JOHANNESBURG – South Africa’s telecoms regulator said on Wednesday it will invite mobile operators to apply to bid for spectrum for 4G and next generation 5G networks from Oct. 2, with the country’s first-ever auctions expected to take place by the end of March.
Allocation of frequency bands for wireless communication is seen as key to expanding broadband services, especially 5G, in Africa’s most industrialised economy, where the high cost of telecommunications is a barrier to doing business.
“The authority will make available 406 MHz of spectrum for the provision of mobile broadband services in South Africa,” Independent Communications Authority of South Africa (ICASA) chairperson Keabetswe Modimoeng told journalists.
Data costs have come down after mobile operators were forced to cut prices, but they argue that prices can’t drop significantly until regulators auction the much needed spectrum.
There are five main mobile operators in South Africa – MTN, Vodacom, partially state-owned operator Telkom, unlisted Cell C and Rain.
The operators will be able to bid for spectrum in the 700 MHz, 800 MHz, 2.6 GHz and 3.5 GHz bands. Reserve prices for lots in the 3.5 GHz band, key for 5G, range from 9.8 million rand ($587,688.5) to 75.6 million rand, Modimoeng said.
The closing date for interested bidders to register is December 28, while the closing date for the government’s wireless open access network (WOAN) invite is March 30, 2021.
The WOAN, which will be owned by private sector players, is the government’s way of creating a shared model for spectrum allocation rather than auctioning the resource to the highest bidder.
Successful licensees of high-demand spectrum will be obliged to procure a minimum of 30% national capacity from the WOAN “collectively as soon as the WOAN is operational for a period of seven years,” Modimoeng said.
Earlier this month ICASA said it now plans to auction high-demand spectrum by no later than the end of March 2021, pushing back the process by three-months.
As a result mobile operators will keep the temporary spectrum awarded to them under the COVID-19 national state of disaster regulations until the auction by end March. Operators were meant to hand it over on Nov.30.
ICASA had been at odds with the government over the allocation of these licences. The government went to court in 2016, blocking the auction after ICASA unexpectedly announced the sale in July 2016.