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Operators question ‘premature’ returning of temporary spectrum

Read time 6min 40sec

Mobile operators are concerned that if the telecoms regulator takes back the temporary spectrum prematurely, it may have a significant impact on data supply to South Africans.

The operators are calling on the Independent Communications Authority of South Africa (ICASA) to again extend the temporary spectrum allocation, as the country is still battling the COVID-19 pandemic.

This follows ICASA’s announcement this week that it has resolved that the temporary radio frequency spectrum assigned to licensees will have to be returned to the authority by no later than 30 November.

The temporary radio frequency spectrum was first assigned by means of an expedited invitation to apply during April 2020 on the initial declaration of the National State of Disaster, occasioned by the COVID-19 pandemic.

As the pandemic continues to take a toll on SA, yesterday Cabinet approved the extension of the National State of Disaster to next month.

After the release of the temporary spectrum, mobile operators have largely used it to launch 5G networks in SA’s cities, as well as cater for the increase in data demand as more people took to remote working and learning.

The regulator has on two occasions extended the duration of the temporary radio frequency spectrum assignment, the last expiry date being 31 August 2021.

Now, ICASA says it cannot allow the temporary spectrum assignment to assume a state of permanence.

The mobile operators have long been waiting for ICASA to auction spectrum, which it was set to auction by 31 March 2021.

However, it was dealt a blow when MTN, Telkom and Etv took the regulator to court, challenging some aspects of the auction process.

Increased data demand

Commenting on ICASA’s move to take back the temporary spectrum, Jacqui O’Sullivan, MTN executive for corporate affairs, says since the start of the pandemic, the amount of data traffic that MTN has needed to carry for its customers has more than doubled.

“Removing the temporary spectrum, when the pandemic remains a reality for all South Africans and before ICASA completes the spectrum auction, will have a significant impact on data supply to South Africans,” she says.

Jacqui O’Sullivan, executive for corporate affairs at MTN South Africa.
Jacqui O’Sullivan, executive for corporate affairs at MTN South Africa.

O’Sullivan notes the temporary spectrum has enabled MTN to support a sustained increase in data traffic since March 2020 and provide consumers with lower-priced packages, improved speeds and other benefits, such as free data and free mobile money transactions, during the pandemic.

She points out that the 165% increase in data traffic, since the start of the pandemic, has resulted in operators such as MTN becoming dependent on this additional capacity to meet these high levels of demand, while also managing the quality of service.

“Customers need ‘office speeds’ from their home offices as well and the temporary spectrum is helping us ensure this requirement can be met. Removing the temporary spectrum could result in reduced quality and speed, which our customers and our already-fragile economy can ill-afford.

“With the temporary spectrum, MTN has been able to continue expanding and enhancing our network; we’ve been able to bring more people online and we have been able to reduce prices. We have zero-rated more than 1 000 health and education websites, which are currently serving more than five million people each month, and in the past year, we dropped the effective price of data by more than 30%.

“Removing this spectrum would leave more than five million South Africans without access to zero-rated websites of public benefit organisations – this would impact access to (predominantly) educational and health information whilst we are still in the middle of the COVID-19 pandemic.”

According to ICASA, O’Sullivan adds, the temporary release of high-demand spectrum to licensees was aimed at mitigating the impact of the National State of Disaster, following the outbreak of COVID-19 in 2020, mainly by easing network congestion, maintaining good quality of broadband services, and enabling licensees to lower the cost of access to consumers.

However, she says, the impact of the National State of Disaster has not eased since the last extension of temporary spectrum.

“The expiry of the temporary licences during the course of the COVID-19 pandemic would come at a significant cost to MTN. Operators have spent billions of rands expanding infrastructure to cater for the temporary spectrum – this infrastructure would be condemned to idleness without frequencies to leverage. This would be seen as an anti-investor stance.”

She adds that MTN has used some of the temporary spectrum to showcase the startling speed and capabilities of 5G, not only in large cities but also in smaller towns such as Port Alfred, Hopetown, Virginia, Queenstown and Tsantsabane.

“To this end, the withdrawal of the temporary spectrum allocation, and in the absence of a permanent spectrum allocation, our national 5G rollout would be significantly impacted.

“Mobile operators have a vital role to play in the rebuilding of our nation and supporting our citizens during the course of the pandemic. In order to achieve this, it is critical that the temporary spectrum be extended up to the finalisation of the invitation to apply to the spectrum auction.”

Seeking engagements

Vodacom says it welcomes ICASA's decision to extend the validity of temporary spectrum assignment until the end of November and will seek to engage the regulator regarding its stance on further temporary extensions.

“Given temporary spectrum was introduced through the National State of Disaster Act, as a mechanism to assist networks in meeting sudden shifts in customer behaviour at the onset of COVID-19 lockdowns in South Africa, it may be detrimental to consumers to withdraw the allocation prematurely while the National State of Disaster remains in place,” a Vodacom spokesperson tells ITWeb via e-mail.

Douglas Craigie Stevenson CEO of Cell C.
Douglas Craigie Stevenson CEO of Cell C.

The company says customers have undoubtedly benefited from wider coverage and faster speeds as a result of the temporary spectrum assignment, as they have worked from home and accessed educational and entertainment content online over the past 18 months.

“While we don't necessarily share ICASA’s view on the current COVID-19-related environment in South Africa, we remain encouraged by the focus that ICASA wishes to maintain on the auctioning of high-demand spectrum. As we said previously, the award of new spectrum remains a critical part of reducing input costs and by extension the cost of data. Further delays in this regard remain detrimental to consumers,” says the spokesperson.

Cell C CEO Douglas Craigie Stevenson comments that the temporary spectrum was always positioned as a temporary measure in response to the current COVID-19 pandemic.

“COVID-19 has not ended and there is a need for spectrum to support data growth as the digital response has supported the way we have adapted to living, working, education and learning, commercial trading, entertainment, etc, in these pandemic times,” says Craigie Stevenson.

He notes Cell C did not apply for temporary spectrum as “we had sufficient capacity on our existing network as well as the virtual radio access network that has been made available to Cell C customers through the MTN agreement as well as its roaming agreement with Vodacom.

“Since the national lockdown was instituted in March 2020, Cell C has seen an increase in voice and data traffic, and collectively, this makes up the greatest demand from our customers.”

Telkom had not responded to ITWeb’s request for comment by the time of publication.

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