According to reports in the South African technology press, the long-planned migration of operator Cell C’s network traffic to rival operator MTN is definitely happening – but there may be a few more hurdles yet.
This will be a three-year transition towards a full national roaming arrangement under which MTN will carry all of Cell C’s network traffic. Before investment in this strategy is significantly increased, however, MTN Group will want to be satisfied that Cell C’s financial situation has stabilised.
The first phase of the roaming agreement involved the sale of excess capacity in peri-urban and rural areas to Cell C. The second phase will open up roaming in urban areas and lead the way for Cell C’s radio access network traffic to transition onto MTN infrastructure.
Cell C will, apparently, still run a core network, as only its last-mile radio access network will use MTN’s infrastructure.
Nevertheless, this approach would offer a clear saving for Cell C. Winding down its radio access network would allow it to decommission its tower infrastructure, which it would therefore no longer have to manage.
Where this would leave Cell C’s status as an operator is hard to say. It insists it is not going to become an MVNO. Cell C CEO Craigie Stevenson has been quoted on South African IT website MyBroadband as saying: “We have got our own spectrum, licence, number range, brand, customers and core billing.”
Precisely how the system will work in practice and what the spectrum will be used for is not going to be clear, however, until Cell C’s financial position is sorted out.
Cell C’s recapitalisation is key, as is paying back the money it owes to MTN for its ongoing roaming agreement; Cell C appears to be three months’ behind with this payment.
However, both parties are optimistic that the new business model will eventually be implemented.