Telkom tactics will hurt South Africa’s economy — Vodacom CEO

Vodacom CEO Shameel Joosub has warned that the impending court battle over the country’s much-anticipated spectrum auction will significantly impact the economy if it is not resolved urgently, the Sunday Times reports.

Telkom has applied for an urgent interdict to stop ICASA from proceeding with the auction, but MTN, Vodacom, and Rain have challenged this.

Key to Telkom’s application is that the auction includes the 700MHz to 800MHz band, which is still used by broadcasters — meaning those who acquire this spectrum would not have immediate access to it.

This range of radio frequency spectrum is among the most sought-after for mobile operators. It provides greater indoor penetration and is used to cover larger geographical areas, making it helpful in rolling out coverage to rural areas.

While Telkom has substantially more spectrum than MTN or Vodacom overall, it does not have access to spectrum below 1,000MHz, which is why issues regarding this spectrum are a particular sticking point for the company.

Joosub argued that the auction is critical to improving South Africa’s economy, and delays will have severe economic implications.

“These ongoing delays are holding South Africa’s development back and come at a time when the need for additional spectrum is getting increasingly desperate,” said Joosub.

“It’s no secret that telecommunications infrastructure is key to the growth of any economy. This latest impasse needs to be resolved urgently, or another year of economic opportunity will be lost.”

Telkom has other concerns regarding the spectrum auction, including a cap of 187MHz of overall spectrum per network operator.

Telkom already holds about 142MHz of spectrum for cellular technologies, meaning Telkom would only be allowed to acquire about 45MHz of spectrum under current auction rules.

“Icasa’s mistake is that it assumes spectrum in the hands of each player has the same value and has the same impact on the market,” Telkom regulatory affairs head Siyabonga Mahlangu told MyBroadband.

Mahlangu highlighted that the ITU suggests mobile network operators need 80-100MHz of spectrum to offer 5G services.

Since it would require an additional 62MHz to meet this minimum expectation, the rules effectively make it impossible for Telkom to launch efficient 5G services.

Icasa has been critical of Telkom’s efforts to halt the spectrum auction.

It said that “narrow and selfish commercial interests” should give way to the overriding public good of cheaper data, universal access to efficient and reliable connectivity, and high-speed broadband transmission.

Competing mobile networks have also expressed their disdain for Telkom’s tactics.

“Delaying the process is not in the best interests of competition or consumers, especially with the demand created by the online migration and need to be connected,” said Cell C chief legal officer Zahir Williams.

“We cannot have a repeat of 2021, where the entire process was delayed for another full year, and that on the back of 14 years of no additional spectrum being added to the industry,” said MTN SA CEO Charles Molapisi.

Additionally, Joosub has previously accused Telkom of doing everything in its power told to delay the spectrum auction because it wants to maintain its competitive advantage as the operator with the most spectrum and the most extensive fibre network footprint.

Now read: Goliath vs Goliath vs Goliath — South Africa’s spectrum showdown