Sentech will have to make use of its spectrum in the 2.6GHz band, or face losing it, says Independent Communications Authority of SA (ICASA) chairman Paris Mashile.
Speaking during a panel discussion at yesterday's Internetix 09 conference, Mashile explained the regulations that will come into practice will allow operators a fixed amount of time to put the scarce spectrum to use, before ICASA takes it away.
Sentech was allocated a large chunk of the hotly contested 2.6GHz band, which is commonly used for mobile network technologies like WiMax, or LTE. The state-owned business is sitting on 50MHz in the band, which was intended to be used for its MyWireless service.
Late in 2007 and early 2008, government and Sentech made several promises to get the WiMax service off the ground. When little progress was forthcoming, National Treasury criticised the company for squandering R500 million on the service.
In September last year, government made “a strategic decision to phase out MyWireless” from Sentech's arsenal of products and the spectrum remains unused. Telkom and Neotel were also allocated spectrum, leaving only 126MHz for new entrants.
Under the current draft regulations, the remaining spectrum will be allotted in slots of 30MHz, leaving only enough spectrum for four additional players. The scarcity of the resource has had many operators question Sentech's validity to hold the licence to the allocation.
During the Internetix panel discussion yesterday, former Vodacom CEO Alan Knott-Craig said: “Take the spectrum away and give it to someone who can use it. They have been sitting on it for a long time. How many decades do you need to prove that they are not using it?”
Firm stance
During a recent media briefing on ICASA's draft regulations of scarce spectrum, Mashile explained the regulator would have a use it or lose it approach with operators that are not being efficient with their allotted band. However, the regulator was reluctant to commit to taking spectrum from Sentech, saying it is a “political issue”.
However, Mashile made a commitment yesterday that Sentech would have a specific timeframe to use the spectrum, or face the penalty. “Sentech was allocated that spectrum in a different era. But we are reaching a point where they will be given a period of time in which to make use of it.”
There is an industry movement which holds the companies that have already been allocated spectrum should not be eligible to apply for additional frequencies. “I don't want to get involved in that war,” noted Mashile.
While the incumbents hoard their allocated spectrum, they will also not be excluded from applying for what is left. Mashile explained the regulations are clear and the parameters to apply are neutral, meaning no company will be excluded.
Lucky few
Several companies would welcome the spectrum and some, like Internet Solutions (IS) and MWeb, already have a small part of the technologies in place to run a WiMax network.
While IS CEO Angus MacRobert will not say whether the company would apply for a part in the remaining spectrum, he says the company has not ruled out the possibility. “There is a good chance we will apply for the spectrum. We just hope that the fees will not be exorbitant.”
The draft regulations lean towards a “beauty pageant” to determine whether a company is eligible to apply. Companies will first need an ECNS licence, which most already have. Operators will also have to prove a 30% black empowerment shareholding, a far cry from the last draft which called for 51%.
Spectrum in the 3.5GHz range will be allocated on a regional basis, primarily to municipalities and metros. Each region will be allocated two blocks of 28MHz each.
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