SA’s telecoms regulator took a big step forward in its plan to issue new radio frequency spectrum by March next year with a new invitation to apply to industry players who wish to take part in the spectrum auction.
The Independent Communications Authority of SA (Icasa) has been redrafting its plan for the spectrum auction after an agreement with mobile operators, which was endorsed by the high court in September. The regulator had planned to auction about R8bn worth of broadband spectrum this year, but the March deadline could not be met because of legal battles over the process.
The high cost of electronic communication in SA has largely been blamed on a lack of competition and the “spectrum crunch”. Fixing this issue has become a key part of President Cyril Ramaphosa’s economic recovery plan, but its implementation has been delayed a number of times.
The last time SA released spectrum was 2004/2005.
On Friday, Icasa said it had issued the final invitation to apply in the licensing process for high-demand spectrum. The document was published in the Government Gazette on the same day.
Icasa said the invitation was issued after three months of consultation with industry players as part of its “truncated timetable and road map for the expedited licensing of high spectrum”.
The timetable sets out various activities that make up the regulator’s process for licensing, such as educational workshops, deadlines for public submissions, publishing an invitation to apply for spectrum, an announcement of bidders and the actual auction, which is set to begin on March 1, 2022.
Icasa says the new invitation to apply (ITA) “has considered the issues raised by stakeholders in their challenge to the previous licensing processes” — particularly the 2020 ITA — as well as feedback from the consultation process.
The high court ruled in March that the auction should be halted pending a judicial review of contentions raised by Telkom and e.tv.
Icasa chair Keabetswe Modimoeng said: “The publication of the first and second IM [information memorandum] was done to ensure that stakeholders can have a clearer preview of the intended licensing process and associated licensing conditions — and be afforded the opportunity to make representations to the authority on what the final licensing process and conditions should entail.
“We urge all industry stakeholders to embrace this licensing process, and the auction, as this is the most open and transparent way in which spectrum will be permanently awarded. All the other provisional spectrum arrangements remain interim and will end at the stipulated and communicated dates.”
Applications are open until the end of January, with Icasa saying it may adjust its plan depending on government’s progress with implementing the digital migration programme, as television broadcasters are currently using some of the spectrum that mobile operators are looking to bid on.
In the face of some opposition about the viability of an auction, the regulator has continued to defend its model, saying it “remains of the view that the auction model is the best method of assigning high-demand radio frequency spectrum”.
The regulator also said it had designed the auction to include spectrum floors and spectrum caps, the opt-in round, and spectrum-sharing provisions.
“These provisions are designed to facilitate the entry of new players into the market, and to promote consumer welfare through access to high quality communication services at affordable and competitive prices,” it said.
Fixed-line operator Telkom said it is concerned about the separate licensing process of the Wireless Open Access Network (WOAN).
Siyabonga Mahlangu, Telkom’s group executive for regulatory affairs, says licensing of the WOAN is intertwined with, and has a bearing on, the current licensing process.
“We hope that a further reading of the published ITA will reflect that the ITA has been designed to substantively deliver much needed competition in the sector and lower prices for consumers,” he said.
“Icasa has a duty to use the consultation process to design ITAs that promote competition, attract foreign direct investment and set SA up to participate effectively in the digital economy.”
This latest move comes shortly after the regulator issued new temporary spectrum licences to network operators.
In 2020, Icasa assigned temporary additional radio frequency spectrum to the main mobile operators to cope with a surge in data traffic as the pandemic-induced lockdown restrictions cut off employees from workplaces, students from classrooms and public representatives from citizens.
But in late August the regulator said it would terminate the licences at the end of November.
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