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'Fresh start' after ICASA concession, comms minister undaunted

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Communications and digital technologies minister Khumbudzo Ntshavheni.
Communications and digital technologies minister Khumbudzo Ntshavheni.

The latest developments concerning the drawn-out spectrum process won’t detract the ongoing engagementswith telcos and other relevant parties to find an amicable solution, says new communications minister Khumbudzo Ntshavheni.

Yesterday, telecoms regulator the Independent Communications Authority of SA (ICASA) confirmed it had not reached a settlement agreement in the ongoing spectrum litigation.

As a result, ICASA said it’s decided to consent to an order setting aside its decision to publish the invitations to apply (ITA) for high-demand spectrum licences and for a licence to operate a wholesale open access network (WOAN).

This, explained ICASA, means the licensing of high-demand spectrum and the WOAN will now be reconsidered by the authority, taking into consideration the issues raised by the litigants – such as the completion of the broadcasting digital migration process and the assessment of competition in the ICT sector.

In a statement issued by her department, the minister notes the regulator’s decision, saying she will continue to engage the parties concerned to find a solution towards the urgent release of the spectrum.

According to the statement, Ntshavheni is encouraged by the attitude of the various parties on processes that are in the national interest.

“The release of the spectrum is one of the key reforms necessary to ignite economic growth and recovery, more especially after the COVID-19 pandemic has moved the daily operations of the economy to the digital space.”

A tale as old as time

The telecoms industry has been waiting with bated breath for the release of spectrum since president Cyril Ramaphosa promised swift actionin regards to allocation of high-demand radio spectrum during the 2018 State of the Nation Address.

South Africa’s allocation of high-demand spectrum has been up in the air for a number of years, with the last significant spectrum awarded 16 years ago. 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, SA is one of the few countries that have not allocated 4G/LTE spectrum on the continent. This has forced local operators to improvise with spectrum re-farming and carrier aggregation.

For the mobile operators, spectrum allocation will help provide faster and more widespread high-speed data services. It’s expected that the freed-up spectrum will reduce the cost of data and increase access to the internet.

Additionally, for government, a spectrum auction means a boost to the fiscus.

When it seemed the spectrum allocation process was finally moving along, ICASA was dealt a blow when MTN, Telkom and Etv took the regulator to court, challenging some aspects of the auction process.

The telecoms regulator was set to auction the long-awaited high-demand spectrum by 31 March 2021.

Telkom filed its legal dispute for a number of reasons, including that the way the auction is structured will entrench the dominance of its rivals MTN and Vodacom.

Broadcaster Etv joined Telkom in its legal bid. Its argument is centred on ICASA’s plan to auction spectrum in the 700MHz and 800MHz frequency bands, where spectrum is still being used by TV broadcasters.

MTN dragged ICASA to the North Gauteng High Court in January, challenging the way in which the regulator intends to license the 3.5GHz spectrum, which it said would result in tier one operators being side-lined in the auction.

Amid the ongoing litigation, former communications minister Stella Ndabeni-Abrahams expressed that the impasse over the licensing of high-demand spectrum and the WOAN was hampering government’s determination to rebuild the economy.

In June, the regulator said the ongoing settlement negotiations on spectrum litigation were “unfolding well and with a very encouraging outlook”.

This, after Ramaphosa called for mediation in the legal impasse that has held back the country’s spectrum auction process.

Conceding the flaw

Meanwhile, Telkom, which was the first to take issue with the spectrum allocation process, says it welcomes the decision by ICASA to reconsider its opposition to the mobile operator’s application to have the ITAs reviewed and set aside.

Inherent in ICASA’s decision to withdraw its opposition is a concession that the ITAs are irredeemably flawed, says Telkom.

Outgoing Telkom Group CEO Sipho Maseko says ICASA’s action will hopefully speed-up a fair and equitable licensing process, which will benefit all South Africans.

“We have been anxious to resolve this matter as quickly as possible. However, in late 2020, our objections fell on deaf ears and we had no choice but to approach the courts.

“ICASA’s decision is, in our view, the correct approach and an acknowledgment its auctioning process was deeply flawed and had the potential to harm competition.”

According to Telkom, it has consistently argued the ITAs were designed in a manner that would entrench the anti-competitive market structure in South Africa and would have a negative impact on consumers and data costs.

“This is a positive step in the right direction; however, many issues remain unresolved. We are committed to sincere and meaningful discussions with the regulator to resolve them and open a way to a competitive and stable mobile sector.

“We now call upon ICASA, the minister and the industry at large to cooperate in making sure that a proper fresh start is embarked upon, that is fair and transparent, which will lead to all of the current market structure flaws to be adequately addressed,” concludes Maseko.

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