to the internet, especially in remote areas. Its satellites orbit closer to Earth than typical satellites, which increases the speed of communication.
Icasa this month held hearings on its proposed satellite services licensing framework. In a written submission SpaceX objected to the 30% ownership requirement. The pushback is part of a larger campaign against what Musk and others refer to as “woke policies” that include diversity, equity and inclusion initiatives, which they argue unfairly prioritise social justice over economic efficiency and individual merit.
Communications & digital technologies minister Solly Malatsi asked Icasa for its view on the introduction of equity equivalents as an alternative to the 30% ownership requirement in the Electronic Communications Act. He believes this will encourage foreign investors in the ICT sector.
“Policy clarity on the recognition of equity equivalence schemes has long been sought by players in the ICT industry. This will provide the certainty necessary to attract increased investment in ICT and accelerate universal internet access,” Malatsi said last year.
“After consultation with Icasa the proposed policy direction will be published for comment.”
The department of trade, industry & competition introduced equity equivalents into the broad-based BEE codes of good practice so multinationals do not have to sell a stake in their local operations to gain points on the scorecard.
Equity equivalents require companies to make social investments, for example in schools, clinics or community centres.
Malatsi said in an interview after a meeting on Tuesday of parliament’s communications & digital technologies committee that he had received Icasa’s response to the equity equivalents proposal, which was being considered.
We have the BBBEE council which has codes of conduct in terms of the ICT sector, and the Electronic Communications Act is very prescriptive ...
— Icasa chair Mothibi Ramusi
Icasa chair Mothibi Ramusi, who briefed the committee on Icasa’s role in reducing the cost to communicate, said Icasa had told the minister the introduction of equity equivalents in the telecommunications sector required a proper process and consideration.
First, he said, there were provisions in the Electronic Communications Act which would require amendment as it does not make provision for equity equivalents. A legislative amendment could take several months as parliamentary committees require public hearings on it.
“To align to anything new it has to be tested against applicable policies. We have the BBBEE council which has codes of conduct in terms of the ICT sector, and the Electronic Communications Act is very prescriptive that anyone who wants to participate in the ICT sector — that is telecommunications, broadcasting and postal — will need to conform to the 30% historically disadvantaged requirement.
“A deviation is something that is within the minister’s ambit to test the market. It doesn’t mean that if the minister says this is what you must do then we implement. It’s a process.
“As it stands right now we have never had an equity equivalent model within the industry that we regulate. This would be new if it were to happen.
“We are still doing our analysis. Now I can’t even say we agree or don’t agree. It is still a process that needs to be tested with the public. In terms of transparency this has to be tested out there. Let’s hear what the citizens are saying,” Ramusi said.
Funding model
Malatsi told MPs he was in discussion with the Treasury about the funding model for Icasa, which Ramusi complained about in his presentation, noting that Icasa retained nothing of the R14bn collected from the spectrum auction, all of it going to the fiscus.
In the 2023/24 financial year Icasa collected R8.2bn in fees but was only allocated R474m by government whereas employee costs amounted to R346m (73% of total costs).
Ramusi noted that amendments of end user and subscriber charter regulations were in the offing to address concerns regarding quality of service by mobile network operators. Icasa was consulting stakeholders on rules governing data expiry, data transfers, the longevity of roll-over data bundles and reasonable bundle transfer processes.
The amended regulation on call termination rates would come into effect on July 1.
Icasa would also undertake the second phase of the spectrum licensing process.
Competition Commission commissioner Doris Tshepe also briefed the committee on interventions to cut data costs and foster competition in the sector.
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