Universal Service through Rollout Targets and Licence Conditions: Lessons from Telecommunications in South Africa

A priority for the post-apartheid government was the extension of basic infrastructure services to the vast majority of citizens that were not serviced under apartheid. The Reconstruction and Development Programme set objectives for each of these utilities that would be achieved in the first decade of democracy, while departmental policy aimed to find means to achieving these targets. The strategy of choice in most sectors was one of ambitious rollout targets being set for utility operators. Targets were set for individual residential service (what we would term universal service) and for community service outside of individual homes (universal access). Whilst most utilities remained under public ownership, in telecommunications there was partial privatisation of the incumbent Telkom and the entry of privately owned mobile cellular operators. This paper examines how rollout targets and licence conditions for universal service have performed in this sector where private operators exist. It examines the failure of the Telkom licence and draws out some lessons for policy.