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ICASA bags R14.4bn from SA’s historic spectrum auction

Admire Moyo
By Admire Moyo, ITWeb's news editor.
Johannesburg, 17 Mar 2022

Telecoms regulator the Independent Communications Authority of South Africa (ICASA) has raised R14.4 billion from the country’s historic spectrum auction process, which kicked off last week.

In a statement, the regulator confirms the successful conclusion of the much-anticipated high-demand radio frequency spectrum auction today.

The auction involved six qualified bidders: Cell C, Liquid Intelligent Technologies, MTN, Rain Networks, Telkom and Vodacom.

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

According to ICASA, the revenue collected from this auction totals more than R14.4 billion, which will go to the national fiscus.

It says this is the total amount generated from the opt-In phase auction, which took place on 8 March, and the main auction stage, which commenced on 10 March and concluded today, 17 March.

The main auction stage comprised 58 rounds of bidding between the six bidders.

The authority further confirms there was one unsold spectrum lot of 2x10MHz in the IMT800 band. This lot will still be licensed by the authority in future, says the regulator.

ICASA had set itself a target of R8 billion from the proceeds of the auction, which has been up in the air for some years.

ITWeb reported yesterday that communications minister Khumbudzo Ntshavheni hopes her department will benefit from the billions of rands in proceeds of the long-awaited high-demand spectrum auction.

The allocation of high-demand spectrum by means of an auction is key among the South African government’s economic structural reforms, as the state looks to boost the fiscus.

For mobile operators, the last big set of spectrum issued was in the 2.1GHz band, which helped the operators in their 3G network deployment.

Unlike its African counterparts, South Africa was one of the few countries that had not allocated 4G/LTE spectrum on the continent.

This forced local operators to improvise with spectrum re-farming and carrier aggregation.

With the successful spectrum auction, it is expected South Africa’s mobile operators will be able to expand next-generation technologies such as 5G, while the process will also result in the prices of mobile data going down.

ICASA notes the next stage in the auction process will be the assignment round, which is purely an administrative process and will be held on Tuesday, 22 March, to determine the actual spectrum ranges to be assigned for all the lots bought in the various bands.

ICASA chairperson Dr Keabetswe Modimoeng.
ICASA chairperson Dr Keabetswe Modimoeng.

The chairperson of ICASA Dr Keabetswe Modimoeng expresses his gratitude to all the bidders for their cooperation and participation in the auction.

He further expresses his utmost gratitude to the government of the Republic and the entire South African society for their support throughout this complex process.

“This was our inaugural radio frequency spectrum auction, and we are really grateful to have reached this stage without any hassles and challenges from the first day of the actual auction to date. This shows South Africa’s capability as an investment-friendly destination,” says Modimoeng.

The chairperson further thanks all ICASA staff members who were actively involved in this process for their stamina and commitment to ensuring this licensing process completes successfully.

“These members of our staff did this for the country, and they must be hailed for the successful conclusion thereof. We look forward to all South Africans benefitting from the dividends of these regulatory interventions, and to seeing the proceeds of the auction being put to good use for the benefit of all South Africans. This auction was indeed in the best interest of all South Africans, as will be the subsequent licensing interventions post government’s revision of the wireless open access network policy,” concludes Modimoeng.