The Independent Communications Authority of SA (ICASA) is inviting industry comment regarding the procedures and criteria for awarding radio spectrum frequency licences for competing applications.
The impact of the current spectrum allocation regime, which was developed in line with the Telecommunications Act of 1996, has been described by some stakeholders as unfair, as it provided Telkom and Sentech with the lion's share of spectrum, at little cost.
Mike Brierley, CEO of MTN Network Solutions, in his presentation at the GovTech conference last week, highlighted the fact that mobile operators each pay an annual fee of R5 million, as well as R100 000 per MHz and "in kind" obligations for their 3G licences.
"There was no policy of 'use it or lose it' in place, and, as result, Telkom was able to hoard spectrum without having to worry about the cost of doing so," he said.
ICASA spokesman Sekgoela Joel Sekgoela has conceded that Telkom and Sentech pay R1 540 per MHz for the 3.5G band allocated to them.
Dollar signs
Brierley noted that spectrum used to only be available to state-owned companies, with 90% going to Telkom and the rest to radio and TV stations, and a small amount to two-way radio.
Then there was a boom in the mobile phone industry and both government and ICASA realised that spectrum has value and can generate huge revenues, he added.
"When 3G spectrum was auctioned in Europe, the prices were huge and government saw dollar signs."
Richard Hurst, an analyst with BMI-TechKnowledge, concurs. "It is likely that mobile operators are charged at a higher rate because of the perceived excessive pricing they charge customers and the high profits that they enjoy."
The process
ICASA's discussion document, published in the Government Gazette on 2 November along with the invitation to comment, acknowledges the challenges the regulator faces in allocating spectrum, as well as the evolution of the telecoms sector which calls for the issue to be revisited.
Written submissions from interested parties should reach the regulator by 30 November, ICASA says. Interested parties are also invited to specify whether they would like to make verbal submissions, should ICASA hold hearings.
In a live telephonic interview at GovTech, IT entrepreneur Mark Shuttleworth stated that, for SA to have an effective ICT strategy, it needs to accelerate its thinking around telecommunications regulation and the framing of telecommunication discussion and debate.
Share