South African wholesale open access network put on hold

South African wholesale open access network put on hold

Plan for licensing a wholesale open-access network (WOAN) in South Africa have been put on hold by the regulator, the Independent Communications Authority of South Africa (ICASA).

This is quite a turnabout for the regulator. As part of the timetable published for South Africa’s planned spectrum auction next year a consultative document related to WOAN licensing was due late last week.

As for what caused the change of heart, an ICASA statement said, “Given the sensitivity of the spectrum licensing process and the ongoing consultation processes in that regard, as well as numerous continuous related considerations including legal imperatives, ICASA has resolved to temporarily suspend the timetable relating to the licensing of the WOAN.”

It continued, “This is done to allow the conclusion of the consultation process relating to the permanent licensing of the IMT spectrum, thus enabling the Authority to interrogate the impact of the outcomes on the licensing of the WOAN.”

It may seem rather late in the day to, as ICASA puts it, “engage other international jurisdictions to draw lessons from their experiences on the licensing of a typical WOAN”.

However, given that one of the highest-profile examples, ALTAN Redes (on which the South African WOAN was reportedly partly modelled), has experienced widely reported issues, including bankruptcy, it may be that ICASA thought it prudent to take a step back, even at this late stage.

The South African WOAN is intended to encourage competition at the services layer, rather than the infrastructure layer. It creates a private sector-led wholesale entity with multiple investors able to serve internet service providers and others. Operators Vodacom and MTN would be required to buy 30 percent of the new entity’s available capacity, though whether the spectrum offered will be used for 4G, 5G or both isn’t entirely clear.

However, the concept is not too popular with private sector players. The operator association the GSMA said two years ago, “Citizens are promised better coverage, more competition, and as a result, more affordable prices. However, turning this vision into a working reality with an impact that goes beyond what traditional networks can achieve is difficult.”

ICASA now plans to outline its plans for the WOAN by the end of March next year – approximately when the next spectrum auction is due to be concluded. ICASA says spectrum will still be set aside for the WOAN during the licensing process.

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