Contentious bill’s ‘open up’ plan likely to scare MTN and Vodacom
The Electronic Communications Amendment Bill finds favour among smaller operators who oppose the dominance of major players
The latest version of the Electronic Communications Amendment Bill is likely to spook Vodacom and MTN with a proposal that they open up their networks to competitors.
The contentious bill, which has been revised several times and is ready to be presented to parliament, has worried investors but found support among smaller operators and those who argue that Vodacom and MTN’s dominance of the local market must be reined in.
The bill says a service provider with "significant market power", or at least 25% of SA’s network infrastructure, must share its infrastructure with competitors. The Independent Communications Authority of SA (Icasa) is to prescribe the "cost-oriented" rates these operators can charge their rivals, according to the bill.
An MTN spokesperson told Business Day that since the latest version of the bill was not yet before parliament, "we respect the process that is required and would prefer to comment on the version that is finally sent to parliament and only once that process has been concluded".
A spokesperson for Vodacom said the operator was reviewing the bill "and will comment in due course".
Analysts have argued that if operators are forced to share infrastructure with competitors, there will be little incentive for them to invest in spectrum and other assets.
President Cyril Ramaphosa said on Monday the government had "finalised" consultations with the telecommunications industry and other stakeholders "to ensure allocation of spectrum reduces barriers to entry, promotes competition and reduces costs to consumers".
An end to SA’s spectrum impasse was imminent, he said.
Network operators have said for years that the lack of spectrum is hindering their ability to roll out services.
There has been a freeze on new spectrum allocations as the Department of Telecommunications and Postal Services and Icasa have disagreed on allocation methods.
"Following a cabinet decision last month, our regulator, Icasa, is now preparing to license available high-demand spectrum," Ramaphosa said at the International Telecommunication Union Telecom World conference in Durban.
"Government has recently decided to accelerate the licensing of the radio frequency spectrum in the 2.6GHz, 700MHz and 800MHz bands to hasten the growth of mobile communications," he said.
The government had also begun preparing for 5G spectrum licensing as part of its plans to build "a smarter digital economy", he said.
Vodacom recently launched Africa’s first commercial 5G service in neighbouring Lesotho and said the same would be possible in SA if the right spectrum was made available.