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South Africa’s ICASA pushes proposed auctions to May 2017

In the face of strong opposition from the country’s government, South Africa’s regulator ICASA has pushed its proposed 4G auctions from January 2017 into May.

Government backlash against ICASA’s auction proposals began when the regulator invited potential bidders to register their interest. The telecom ministry has begun legal proceedings against ICASA, arguing that the regulator should have waited until the ministry had finalised a spectrum policy that would allow smaller players to participate more actively in the market.

In the face of these accusations of undue haste, ICASA has now put the brakes on the auction proposals and relaxed the black ownership requirements for companies interested in bidding. There are also reports that the regulator will refund winning bidders if the sale is cancelled as a result of the imminent legal challenge.

In July, ICASA proposed selling five blocks of spectrum for their reserve price of $220 million. While this proposal could have raised as much as $1 billion, it contravened the government’s goal of shaking up the market, as the airwaves would simply have been acquired by the highest bidders.

The South African government is aiming to challenge the dominance of MTN and Vodacom by introducing new spectrum policies that will make competition easier for smaller operators. One option that is reportedly on the table is the deployment of a national wholesale network for equal spectrum sharing. However, patience is dwindling among operators as they wait for new spectrum policies to be finalised.

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