MTN does not see satellite providers such as Starlink as direct competition, but rather as a complementary technology and option for connectivity, contrary to the now-pervasive view that Elon Musk's company would threaten SA’s mobile operators if it were allowed to start operating locally.
“We don’t see them as direct competition. We do believe that they can promote coverage. Someone in an area where we’re not able to provide towers will benefit from this,” MTN SA CEO Charles Molapisi told Business Day.
The main reason for the growth in use of low Earth orbiting (LEO) satellites like those provided by Starlink and Eutelsat OneWeb is the cost. Transporting equipment into space is now much cheaper than it was decades ago, in part because space rockets are now reusable — as demonstrated by SpaceX.
In terms of connectivity, the two disadvantages with traditional satellite technology have to do with latency (the time it takes for signals to reach their destination) and limited bandwidth (the amount of data that can travel through a signal).
Low-altitude satellites improve on this, offering faster speeds, mainly because they are closer to the ground.
Even then, Molapisi said the technology was better suited for rural and outlying areas where mobile and fibre operators found it uneconomical to build their networks. Fibre and fixed wireless access (FWA) are well established in towns and cities due to their density.
“Can they [satellite providers] play in metro areas? Very unlikely in terms of the number of concurrent users and throughput that [satellite] provides. Most towns in the country are actually fibre wired. Townships are being fibre wired. FWA is very strong on 5G,” he said.
“We’ve got about 45% percent population coverage on 5G, which is our biggest strength. We’ve got the best network in SA. So are we worried? No. Do we welcome them? Yes. Do we see them as a threat? No. We see them as a player, that can complement our services.”
This comes almost a week after communications and digital technologies minister Solly Malatsi gazetted a policy directive on the role of equity equivalent investment programmes (EEIPs) in the information and communication technology (ICT) sector “as a mechanism to accelerate broadband access”.
It is widely expected that the government will face opposition by local network operators if more concessions are made to allow foreign telecom companies to enter the SA market using a different set of rules.
SA operators say they have no problem with more players entering the market as long as there is regulatory parity.
“If MTN is providing network services in an area where Starlink is providing the same services, the rules must apply the same,” said Molapisi.
The rules governing who can acquire a licence to provide electronic communications services or to operate a network require a minimum of 30% of shares to be in the hands of historically disadvantaged individuals.
The government’s move to address SA-born Musk’s biggest gripe with BEE laws he is insistent he will not abide by would open the door for Musk to start operating in SA.
“There is no pushback by MTN and no pushback by the industry at all. We welcome the competition, we think that it’s going to help the country, but let’s make sure that we create a framework that is transparent and accessible to everybody,” the telecoms executive said.
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