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The Independent Communications Authority of South Africa (Icasa) this week announced the long-awaited invitation to apply (ITA) date for the Wireless Open Access Network (WOAN) and the International Mobile Telecommunications Spectrum, sparking excitement but also concerns. about the possible pricing of this coveted commodity.
The ITA date has now been set for September 30.
The deployment of spectrum for mobile and other services has experienced multiple delays, leaving South Africa somewhat behind in the implementation of technology services, including the much-acclaimed 5G mobile technology.
According to a recent study by World Wide Worx, the large mobile operators MTN, Vodacom, Cell C, Telkom and Seacom have expressed concern that the high auction price of spectrum could be a barrier to further investment in the network.
Despite the progressive information and communications technology (ICT) policy set out in the Electronic Communications Amendment Bill, South Africa has lagged behind other countries in issuing much-needed spectrum, which it has been in limbo for about 10 years, surpassing eight communications ministers.
Icasa originally issued an ITA for high-demand spectrum in 2016, but withdrew it after being sued by the then telecommunications minister, Siyabonga Cwele, who accused the regulator of issuing the ITA “prematurely and hastily without the existence of steps regulatory requirements that must precede them. ”.
In 2018, Icasa agreed to withdraw the ITA, which provided an idea of the likely minimum price for the auction bid, set at a minimum of R3 billion.
The president of Icasa, Dr. Keabetswe Modimoeng, has blamed the delay on several factors, including “among others: the prioritization of the release of the emergency spectrum Covid-19, additional considerations, particularly on the viability of the WOAN and the fact that (Icasa) the council was almost restless for a period of close to three months ”.
Modimoeng assured the industry that Icasa has also completed a process to determine the “fair economic value of the five spectrum bands that will be available for auction and the spectrum that will be made available to WOAN taking into consideration the current state of competition. in the South African market ”.
What is the spectrum allocation problem?
The spectrum was “one of the most critical and potentially controversial regulatory processes ever undertaken by Icasa, with immeasurable economic value for the country.”
“The delicate nature of the licensing process requires the authority to exercise greater caution to ensure full compliance with all administrative and procedural fairness requirements.
“It is also important that the end result of the process is accepted and supported by all stakeholders.
“We call on interested parties to adhere to the deadline to avoid further delays in the process,” Modimoeng said.
Considered as “the oxygen” and “the soul” of the mobile industry, the spectrum refers to the radio frequencies assigned in the country by Icasa to the industry and other sectors, over which they are allowed to transmit their communications.
“In light of the time lost due to the delay in the issuance of ITAs, the auction of the high-demand spectrum, which was originally scheduled for December 2020, will be completed no later than March 31, 2021.
“In line with its processes in the development of the ITAs, the authority considered and analyzed all representations received in response to the information memorandum (IM).
“To this end, a reasons document capturing the Authority’s positions on the comments received will be published at the same time as the ITA,” Modimoeng explained.
Key representations considerations in the information memorandum include:
- Development of various empowerment obligations to be imposed on winners in the auction process, including a requirement to support mobile virtual network operators.
- Requirement for the successful bidders to support the WOAN by acquiring a minimum of 30% of the national capacity.
- Imposition of empowerment obligations on WOAN to ensure that it is a credible empowerment tool that will help the Authority achieve the sector’s transformation agenda.
- Structure and frame the lots in a way that balances the objective of promoting effective competition, facilitating the entry of new participants and generating income for the treasury.
More than a decade of delays, but why?
So slow has been the advance of South Africa’s telecommunications and broadcasting that the country has not been able to keep up with international trends, creating business uncertainty.
In an attempt to introduce changes aimed at bringing the country in line with global standards, the Independent Communications Authority (Icasa) has often found itself at odds with politicians, in a government department that has seen ministers come and go.
The chronicle of events included:
- Important blocks of high demand spectrum issued by Icasa to the main network operators since 2005, when it allowed the use of the 2.1GHz band for the deployment of 3G networks by Vodacom and MTN. Cell C was assigned spectrum in 2011.
- Icasa issued an invitation to request (ITA) in 2016 for high-demand spectrum, but withdrew it after being sued by then-telecommunications minister Siyabonga Cwele, who accused the regulator of issuing the ITA “prematurely and hastily without the existence of the required regulatory steps. which must precede them ”.
- The regulator in 2018 withdrew the ITA, providing an idea of the likely minimum price for the auction bid, set at a minimum of R3 billion.
- Icasa in June 2020, informing the parliamentary communications portfolio commission that the ITA would be issued before the end of the month, but due to the “complexity of the process”, this could not be specified.
Because South Africa failed to meet the June 2015 deadline set by the International Telecommunications Union for countries to complete the full switch from analogue to digital terrestrial television (DTT), the country continued to lag behind other nations. . This process is still in limbo, as the government and the private sector battle over encryption protocols for digital set-top boxes.
Mobile operators have claimed that much of the emergency spectrum has proven to be less useful than originally expected, due to interference from broadcast television services that have yet to migrate from analog to digital.
Just a year after the government approved a revised delivery model to implement the Broadcasting Digital Migration (BDM) program, it said it was returning to the drawing board to “speed up” delayed DTT.
In her budget voting speech in 2019, the Minister of Communications and Digital Technologies, Stella Ndabeni-Abrahams, promised the country a new model.
“Within 90 days, the department will present the revised broadcast digital migration delivery model to enable rapid release of the high-demand spectrum necessary for broadband roll-out and effective DTT migration,” said Ndabeni-Abrahams. .
South Africa is still waiting.
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