Communications regulator Icasa will finally invite mobile operators to apply to bid for spectrum for 4G and next-generation 5G networks from 2 October, with the country’s first-ever auctions expected to take place by the end of March 2021.
Allocation of frequency bands for wireless communication is seen as key to expanding broadband services, especially 5G in South Africa, where the high cost of telecommunications is a barrier to doing business.
“The authority will make available 406MHz of spectrum for the provision of mobile broadband services in South Africa,” Icasa chairman Keabetswe Modimoeng told journalists.
Data costs have come down after mobile operators were forced to cut prices, but they argue that prices can’t drop significantly until regulators auction the much needed spectrum.
There are five main mobile operators in South Africa — MTN, Vodacom, partially state-owned operator Telkom, unlisted Cell C, and Rain.
The operators will be able to bid for spectrum in the 700MHz, 800MHz, 2.6GHz and 3.5GHz bands. A plan to sell spectrum in the 2.3GHz band has been abandoned for now. Reserve prices for lots in the 3.5GHz band, key for 5G, range from R9.8-million to R75.6-million rand, Modimoeng said.
The closing date for interested bidders to register is 28 December, while the closing date for the government’s wireless open-access network (Woan) invitation is 30 March 2021.
The Woan, which will be owned by private-sector players, is the government’s way of creating a shared model for spectrum allocation rather than auctioning the resource to the highest bidder. Successful licensees of high-demand spectrum will be obliged to procure a minimum of 30% national capacity from the Woan “collectively as soon as the Woan is operational for a period of seven years”, Modimoeng said.
Icasa had been at odds with the government over the allocation of these licences. The government went to court in 2016, blocking the auction after Icasa unexpectedly announced the sale in July 2016. — Reported by Nqobile Dludla, (c) 2020 Reuters