By Daniel Pretorius,Sinenhlanhla Dlamini Monday, August 07, 2023

On 31 July 2023, the Department of Communications and Digital Technologies (DCDT) published the Draft White Paper on Audio and Audiovisual Media Services and Online Content Safety: A New Vision for South Africa (Draft White Paper), available here.

The Draft White Paper seeks to address the changes brought about by the digitisation of the world through the internet of things, cloud computing and storage, artificial intelligence, robotics, and advances in nanotech and biotech. The objective is to ensure that these developments do not perpetuate the disparity in access to ICT by widening the digital divide. The Draft White Paper aims to do this by providing inclusive audio and audiovisual content services (AAVCS) to all South Africans in a manner that promotes socio-economic development and investment.

The Draft White Paper overhauls the current broadcasting licensing regime by, among other things, replacing the currently defined concept of ‘broadcasting services’ with ‘audio and audiovisual content services’. The effect of this is that over-the-top service providers such as Netflix, Amazon Prime Video, Disney+, and Showmax will, in future, require licences to operate in South Africa. 

The Draft White Paper envisages legislative provisions for a transitional framework for the conversion of existing licences to the new AAVCS licensing framework. In the proposed licensing framework, the regulator, the Independent Communications Authority of South Africa (ICASA) will continue to issue individual and class licences, as under the current system. A broader category of AAVCS licences will replace the current broadcasting services licence category.

Certain types of AAVCS may be exempt from the obligation to obtain a service licence. In the case of on-demand content services (OCS) that target South African audiences, the entry threshold requirement to hold a class licence will be set at an annual turnover of ZAR 50 million in the previous fiscal year.  Below the entry level threshold, an OCS will be exempt from having to apply for a licence. This category of licence will apply to OCS, including those offered on the public internet. It is intended that OCS available on the public internet will be exempt from licensing requirements.

ICASA currently considers various factors when granting an individual licence, including the licence applicant’s previous year's turnover. Similarly to section 5(3)(e) of the Electronic Communications Act 36 of 2005, the Draft White Paper allows ICASA to introduce other socio-economic criteria or audience size measurements.

Even if a licensee falls below the ZAR 100 million threshold, it might need to apply for an individual licence based on these factors. This threshold also applies to foreign AAVCS that target South African audiences and generate revenue through advertising, subscriptions, or other means. If the size of the international business can impact the economy, ICASA can issue a licence regardless of its South African turnover.

As key drivers of the reform, the Draft White Paper identifies a need to level the playing field between traditional broadcasters and over-the-top on-demand service providers, and address the inability of the current legislation to adequately regulate modern and complex digital technology.

Cabinet plans to adopt the final white paper by 31 March 2024 and the DCDT confirms that, following Cabinet approval, the drafting of the proposed legislation will get underway in the 2024/25 financial year.

Comments on the Draft White Paper may be emailed to the DCDT at WP[email protected] by no later than Friday, 8 September 2023.