R12-billion 4G auction is anti-black

The decision by the Independent Communications Authority of South Africa to auction frequency spectrum is wrong, Dimension Data Africa and Convergence Partners chair Andile Ngcaba told Business Times.

Ncgaba, a former director-general at the Department of Communications, warned that an auction only serves to further entrench existing players.

His argument is that only Vodacom, Telkom, and MTN have deep enough pockets to pay the R3-billion reserve prices on one of the four lots of spectrum being auctioned.

ICASA’s plan would disenfranchise black people, not empower them, said Ngcaba.

The licensing of this spectrum should be used to allow new entrepreneurs into the telecoms market, he said.

As it stands, the auction benefits only entrenched industry interests at the expense of black investors and entrepreneurs.

Expect delays

A fight between ICASA and the Department of Telecommunications and Postal Services will also delay the issuing of new spectrum by three to five years.

Ncgaba warned it would become an even bigger mess than South Africa’s migration to digital terrestrial TV.

This is because it may be taken all the way to the Constitutional Court to settle “whose role is what,” said Ncgaba.

LTE and 4G spectrum auction

ICASA announced in July it had issued an invitation to apply for high-demand frequency spectrum, with the aim to auction four lots of spectrum with a reserve price of R3-billion on each.

A fifth lot was held in reserve to issue at a later time.

The spectrum in question must be used for mobile telecommunications services, and would be ideal for LTE and 4G networks.

The images below show how the spectrum was divided into five lots. ICASA plans to auction lots B, C, D, and E.

ICASA spectrum auction 2016 - 700MHz

ICASA spectrum auction 2016 - 800MHz

ICASA spectrum auction 2016 - 2600MHz

The full article is available in the Sunday Times of 14 August 2016.

More on ICASA’s spectrum auction plans

MTN preparing for spectrum auction

Icasa hits back at government over spectrum auction

Cell C worried about high prices, government support for spectrum auction

The BEE and speed requirements of South Africa’s R12-billion spectrum auction

LTE spectrum auction for South Africa – bidding will start at R3 billion

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R12-billion 4G auction is anti-black