Telkom has welcomed the decision by communications regulator Icasa to consent to a court order setting aside its decision to publish an invitation to apply (ITA) to take part in South Africa’s planned spectrum auction.

Icasa’s decision to publish the spectrum ITA and an interrelated ITA to license a wholesale open-access network, or Woan, came as industry players – including Telkom, eMedia Holdings and MTN, which have sued the regulator – engage in negotiations in an effort to reach an out-of-court settlement.

Icasa said on Tuesday that it is not withdrawing either ITA but that, by moving to consent with the court order it hopes to avoid a lengthy court battle over the spectrum auction. It said it believes the auction can still take place by January 2022, though few industry players believe this is possible.

Telkom said it “welcomes” Icasa’s decision o “reconsider its opposition to Telkom’s application to have the ITAs reviewed and set aside”. The review application is scheduled to be heard on 15 September.

“Inherent in Icasa’s decision to withdraw its opposition is a concession that the ITAs are irredeemably flawed,” Telkom said. Group CEO Sipho Maseko added: “This action by Icasa will hopefully speed up a fair and equitable licensing process, which will benefit all South Africans.”

‘Deeply flawed’

“We have been anxious to resolve this matter as quickly as possible. However, in late 2020 our objections fell on deaf ears and we had no choice but to approach the courts,” Maseko said in a statement. “Icasa’s decision is, in our view, the correct approach and an acknowledgment its auctioning process was deeply flawed and had the potential to harm competition,” he said.

“Telkom has consistently argued that the ITAs were designed in a manner that would entrench the anticompetitive market structure in South Africa and would have a negative impact on consumers and data costs.”

“This is a positive step in the right direction. However, many issues remain unresolved. We are committed to sincere and meaningful discussions with the regulator to resolve them and open a way to competitive and stable mobile sector,” Maseko said.

“We now call upon Icasa, the minister and the industry at large to cooperate in making sure that a proper fresh start is embarked upon, that is fair and transparent, which will lead to all of the current market structure flaws to be adequately addressed.”

Telkom rival Vodacom is less impressed with the latest developments. In a statement, South Africa’s largest mobile operator said consumers will be the biggest losers from an inevitable delay to the licensing process.

‘Extremely disappointed’

“We are extremely disappointed that this fourth attempt to license high demand spectrum in the last decade has failed considering we did our utmost to try and find a middle ground so that the spectrum auction could progress,” a company spokesman said in prepared remarks.

“The assignment of temporary spectrum – implemented as part of the National State of Disaster Act – has shown how consumers can benefit from high-demand spectrum being assigned on a long-term basis. Temporary spectrum has enabled customers to enjoy wider coverage and faster speeds as they have worked from home and accessed educational and entertainment content online since March 2020.

“Given that South Africa remains in a national state of disaster, and that the assignment of high-demand spectrum will be further delayed, we call on the regulator to reconsider its decision to end temporary spectrum assignments at the end of November, as this would be detrimental to consumers.”

Vodacom said it is prepared to work with Icasa and the communications minister to “expedite the assignment of high-demand spectrum”.

“As we have said previously, the award of new spectrum remains a critical part of reducing input costs and by extension the cost of data. We encourage all industry players to join Vodacom in working with government to find a solution that results in all mobile consumers finally experiencing the full benefit of South Africa’s national spectrum assets.” — © 2021 NewsCentral Media