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Telkom is challenging communications regulator Icasa over the licensing of spectrum in a case that is scheduled for hearing in the high court in early April. Picture: REUTERS/SIPHIWE SEBEKO
Telkom is challenging communications regulator Icasa over the licensing of spectrum in a case that is scheduled for hearing in the high court in early April. Picture: REUTERS/SIPHIWE SEBEKO

For the good of the country’s economic progress, Telkom and the Independent Communications Authority of SA (Icasa) need to make peace with each other. The pair are getting ready to square off in court in the coming week over a case that could potentially invalidate the recent R14bn spectrum auction.

Over the past few years the regulator and the fixed-line operator have been at odds about how to appropriately issue new radio waves to mobile operators. 

Though having agreed to pay R2.1bn for new spectrum in Icasa’s recently held auction, Telkom still believes the process was rushed and not properly done, with effects that could still be felt in the next 20 years. 

Unlike previous court challenges, what makes this case different is that the auction has already taken place. This is not a matter of trying to block something from taking place.  

Whether the two parties care to admit it, they both have valid points.

Telkom is right when it says the design of the spectrum auction was flawed, and its position is supported by two earlier court rulings that it is irrational, reckless and unlawful for Icasa to sell the spectrum it does not control because the process to switch SA’s TV signals to digital from analogue is yet to be completed.

The so-called IMT700 and IMT800 are crucial for connecting rural areas to faster internet speeds as airwaves in this band cover long distances and require fewer base stations. In theory, that should give operators a strong commercial reason to set up network coverage in rural areas, where nearly one-third of the population lives. 

It is also easy to sympathise with Telkom’s assertion that the primary reason for challenging the process is to uphold the rule of law. However laudable the outcome of the Icasa process, we should not turn a blind eye to what Telkom argues is a process marred with legal breaches.

Furthermore, if one buys into Telkom’s contention that its court challenge is also driven by its pursuit of promoting competition, which comes with obvious positive implications for consumers,  it is worth checking if that position can stand up to scrutiny. 

At the same time, Icasa is right when it says the country needs spectrum and to move on. Its main defence is that it has gone too far down the road in terms of licensing spectrum to go back. Raising R14.4bn in the country’s first spectrum auction since 2004/2005 is a huge milestone. 

Understandably, the case — which will be heard from April 11 to 14 — has prompted a strong rebuke from communications & digital technologies minister Khumbudzo Ntshavheni as it threatens to knock off course one of the most important structural reforms aimed at putting the ailing economy on a robust growth path.

But can the two use other speedier avenues instead of a potentially protracted court challenge that can only mean corporate leaders will find it hard to convince their boardrooms to deploy money in the economy until there is some certainty?  

What is promising is that Telkom and Icasa agree that SA urgently needs spectrum at a time when President Cyril Ramaphosa is canvassing executives at home and abroad to invest in the ailing economy and put millions of people into jobs. 

SA was left behind on 3G and 4G technology, partly because the lack of spectrum forced operators, at great cost, to repurpose existing radio waves for these technologies. This is one of the reasons for high mobile data prices in SA. 

This time, the local industry has a chance to keep pace with, and even become a leader, in 5G and its many potential applications, such as the automation of car manufacturing plants in Rosslyn and East London, or simply making high-speed connectivity accessible to more people.

That should be a good enough reason for the two parties to be brought to the negotiating table to find each other and give investors who may want to build factories one less reason for worrying in a country that cannot promise them a stable electricity supply. 

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