Mobile operators are appealing to SA’s telecoms regulator to extend the term of temporary spectrum issued in 2020 in response to the increased demand for communications and online services brought on by Covid-19 lockdowns, adding to the private-sector voices calling for a plan to take away the radio waves in November.
In 2020 the Independent Communications Authority of SA (Icasa) assigned temporary radio frequency spectrum to mobile operators in an effort to address communication challenges during the Covid-19 national state of disaster.
Mobile operators have long argued that access to spectrum, radio frequencies on which data and information are carried, help reduce the cost of mobile data in SA because it will allow them to cover a wider geographical area with existing towers while carrying more data traffic.
Icasa announced two weeks ago that it would terminate the licences at the end of November, triggering discontent in boardrooms with executives saying the move could potentially add cost to their operations, while degrading telecommunications services for customers.
“Icasa’s refusal to extend temporary spectrum is likely to have a negative effect on the economy at a time when we can least afford it,” said Telkom, whose mobile phone unit has been growing rapidly thanks to its focus on pitching itself as a primarily internet data provider in a saturated market for basic telecoms services.
The decision also puts a harsh spotlight on SA’s slow progress in allocating the airwaves for network providers, which have had to make do and repurpose the frequency bands historically used for voice calls to handle an increasing amount of internet data traffic.
Vodacom boss Shameel Joosub said a lot of energy needs to be put behind spectrum “because SA is getting left behind”.
“We need to move on 5G. We need to get the spectrum allocated. To be honest, it’s a bit disappointing on the temporary spectrum because we need it to carry on until this auction process happens,” he said.
Industry players thought they would go on to the radio waves until a permanent allocation could be made through auction, a process that has suffered from years of delay.
The country’s two largest operators, Vodacom and MTN — which have more than 70-million customers between them in the local market — had both launched their commercial 5G services on the back of the temporary spectrum in 2020. A move to take away those radio waves could have a negative effect on such offerings.
While there is debate about whether the regulator has grounds to take away the spectrum, Cell C’s CEO argues that the crisis which necessitated the emergency allocation is not over yet.
“The temporary spectrum was always positioned as a temporary measure in response to the current Covid-19 pandemic,” said Douglas Craigie Stevenson. He said 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”.
Despite having made its threats, Icasa is expected to ultimately yield and extend its term.
“I think Icasa may extend the temporary spectrum until later or after the planned auction,” says Dobek Pater, an analyst at research firm Africa Analysis.
The objective was to determine what spectrum would be assigned to which operators participating in the auction, he said. “This way, some of the operators could continue using the temporary spectrum as it would be assigned to them under licence.”
While the case for how detrimental the move could be for consumers and operators is clear, the regulator could also benefit from an extension.
“Extending the temporary spectrum would enable Icasa to continue to collect revenues while reviewing and allocating spectrum with minimal disruption to Covid containment plans, commerce and services such as education,” said Telkom.
Outside the industry, private and public sector players have taken a keen interest in the spectrum debate, given the importance of communication technology in the modern economy.
Busi Mavuso, the CEO of Business Leadership SA, wrote in her Business Day column that it is also important to consider the economic impact of the decision.
“The rationale for Icasa’s decision is difficult to understand,” she said.
Mavuso highlights that under the adjusted level 2 lockdown regulations, employers are stipulated to continue allowing staff to work from home where possible.
“The loss of spectrum will substantially change the equation, it will no longer be possible for many employees to work from home as they will lose their data access. Employers will have little choice but to compel employees to return to work, with a corresponding spike in health risks, or jobs will be lost. Given that we still have 700,000 fewer people employed than before the pandemic, the last thing we should be doing is putting more jobs at risk.”
Mobile operators are hopeful that Icasa will reconsider its position on the matter.
Though the regulator has set itself a January 2022 deadline for the spectrum, that remains uncertain as Icasa now has to redraft its plan for the auction, after an agreement between it and mobile operators on the spectrum auction, endorsed by the high court last week.
The order comes months after behind-the-scenes negotiations between operators and Icasa to find a settlement. The high court ruled in March that the auction should be halted pending a judicial review of contentions raised by Telkom and e.tv. The television station has a stake in the process because its broadcast airwaves penetrate buildings and are ideal for sending cellular signals long distances.
The last time SA released spectrum was between 2004 and 2005.
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