MTN to address MPs with its ‘back to the wall’
Mobile operator says it is unfair to force the opening of its network to competitors at prescribed rates
MTN plans to tell parliament on Thursday it would be unfair to force the mobile operator to open up its network to competitors at prescribed rates.
The government is holding public hearings this week on the contentious Electronic Communications Amendment Bill, according to which a service provider with “significant market power”, or at least 25% of SA’s network infrastructure, has to share its infrastructure with competitors.
While MTN and Vodacom already do this through roaming agreements with smaller players, the caveat is that the Independent Communications Authority of SA (Icasa) will prescribe the “cost-oriented” rates these operators can charge their rivals, according to the bill.
“We’re going to parliament on Thursday with our backs against the wall because we feel strongly about what they’re doing around us being forced to open up our infrastructure at cost,” said MTN’s CEO for SA, Godfrey Motsa. “We want to open our infrastructure, but it should be through commercially agreeable terms.”
MTN signed a roaming agreement with Cell C earlier in 2018, and Motsa said it has also held discussions with Standard Bank, which launched its own mobile services in November.
Standard Bank ultimately reached an agreement with Cell C to use its network.
Meanwhile, Motsa said MTN is “working hard” to make sure it secures much-needed spectrum when the state finally gets around to auctioning batches of radio frequencies in the first quarter of 2019.
The government is set to auction spectrum in the 700MHz, 800MHz and 2,600MHz bands.
While the 700MHz and 800MHz bands will be tied up in television services for some time after the auction — since SA is yet to migrate to digital broadcasting — Motsa said MTN will be able to use the 2,600MHz band immediately.
“That will help with densification, especially in urban areas because that’s where it’s more suitable. And as we gain spectrum, we are going to reduce prices significantly.”
Mobile operators have long argued that SA’s data costs could be drastically reduced if the state releases spectrum. The dearth of radio frequencies means they have to spend more on network infrastructure than usual.
Motsa said price reductions will help MTN reach its target of 40-million subscribers in SA by 2022, including 30-million data users and 20-million digital services subscribers.
At the end of June, it had 30.2-million subscribers in SA.
The operator would also raise 4G coverage to 100%, from 90% currently, and boost smartphone penetration.
MTN and its partners, including China Mobile, have developed an entry-level smartphone that could be sold in SA at about R300, well below the cheapest alternatives currently available to consumers, according to Motsa.