The operator is once again seeking a court order to delay South Africa’s long-overdue spectrum auction, but rivals claim they are obstructing the process for commercial gain
Spectrum allocation is a slow process in South Africa and has been for many years now. Indeed, it has in fact been almost 17 years since fresh spectrum was released by the regulator, Independent Communications Authority of South Africa (ICASA), and five previous attempts to auction spectrum have failed.
While, naturally, this slow licencing process was lamented by the operators, the urgency of making further spectrum available was ultimately driven by the onset of the coronavirus in early 2020, when demand on national networks soared to unprecedented levels.
At the time, ICASA quickly made temporary spectrum licences available in the 700 MHz, 800 MHz, 2.3 GHz, 2.6 GHz, and 3.5 GHz bands, allowing South Africa’s operators to effectively meet demand.
ICASA said last year that they would ask operators to return the emergency spectrum by the end of November. However, by October, Telkom, MTN, and Vodacom had all joined forces to ask for an extension, arguing that the emergency situation had not yet ceased, and that millions of South Africans had become dependent on services they could not provide without the spectrum. They also argued that the withdrawal would disproportionately affect low-income citizens, like students.
As a result of the appeal, ICASA extended the licence offerings until the end of June 2022.
But while the use of this emergency spectrum has been repeatedly extended, the operators are restless, arguing that they need for permanency when it comes to their spectrum holdings so they can be confident in their investment strategies.
This desire, however, has not stopped the operators, particularly incumbent Telkom, from fighting with ICASA about the conditions attached to the spectrum auction. In March last year, objections by Telkom, MTN Group, and broadcaster e.tv saw ICASA ordered by a court to further delay the auction until parties could reach an agreement. At the heart of the dispute was that ICASA planned to auction off 700 MHz and 800 MHz spectrum that is currently being used by television broadcasters, before waiting for the broadcasters to migrate from analogue to digital.
Issues were also raised around the potential spectrum for the Wireless Open Access Network (WOAN), an operator-neutral wholesale network currently planned for licencing.
By the end of 2021, ICASA was working towards a provisional auction date of March 2022.
Now, however, even this late date seems in jeopardy, with Telkom once again appealing for the process to be delayed. The operator has reportedly filed an application to the Gauteng High Court to review the auction’s invitation to apply – the framework for the auction that was published by ICASA in December, including its rules and licencing obligations for the operators.
Telkom says that to auction the spectrum under the current rules would be unreasonable, given that a number of “reviewable errors” are present within the process. These objections are primarily founded on similar grounds as before; namely, that the issues surrounding access to sub-1 GHz spectrum are still being resolved and that issues surrounding the WOAN remain unclear.
“If allowed to stand, the (invitation) will have enduring negative consequences on the mobile market, including but not limited to reinforcing the anti-competitive structure of the mobile market,” read associated court papers.
This time, however, Telkom may find even less support from its peers, who are increasingly viewing Telkom’s legal manoeuvring as a means to stifle market competition and hang on to their dominant position.
In August last year, a video published on the Nielsen Network’s YouTube channel saw Shameel Joosub, Group CEO of Vodacom, accuse Telkom of deliberately delaying the auction process.
“Fundamentally, Telkom is not in the space where they want us to get spectrum because they have significantly more spectrum than anybody else,” he said, “Telkom has almost three times as much spectrum as the rest of the players, so delaying spectrum is part of their modus operandi, which they have been successfully doing for years now.”