Consultants offer their take on the latest spectrum directive

21 August 2019 Consultancy.co.za

More comments have rolled in surrounding the latest spectrum policy directive from the South African Communications Ministry. According to Louis Avenant at PwC, the lack of clarity in the new directive might translate into another two-year delay in releasing spectrum, which has been on hold for a decade.

The release and auction of spectrum enables competition over network frequencies, thereby improving data connectivity and reducing prices. How to manage the release of this spectrum has been a major source of debate amongst South African policy makers, causing the release to be delayed by years.

The current level of economic stagnation necessitates innovation – largely in the digital sphere – which requires a smoother and more efficient connectivity landscape. Foreign investors are also likely to remain reluctant if data prices in the country remain high, which goes against government objectives. In July, the Communications Minister released a policy directive to help offer clarity on the release of spectrum.

Consultants offer their take on the latest spectrum directive

The directive indicated that a portion of the spectrum will be allocated to a Wholesale Open Access Network (WOAN), where small & medium enterprises as well as firms with diverse ownership will have the opportunity to access the spectrum. However, the practical details surrounding WOAN have not been threshed out, leading many to anticipate further delays.

“On paper it's a really good thing. If this WOAN can come into operation and has the kind of credentials that are intended – driven mostly by SMMEs – and is able to offer the kind of universal service which is required, clearly it would be a good thing for development in SA,” explains Louis Avenant, Senior Associate and Strategy Manager at PwC.

“But at this point it’s not clear how that WOAN is going to operate – who is going to participate, who is going to fund the infrastructure, what will be the relationship between the WOAN and the current operators, what will happen to the current infrastructure? All of those questions are left unanswered,” he added.

Dobek Pater, an analyst at information communications technology consultancy Africa Analysis, has been following the spectrum policy closely as well. According to Pater, the WOAN has the potential to realise a number of government objectives when it comes to spectrum, but structural considerations are key in this regard.


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