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Spectrum licensing process to begin in April, says ICASA

Samuel Mungadze
By Samuel Mungadze, Africa editor
Johannesburg, 03 Feb 2020
Dr Keabetswe Modimoeng, ICASA’s acting chairperson.
Dr Keabetswe Modimoeng, ICASA’s acting chairperson.

Communications regulator, the Independent Communications Authority of South Africa (ICASA), says it will “carefully manage the possible inter-dependencies” when considering options to allocate spectrum.

This as a battle of authority has been brewing between the Competition Commission (CompCom) and ICASA over data pricing.

The battle lines were drawn in November following a damaging finding by the CompCom that MTN and Vodacom are perpetuating the high costs of data.

After two years of investigating the cost of data in the country, the CompCom concluded that notwithstanding the most recent price reductions, Vodacom and MTN must independently reach an agreement with it on substantial and immediate reductions on tariff levels, “especially prepaid monthly bundles, within two months of the release of the report.

“The preliminary evidence suggests there is scope for price reductions in the region of 30% to 50%,” reads the report.

On Friday, ICASA announced the spectrum licensing process will start in April, following three months of public submissions.

The regulator says it received over 40 written representations since 1 November, when it published the long-awaited information memorandum (IM) on the licensing process of the International Mobile Telecommunications spectrum.

The regulator says in the context of considering representations received, ICASA will also be engaging with the recommendations proposed by the CompCom in its final Data Services Market Inquiry report insofar as the said recommendations pertain to the assignment of high-demand spectrum.

It notes this approach will be in the spirit of ensuring consistency and certainty in regulatory outcomes.

“The next milestone in the licensing process is scheduled for first quarter of the 2020/21 financial year starting in April this year, when the authority will, informed by analysis of the representations received on the IM, outline in detail the process that will ensue and the likely date for assignment of the high-demand spectrum. This relates to both the auction and WOAN licensing processes.”

Additionally, the regulator says the release of high-demand spectrum is the most seminal licensing process for the future of the sector.

“The authority is, therefore, mindful of the far-reaching consequential implications of this process – not just for the authority but for the wider South African economy.”

Dr Keabetswe Modimoeng, ICASA’s acting chairperson, says: “It is of critical importance that we embark on a legally sound process, underpinned by solid forward-looking technical and economic considerations, all in the public interest. It is in this spirit that we engage with the submissions and all other related processes to ensure alignment with the broader government objective of ensuring universal access to broadband services for all.

“The authority remains unequivocally committed to efforts of lowering the cost to communicate (particularly data), ensuring good quality of service whilst sustaining the clarion call of making South Africa an attractive investment destination.”

Mobile operators have been waiting for years for allocation of spectrum in order to provide faster and more widespread high-speed data services.

The last big set of spectrum issued was in the 2.1GHz band, which helped the operators in their 3G network deployment. Vodacom and MTN were allocated such spectrum, respectively, in 2004 and 2005, while Cell C received such spectrum in 2011.

When issuing the policy direction, minister of communications and digital technologies Stella Ndabeni-Abrahams said she recognises there are over 400 players that hold electronic communications network service licences but cannot access spectrum, due to its scarcity.

“This has an adverse effect on competition, contributes to the high cost to communicate and serves as a barrier to entry for new entrants and SMMEs. Government is committed to maximising the socio-economic benefits derived from the use of the spectrum and recognises that a shared approach to spectrum use is necessary.”

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