South Africa could shelve plan for national cellular network
Cabinet has approved a policy amendment for public comment that would see South Africa’s plan for a national wholesale wireless network operator shelved.
Dubbed the wireless open-access network (WOAN), the proposal to establish such a national cellular carrier has been controversial.
Proponents argue that a WOAN is a formidable tool to introduce competition for Vodacom and MTN in the South African market.
Detractors point out that such a scheme has not worked anywhere in the world.
The WOAN would essentially be required to build a radio access network to rival those created by Vodacom and MTN over decades. Billions of rands have been invested into these networks every year.
Government’s aim with the WOAN was to foster service-level competition in the cellular industry similar to South Africa’s vibrant Internet service provider community.
Last year a poster child for WOANs globally, Mexico’s Altán Redes, filed for bankruptcy in July. Altán Redes was developing Mexico’s WOAN, called Red Compartida.
The company promised to continue its network deployment while it renegotiated its debts.
Before Cabinet announced its decision on Thursday, the Independent Communication Authority of South Africa (Icasa) had already opted to delay the WOAN’s licensing at the end of last year.
This was to accelerate the licensing of sought-after radio frequency spectrum without having to deal with the fraught issue of the WOAN simultaneously.
Spectrum is the raw network capacity mobile operators use to communicate between their towers and cellular devices.
Icasa is in the middle of holding its spectrum auction. During the exclusive first round on Tuesday, open only to smaller players, Rain and Telkom walked away with chunks of spectrum after bidding a combined R2.7 billion.
The auction is expected to inject a minimum of R8 billion into South Africa’s national fiscus — provided a court case from Telkom doesn’t overturn the whole process.
Against the backdrop of these ongoing events and challenges, Cabinet has announced its decision to approve, for public comment, the amendment government’s policy on high-demand spectrum and the policy direction on the licensing of a WOAN to be published.
“Cabinet had in 2019 approved this policy on high-demand spectrum and the policy direction on the licensing of a WOAN to give effect to the Electronic Communications Act, 2005 (Act 36 of 2005),” it stated.
“The licensing of high-demand spectrum remains critical to the country’s economic recovery drive.”
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