Guy Berger Rhodes University 2 -4 February 2006

Guy Berger, Rhodes University 2 -4 February 2006 “The evolution of the media through convergence”. “Dialogue between telecom and media regulation stakeholders in times of convergence: challenges and prospects for Africa”, Cotonou, Benin, Panos Institute West Africa

Looking ahead… Scenario thinking: • “We overestimate the changes that will occur in 2 years, but we under-estimate those in 10”. - Pete Rinearson • Eg. CD in 2016?

Coming up: 1. 2. 3. 4. 5. 6. 7. 8. Origins Converging industries Device convergence Production convergence Money and mergers Impact on regulation Policy, law and regulation Conclusion

1. ORIGINS

Currency of a term: • • • The word arose in the 1990 s. Part of the wave of the Internet Hype came with $$ signs …& went… Yet Internet continues to expand. Some aspects are slowly becoming commmercially sustainable. • Convergence is coming of age.

Convergence outgrows the Net • Convergence today is not just about Internet – it impacts on the “old” mass media. • As convergence grows, stand-alone & single media enterprises will not survive. • = sustainability challenge to a small newspaper or radio stations AND to cumbersome state-owned broadcasters. • Convergence affects ALL media: big/small, old/new, local/global, physical or electronic, profit/public-service, individual/institutional

Concept: • Convergence simply means the coming together of formerly separate things. • But: “We are virgins” about “convergence” • The complication is that it covers lots of processes …

Foundation & floors Culture Finance Regulation Production+distrib Devices Media sector ICT sector Technology

2. INDUSTRIES CONVERGE

1. Ways of seeing … • • • Services: Telecoms – voice & data Media: content on many platforms Focus: changing core business (eg. Google) Corporate: mergers and alliances Devices: fax-copier, camera-phone, phone-pda, PC-TV • Mobile & fixed (note wireless ≠ mobile) • All are due to DIGITALISATION

Converging tech, services, devices Note: Management Data Networks Between AND Within Broadband Network Wireless IP PSTN Enterprise Laptop Voice Content Camera Mobile Device Service i. Pod Video Data PDA Credit card Phone Broadcast Source: Telkom

A global network of signals • Convergence means linking and merging in a common, integrated, system… • But it’s NOT 100% seamless – there are different technical standards, languages, cultures, platform strengths. Therefore, differences persist. THUS: • Convergence = patchwork of connections. • NOTE: divergence does not disappear!

History: once upon a time

Computers infiltrate

Internet is born: What was seen as a voice network grew to include data distribution between computers

ICT&Telecom business blur § EBay buys Skype § Google also into VOIP

Two principles operating Many to Many comms (P 2 P) begins to emerge Traditionally: 1 to 1 comms

The media gets interested ? ?

Media joins the party … internet

Adding a different principle many to many comms internet 1 to 1 comms 1 TO MANY = MASS COMMS

Using Internet for “new media” TRIO now offers all 3 principles of comms: Eg. TV broadcasters display audience SMS

Question? § Media joins the party – but … § As an equal player – or, § As subordinate to the Telcos? Or ICT companies – (eg. Google News)? § Who moves the most? And takes over/on the character of the others in the process?

But there’s more … • Prominent in “media” is Broadcasters now transmitting content by telecoms. • This is sending audio & video via cables (wired) on the WWW – streaming or downloadable. NOW: the wireless WWW is fast extending where & when this content can be accessed.

And more … • There is also growth in non-WWW wireless publishing via GSM & 3 G (SMS, MMS). i. e. It’s convergence, but not IP-based! • Plus there are non-broadcasters pushing “broadcasting” content on telecoms! Individuals, firms, political parties, telco’s… • = Very different from the previously separate worlds of Telecom, IT and Media! • = BIG competition for Satellite!

Eg. Vodacom - 3 G SA cellphone firm now offering: $2 a day access to Mob. TV– E! Entertainment, Fashion. TV, Uefa Champs League, Sky News, Fox, Yebo Entertainment, Mini-soaps (eg. Sunset Hotel). Telkom SA – doing trials on subscription TV via broadband cables.

And yet more … • Besides mobile. TV on 3 G, there’s also: IPTV (via wired or wireless Internet) • Yet, there is not only Telecoms and Broadcasting convergence … as important as this is. • There’s also convergence within the Media sector – eg. between Print & Broadcast, and Radio & TV. (esp USA)

Plus …convergence: • … between real-time transmission (traditional broadcasting) and timeshiftable content (used to be only with tapes, records, newspapers). = (PVRs, Video-on-demand – which kills watershed hour regulation). • … between content push & pull directions (= interactivity) • … between consumers & producers.

What goes at the Centre? Digital Camera Computer Scanner Inkjet Printer x. DSL Access Point Home Audio System MP 3 Player PDA Cell Phone Cordless Phone Base Station

The Centre is variable! Digital Camera Computer Scanner Inkjet Printer x. DSL Access Point Home Audio System MP 3 Player PDA Cell Phone Cordless Phone Base Station

Viewpoint: Mass media

Other new media exploited

Print & broadcast blur

Dog and tail • • Which platform is primary in general? Who moves towards the other? Who wags what? In the whole converged media pack, what platform is top dog? • In a given media company, what is the primary platform? • What when “alien” players intrude? • Do we “protect” old media (PBS, National Telco) – or should they have to compete fairly with others?

Summing up: • Telcoms and IT industry create Internet. • Media industry joins the party, mainly with Internet, but also other new ICTs. • Lines within the media industry itself start to blur. • New competitors all-round: (eg. BT to buy ITV? ; BSky. B already bought ISP Easynet)

3. DEVICE CONVERGENCE

On the consumption side • Questions: – Top connected device: PC or TV? Lean forward or back? – Convergence of Cellphone & Laptop/PDA? – True multi-media converges text, audio, etc. – Will it be “killer app”, killing off mono-media? • Answers: – Devices multi-functional – Divergence survives

Web didn’t kill “old media” star • Divergence PLUS Convergence = future

There will still be times when: • Solo sound is sought after, • It will be most efficient to communicate with text & still photographs, • Couch potatoes will still want to have unidirectional AV content

Looking ahead… • Content may arrive on handhelds, electronic paper, smart TV, PC, fridge, car, clothing … • It may ride on wired or wireless signals, and via Internet or non-IP technologies. • In Africa 2016, volumes of content will come by cellphone: – Consumers increasingly have the device – There is a viable pay model in place – unlike content distributed via the Web.

Difference … • New stuff will still fullfil classic functions of radio, TV, print • But: content will be convertible between text, sound & image • And: Some content will be blended as multi-media, where whole is greater than the sum of parts • Plus: Much will be interactive.

Movable feast • Devices will offer fixed and mobile access. • Global trends: Σ content, any time, any place … at a price. (What about Universal Service? ) • Ubiquity and speed of info will be hallmarks of Info Society.

Summing up: • Convergence does not annihilate all differences between devices/platforms, • But it boosts inter-media co-operation: – Old – New – Old – Producers – Consumers. • Requires portability & open access. • Multiple platforming ahead.

4. PRODUCTION CONVERGENCE

The re-making of media … • Media as a sector: –Distribution convergence: • Content re-purposing –Production convergence: • Database publishing • Multi-skilling • Archiving

Organisational: 1

Organisational 2

Organisational 3

Evolutionary levels: • Level one: Media sector sharing content across platforms. • Level two: Media sector sharing production across platforms – with increasing integration of newsrooms. • Level three: Converged ownership?

5. MONEY & MERGERS

Drivers of convergence… History of Internet growth was due to US military, pornography, e-business. = irony: gives Africa ICT 4 D & Democracy! BUT: “The mere fact that convergence is a technical possibility does not explain why convergence is taking place now” - Hoogenboezem

Economic drivers • Produce once, publish countless times Content is costly to produce – Cheap to reproduce electronically – Repurpose for different platforms. • Background of: – Fragmentation of audiences – Increased competition for advertising – Global and niche opportunities

Digital economics • • Intellectual Property vs Commons Editorial integrates with Adverts E-commerce convergence into media Subscription, pay-per-view Customisation Data-mining (consumer rights? ) Cross-promotion & branding

Value chain elements: 1. Content (origination, production) 2. Services/applics (content packaging and design) 3. Transmission/delivery (eg. ISP, satellite, cable, mobile, wireless, broadband) 4. Consumer devices (eg. decoder, tv, pc, mobile, pda)

Value chain today: • Old: –Content creators + owners –Platform owners –Audience (Ads/Subs)

Tomorrow: overturned? • Now, SABC pays Sentech (signal distributor) to deliver its broadcast. In future, Sentech may pay SABC for the content it seeks to deliver. • Now, Johncom (newspapers) pays Telkom for bandwidth to deliver Internet content to customers. In future, Telkom may need to pay Johncom for content to run on its pipes.

Content folk in new food chain: • New: channels & carriers dominate? : – Platform – Content creators + owners – Audience • New: connectivity cheap, content? ? ? • New: disintermediation: – Advertisers Audience (bypass Media) • New: consumers becomes producers: – Audience P 2 P (& blogging).

Summing up: • Value chain is changing • More platforms • More producers, incl audience = More competition

Convergence & monopoly • “Significant Market Power” becomes an issue – Eg. Interconnect & common carrier status. • Consumer Protection: – Tariff controls when there’s monopoly? • Child protection: – What to do about porn online & on cellphone?

6. IMPACT ON REGULATION

Who may do what, and how Some Mass Media Areas: Newspapers Radio TV Telecoms Internet ISPs Degrees of control: REGULATION SELFLAISSEZ (eg. Licensing, REGULATION FAIRE censorship, (industry, (market, police) codes of citizens, conduct) parents)

SA regulation: back then …

Regulatory convergence: now …

Regulatory convergence: tomorrow?

SA 2005: Govt power • Policy directions - Telecoms: – ICASA must follow everything. • Policy directions – Broadcasting: – Limited to broad issues and to: • Radio frequency spectrum • Local content • Universal service coverage targets – ICASA must consider any policy direction issued by the Minister

SA 2005: Regulations • Making regulations - Telecoms: – ICASA regulations must be approved by the Minister • Making regulations – Broadcasting: – ICASA make regulations (not local content) – No requirement of Ministerial approval. • Regulator council appointments issue. • What power set-up prevails with convergence?

Complications for 2006: • New ministerial power – unconstitutional? • Licensing Content Producers? – Will SABC need licence to broadcast through other means? Eg. Via Wifi spectrum? – Offshore originators? Businesses? Individuals? • Consumers? – Need to pay TV licence for viewing via PC or cell? • Owners? – Cross-ownership? Foreign ownership?

2006: Tech Neutral regulation? • Should all (and any) channels equally attract: – Local content/ownership obligations? – Universal access? – Language mix requirements? – Electoral balance? • Or should it be specific providers (eg. SABC, community broadcasters) who have conditions, irrespective of channel? • Desirability of content regulation? Practicality?

Regulate the regulatable? • • • SA: 250 000 movies, 11 m web pages Heavy touch vs light touch philosophy Penetration & scale as issues Joint regulation, self-regulation Active vs passive (fetch vs push) Media literacy & parental regulation?

SA: draft licence categories 04 • Network facility provider: – cables, transmitters, satellites. • Network service provider: – bandwidth, broadcasting. • Application service provider: – telephony. • Content applications provider: – various broadcasters.

SA: final licence categories 06 • Network facility provider: – cables, transmitters, satellite transponder. • Network service provider: – transmission systems • Electronic Comms service provider: – (excl Content Providers; Broadcasting) • Broadcasting service (Unidirectional) • Radio frequency licenses

Summing up: • • • A single regulator logical, but… Practicalities and complexities What model of power prevails? “tech neutral”, but not with classic broadcast! Regulating channels and/or providers? SA 2006: Licences for infrastructure, some services, but NOT for applications or content.

7. POLICY, LAW, REGULATION

Transition from “a” to “b” … • Current licences were service-specific as well as technology specific: Telecomms Broadcasting - PSTS - Free to air TV - VANS - Free to air radio - Mobile - Signal distribution Aim: to licence different parts of comms chain. Pressures of opportunity-cost led SA Govt to rush

New SA laws now immanent • Three year process replacing the old: – Icasa (regulator) law – Broadcasting laws – Telecom laws • Convergence Bill -> Electronic Comms Act • Icasa Amendment Bill • Problem: Lack of policy and process

Culminates in 2 draft bills No definition of “convergence” → major rewrite Final law is very different to earlier Bills!

Internet services Value added services Cellular services Telecoms services Free to air Radio Free to air TV services Former Approach to Licensing This kind of old licensing = limited competition.

Now - horizontal Content Everything that can be conveyed across network Exempt Applications Communication Service Communication Network Prepares content for conveyance across networks Conveyance of content across a communications network Class Facilities/transmission Individual

Bill’s classes of licenses • Individual licences – Network services – Frequency spectrum licences – Broadcasting licences • Class licences – Communications services • No licences needed – Content producers • A huge challenge for the Regulator to interpret what counts as services and applications.

Summing up • • Very complex transition. Rushing convergence is false speed. Separate policy and law-making phases What principles should guide the Regulator in interpreting the law? • There are longterm issues at stake – tech up-take, competition, investment, culture, freedom…

8. CONCLUSION

Not end of story…media role

SA: weak coverage 60% reports did not define convergence • Many reports 65% gave no come from press background releases & official sources • 80% didn’t question/crit their sources

Highway Africa study (Catia) Kenya Mozambique DRC Nigeria Ethiopia Senegal Finding: Media silence re: • Info Soc agenda-setting, • policy debate & formulation, • implementation, • monitoring, • review.

Press, Policy, Regulation • Convergence law & regulation in parts of Africa but sans prior policy to guide it. • Let alone a policy framework that includes input from stakeholders in society. • If media & regulators collaborate, they can highlight the debates & explicate issues. • Give media regular briefings! • Let informed coverage bring public interests & wisdom into the policy picture.

Organised convergence!

Merci! Thank You Berger, G. 2001. Configuring Convergence. http: //journ. ru. ac. za/staff/guy/fulltext/nrfboo 8 kisbn. doc Online column: www. mg. co. za/converse Highway Africa 10 th conference: 11 -13 Sept – regulators more than welcome!