South Africa’s plan to auction fresh cellular network capacity

Telkom believes the Independent Communications Authority of South Africa (Icasa) will make 280 MHz of high-demand radio frequency spectrum available this year.

This is according to the mobile network’s trading update for the first three quarters of the 2025 financial year.

“Icasa will commence with preparing for the next high-demand spectrum licensing process during the current year,” Telkom said.

“It is anticipated that around 280 MHz of additional spectrum, including spectrum in the sub 1 GHz and mid-range bands, will be made available for licensing.”

The spectrum will allow mobile operators to increase the capacity and performance of their networks, potentially paving the way for cheaper data costs over the long term.

However, the spectrum auction Telkom is referring to was initially supposed to take place at the end of March 2024 but was delayed due to a request by the mobile operator.

In its interim results for the 2023/2024 financial year, Telkom said it wanted the licensing process pushed back to 2025 because Icasa still needed to complete “studies” in preparation for the auction.

It also said the current challenging economic environment, including the impact of load-shedding, would make it particularly difficult for Telkom and other market participants to partake in the auction.

Telkom CEO Serame Taukobong told MyBroadband at the time that operators spent money upfront in researching spectrum allocations.

“I think if you look at what’s being made available right now, it is very unclear from Icasa,” Taukobong said.

“That is our concern. It’s quite premature to be issuing this spectrum at this time.”

Icasa announced in May 2024 that it planned to auction off the high-demand radio frequency spectrum in its 2025/26 financial year.

“The first step in ICASA’s project plan is to consider the competition issues relevant to the licensing of additional high-demand spectrum, including the impact of direct and indirect access to spectrum,” Telkom said in its trading update.

Spectrum pooling war

Telkom also referred to Vodacom’s review application against the spectrum pooling agreements between Cell C, MTN, and Liquid Technologies.

It noted that the outcome of this application, which will be heard by the High Court on 13 and 14 February, will affect how Icasa conducts the spectrum licensing process.

Vodacom launched legal action against Icasa in June 2024, alleging that the regulator allowed MTN to secretly pool spectrum belonging to Cell C and Liquid Intelligent Technologies with its own.

It said MTN amassed large blocks of precious spectrum this way, giving it a huge and unfair advantage.

Because spectrum is the raw bandwidth that mobile networks use to communicate between their towers and customer devices like smartphones, it is viewed as the lifeblood of any wireless network carrier.

MTN warned that if Vodacom’s interdict succeeds, it would degrade the quality, speed, and capacity of MTN’s network, impacting a substantial portion of the population.

It would impact not only MTN subscribers but also wholesale Internet Service Providers, Mobile Virtual Network Operators (MVNOs), its public and private sector customers, and members of the public who are reliant on these entities.

It warned that operators roaming on the MTN network, like Cell C and Telkom, would also be affected.

Vodacom also argued that the pooling agreements constitute notifiable mergers that should have been lodged with the Competition Commission.

Since Icasa did not follow proper procedure and Vodacom believes the agreements were unlawful, it wants the approvals set aside.

MTN argued that spectrum pooling arrangements enhance competition in any market and generate efficiencies for all parties involved.

“MTN and its pooling partners applied to Icasa to pool spectrum in early 2022, leveraging off the positive impact of temporary spectrum pooling arrangements approved during the Covid–19 pandemic,” it explained.