Telkom said on Wednesday that it has approached the Competition Tribunal, seeking to have the spectrum arrangements between Vodacom and Rain declared a merger and therefore notifiable in terms of the Competition Act.
“Telkom contends that the merger is notifiable because the multiple agreements between Vodacom and Rain grant Vodacom use and control over the deployment of Rain’s spectrum, including the planning, roll-out, maintenance and service of its radio access network,” Telkom said in a statement.
Telkom group executive for regulatory affairs and government relations Siyabonga Mahlangu said Vodacom’s “ability to control Rain’s spectrum entrenches its position as a dominant player in a highly concentrated market”.
“It is important that the effects of spectrum arrangements on competition are scrutinised,” Mahlangu said. This is particularly so “in light of the upcoming spectrum auction which will set the ground for the nature of competition in the mobile market for the foreseeable future”.
Asked for comment on the Telkom action, Vodacom told TechCentral via e-mail that both the Competition Commission and communications regulator Icasa have previously investigated its agreements with Rain.
“The Competition Commission found that the 2018 agreements do not constitute a merger in terms of the Competition Act. Icasa found that the 2018 agreements are not in breach of the Electronic Communications Act,” Vodacom said.
“Furthermore, in its discussion document on the market inquiry into mobile broadband services in South Africa, Icasa stated that the arrangement has facilitated the expansion of Rain as a wholesale and retail competitor in mobile broadband, which Icasa deemed to be pro-competitive.”
Vodacom said it “remains confident” that the agreements between itself and Rain do not constitute a notifiable merger and do not contravene the Competition Act.
Rain spokesman Khaya Dlanga, meanwhile, said in an e-mail that the company provides “non-exclusive roaming services to Vodacom”. He added that this arrangement has “previously been scrutinised and approved by the Competition Commission and Icasa”.
“Rain also competes fiercely in the retail 4G and 5G data markets in South Africa with innovative and affordable unlimited products.” — (c) 2020 NewsCentral Media