When it comes to lowering the cost of mobile data in South Africa, the most important factor is the availability of spectrum.
This is according to Vodacom CEO Shameel Joosub, who was speaking to MyBroadband in an interview following the recent publication of the mobile operator’s latest financial results.
ICASA is progressing in terms of its upcoming spectrum auction, which will see networks bidding on a variety of spectrum lots in an effort to gain more of this precious resource and improve their operational efficiency.
Joosub said that the acquisition of additional spectrum would help Vodacom to reduce the cost of producing data, therefore allowing it to make prices cheaper.
“I think it’s a multitude of different issues, but it will help to reduce the cost of producing a GB of data – that we are sure of,” he said.
“Now part of it should be when do we get access to the spectrum? Because remember even if the auction happens, the digital migration hasn’t happened.”
Digital migration refers to the migration from analogue broadcasting signals using spectrum in lower frequency ranges to a digital signal, which is crucial for improving mobile coverage at a reduced cost.
“There is that piece as well – so you will get some relief on 2.6GHz and 3.5GHz, but you need the 700MHz and 800MHz spectrum that will provide major relief.”
Battery costs influence mobile data prices
Joosub said that spectrum is not the only important factor in dropping mobile data prices, however – South Africa’s lack of power stability is also a major influence on the cost to carry data.
“Access to spectrum goes a long way in terms of helping, but things like power security are also important,” he said.
“I mean just to put it into perspective, we spent R1 billion on batteries in the last six months, which we shouldn’t be doing.”
“That is just to ensure that people’s networks can stay up when we have rolling blackouts,” he said.
South Africa has had its worst year for load-shedding yet, despite the reduced demand as a result of the COVID-19 pandemic and subsequent lockdown.
Criminals have also taken to stealing increasing numbers of batteries from mobile base stations, requiring networks to replace this infrastructure.
This means mobile networks have been forced to buy new batteries on a regular basis, which pushes up their cost of carrying data.
“I think we also need to look at some of these costs,” Joosub said. “I think power is extremely important and adds an additional cost, but spectrum obviously plays the biggest role in a network of the cost of data.”