Mobile operators have contended that a proposal in the draft radio spectrum regulations for a five-year renewal cycle would create uncertainty, and by extension, undermine future investment in the sector.
This was a general issue of contention, according to telecoms players who presented oral arguments in terms of the draft regulations before the Independent Communications Authority of SA (ICASA), in Sandton, yesterday.
However, ICASA councillor and chairperson of the committee heading up yesterday's hearings, Marcia Socikwa, hit back, saying the contradiction of the operators' arguments was mesmerising.
She said currently the operators are required to renew their licences annually and that a five-year cycle was an improvement. She said ICASA had given operators a hand and now they wanted the whole arm.
The draft regulations state the authority would reflect on the technological cycle of the allocated spectrum, by requiring that licensees make new applications every five years as a general rule.
Hampering investment
During its presentation, mobile operator MTN said it is strongly opposed to the maximum duration for a radio frequency spectrum licence to be limited to a period of five years.
“The authority should note that, due to the high cost of network infrastructure that runs into the billions of rands, the introduction of a five-year licence, with no guarantee of extension, will severely hamper new investment, as the return on this investment would not be recoverable in such a short space of time,” stated the operator's legal representative.
But Socikwa argued that, under the current annual renewal, the operators still had a steady income of billions from their investors.
MTN argued that it would make more sense to align the spectrum licence to its service licence.
MTN urged the authority to review this time period and adjust it to a more reasonable and fair period. “More specifically, we believe that it should be aligned to the time period of the ECNS licence issued. This is currently a period of 20 years,” said MTN's legal representative.
MTN argued that this would create a situation where the operator would gear up to offer services afforded to it by the 20-year timeframe of its ECNS licence, but would not be assured of having the spectrum to offer these due to a much shorter five-year timeframe.
The operator pointed to a statement in the explanatory document of the draft regulations: “It must be stressed that in most cases a 'fresh' application for the frequency will be approved.”
MTN noted that, while this was reassuring, it created uncertainty, because it is not included in the actual regulations and only in the explanatory document, which is not binding. MTN suggested that at the very least this reassurance be incorporated within the regulation.
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Frequency regulations open for comment
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