History made as Telkom, Rain win R2.7bn spectrum bids

Admire Moyo
By Admire Moyo, ITWeb's news editor.
Johannesburg, 08 Mar 2022

Telecoms regulator the Independent Communications Authority of South Africa (ICASA) says there is no legal impediment to the spectrum auction process which kicked off today.

ICASA today commenced with the opt-In phase of the auction process in line with its commitment to the licensing of high-demand spectrum.

This is despite facing a legal challenge from its licensee Telkom, which is disputing the spectrum auction process in a case set to be heard in April.

In a statement, ICASA says bidders submitted their bids in person between 10h00 and 12h00 this morning, and the bid evaluation was carried out in front of all authorised representatives following the close of the bid submission window.

Even though there were four bidders eligible to bid, the regulator says only three bidders submitted valid bids, namely Cell C, Rain Networks and Telkom.

ICASA points out the winners are Rain Networks and Telkom. Rain Networks will fork out R1.15 billion for two chunks of 10MHz spectrum in the 700MHz band, while the litigious Telkom will pay R1.5 billion for two chunks of 10MHz spectrum in the 800MHz band.

The chairperson of ICASA, Dr Keabetswe Modimoeng, encourages those that did not make the cut, not to lose hope but to continue supporting the process until the end.

“History has been made this morning and we are highly grateful to the participants during this phase. As stated in the invitation to apply, there can only be two winners this time around, and we encourage those who did not make it to continue supporting this process as it is only meant to benefit the country and its citizens,” says Modimoeng.

ICASA notes operators have been spectrum-constrained for a long time and the regulator has complete faith in this licensing process in that this much-needed stimulus output will translate into greater investment in broadband infrastructure and economic growth for the country.

“The licensing of this spectrum through an auction has major economic and social benefits for our country, especially during this time when the economy is emerging from the ravages of the COVID-19 pandemic,” says Modimoeng.

“This process provides a critical stimulus for economic recovery and has the potential to stimulate employment by leveraging ICT networks and digital platforms to deliver economic value for the South African society.”

ICASA notes the main auction stage will commence on Thursday, 10 March, using an online auction platform.

All six qualified bidders will be eligible to bid for spectrum in this stage between 09h00 and 17h00 during business days until the main auction stage concludes.

The authority says it has noted the latest developments in the review application filed by Telkom.

“The authority reaffirms its position that there is currently no legal impediment to the auction proceeding. As matters stand, Telkom itself is a participant in the process, and as per the outcomes of today, has emerged as a winning bidder in the opt-In auction.

“The authority remains committed to successfully completing the auction and will strongly oppose all efforts aimed at undoing the economic and social gains arising from the process.”