Mobile network operators want to get exemptions from competition law so that they can collaborate more closely in rolling out telecommunications infrastructure around the country.
The plea — supported by the department of communications & digital technologies — was made by the CEOs of MTN and Vodacom and a senior executive of Telkom during an engagement with parliament’s communications and digital technologies committee on Friday.
Cell C’s CFO and the CEO of the Association of Communications and Technology (ACT) also attended the meeting.
If the industry succeeds, it would continue a trend for industries to be exempted from the prohibitions on collusion set out in SA’s competition legislation.
Trade, industry & competition minister Parks Tau recently granted exemptions for the sugar industry and for ports and rail. His sugar industry exemption allows it to collaborate over the next five years on price increases for sugar products and the timing of such increases.
Last month Tau granted a 15-year block exemption to the port and rail network sector from sections of the Competition Act. Entities can now co-ordinate the repair, maintenance and upgrading of port infrastructure — including the joint funding of such projects.
Department of communications & digital technologies chief director of telecommunications and IT policy Alf Wiltz said the department supported the sharing of infrastructure and that the industry regulator, the Independent Communications Authority of SA (Icasa), needed to update facility-leasing regulations in light of the Gauteng high court judgment on the matter.
This would facilitate the sharing of infrastructure.
MTN CEO Charles Molapisi called for co-share arrangements for the building of infrastructure to be allowed by the Competition Commission and the regulator to minimise the cost and accelerate the provision of infrastructure around the country. This view was supported by Vodacom CEO Sitholizwe Mdlalose, who said it would assist in spreading rural coverage.
One of the concerns of the committee was the exclusion of rural areas from internet and mobile connectivity, which entrenched the digital divide. Committee chair Khusela Diko said sharing of infrastructure would prevent duplication.
“We have to consolidate and share to achieve universal coverage,” Molapisi said. He added MTN and Vodacom were already co-located on about 2,000 sites and exploring ways to extend this collaboration to the same security services for such sites to reduce costs.
The Competition Commission had been engaged on this as well as on the possibility of co-building infrastructure.
“Any possible sharing under the current construct, we are going to do,” Molapisi said. “We have to consolidate our resources and share so that we can achieve universal coverage.”
Whereas in the past the number of sites gave network advantage in terms of footprint and was a key differentiator, he explained, this was no longer the case as a network was shared and companies roamed on each other’s networks.
Mdlalose noted that “there are significant opportunities to lower the input cost, for example in the sharing of infrastructure”. Deepening the collaboration could include sharing the radio network and planning where to build transmission towers. However, this would require legislative support.
Mdlalose told MPs that in the 2025 financial year Vodacom spent R11.6bn on enhancing its network and projected to spend R12bn in the 2026 financial year. MTN has spent about R95bn on capital expenditure over the past 10 years while Telkom invested about R100bn on its fixed and mobile operations in 2010-15 and an average of R5bn-R6bn each year thereafter.
Telkom CEO of consumer and small business Lunga Siyo said the industry was engaging with Icasa and the Competition Commission on issues that could potentially be seen as collusion. The rules on infrastructure sharing needed to be clear.
Vandalism of telecoms infrastructure was highlighted during the presentations by the mobile network companies. Telkom’s Siyo said the rise in vandalism incidents, particularly during periods of load-shedding, had led to increased costs for operators and the need for enhanced security.
More than 2,000 sites had been vandalised in the past three years at a cost of more than R300m in repairs. “The total annual costs to combat economic sabotage of critical infrastructure, theft and vandalism are estimated to be R7bn ... The wider economic impact or indirect loss is R187bn,” Siyo said.
He welcomed the Treasury’s initiative to remove ad valorem taxes on entry-level handsets, to reduce the cost of mobile devices, but said handsets should be zero-rated for VAT to support universal access to the internet.
On the possible entrance of satellite provider Starlink to the SA market, ACT CEO Nomvuyiso Batyi stressed that there had to be an equal playing field for all operators. A special dispensation could not be provided for one.
She highlighted the prevailing policy and regulatory uncertainty and urged that legislative reform not be done in a piecemeal fashion.
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