Who is wasting valuable spectrum?
The Independent Communications Authority of South Africa (ICASA) recently announced that the process through which it will allocate ‘scarce spectrum’ will be finalised by the end of May 2010. This process is likely to see many of the larger operators battle it out for valuable 2.6 GHz spectrum which is associated with WiMax and LTE services.
It is uncertain as to exactly what ICASA’s criteria will be to allocate spectrum to an operator, but the process may well include a beauty contest and an auction.
The previous draft regulations included criteria such as a minimum of 30% BEE equity and that an applicant may not have a shareholding of more than 5% in another applicant who has spectrum in the same band.
These requirements will immediately disqualify large players like Vodacom, but the final version of the scarce spectrum allocation regulations may see some of these stipulations relaxed.
Use it or lose it
One of the issues which industry players have been promoting is a use-it-or-lose-it policy where operators who horde spectrum without deploying networks and serving customers would have this spectrum taken back and redistributed.
Sentech currently has 50 MHz of valuable 2.6 GHz spectrum as well as 56 MHz in the 3.5 GHz spectrum band – but the parastatal is not doing anything of value with it. It has been suggested that this spectrum should be taken back, or that Sentech allow other operators to use this spectrum to roll out networks.
ICASA has previously warned that it is considering the recall of radio spectrum from operators that are not using it, but a more proactive approach and strict regulations to control such a process has been encouraged by industry.
“One concern for us is that ICASA has stated that 80% of the spectrum has already been “permanently assigned”. We don’t understand why any assignment of spectrum should be considered to be permanent,” ISPA said in December 2008.
In ISPA’s view, a shared spectrum allocation model (also known as “Lite Licencing”) is the optimal approach in certain spectrum ranges.
Who makes the most of their spectrum?
iBurst CEO Jannie van Zyl recently unveiled a basic model – aptly dubbed the “Paris Principle” – which measures how much an operator is doing with its spectrum.
A “Use it or Lose it” (UILI) value is calculated by the simple formula: Number of Sites / Spectrum in MHz = UILI. The higher the UILI value, the better the operator is performing.
According to Van Zyl ICASA can easily establish a UILI threshold value, attached to a strict time frame, when it allocates spectrum to an operator. If the minimum UILI value is not reached, ICASA can then take back the spectrum and allocate it to another operator.
As an illustration Van Zyl provided a table which assesses the current UILI values for the various operators with WiMax spectrum. The results are as follows:
| Network | Spectrum | Towers | UILI Value |
| Sentech 2.6 GHz | 50 MHz | 0 | 0 |
| Sentech 3.5 GHz | 56 MHz | 0 | 0 |
| Telkom WiMax | 56 MHz | 57 | 1 |
| Neotel WiMax | 56 MHz | 75 | 1.3 |
| iBurst WiMax | 15 MHz | 260 | 17 |
Who is wasting valuable spectrum?<< Discussion
Related Links
ICASA’s spectrum plans welcomed
ICASA commits to spectrum allocation date
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