@finweek finweek finweekmagazine finweek^ 15 August 2019^45in depth telecommunications industry
and power struggles within government. It also missed
a self-imposed deadline of June 2018, set by former
communications minister Faith Muthambi.
The new policy directive also pushed out the timeline for
the use of fifth-generation wireless networking technology
(5G) in SA, which is being rolled out globally this year. It
said that consideration of 5G spectrum would be covered
in a separate policy directive sometime in 2020, after
preparation of a report which would be presented
to the minister six months after the next World
Radiocommunication Conference in late November.
The news will be a disappointment to operators
that have begun trial deployment of the high-speed
technology in SA – particularly for data-only network
operator Rain, the only company to have launched a 5G
commercial network so far.
In many ways the absence of 5G is not a pressing
concern for SA — but it is seen as crucial to the
deployment of Internet of Things technology, self-
driving cars, and smart cities. It will also provide the
infrastructure to carry huge amounts of data and spur
innovation in new technologies, such as industrial
automation and medical monitoring.
“We are always playing catchup with the rest of the
world and it’s exactly because of this kind of mindset,”
Avenant said. “If current operators deem it viable to
introduce 5G technology, there’s no reason not to do
that, because it’s going to create new markets.”
An economic report from the GSMA in July
predicted that releasing 5G capacity will spur economic
growth globally and provide a $5.2bn boost to gross
domestic product in sub-Saharan Africa alone by 2034.
Faster internet access matters — a World Bank
study this year showed that its arrival in sub-Saharan
Africa nearly two decades ago increased the
probability that an individual was employed by up
to 13%, with the impact for unskilled workers more
positive than in wealthy countries.
The mobile ecosystem in SA generated 7.6% of GDP,
or $28.5bn of value added to the economy in 2018, the
GSMA said.
“Supported by the right policy environment, this
economic impact is expected to rise to $30bn by 2023,
due to the productivity benefits from increasing mobile
internet penetration,” it said. ■
[email protected]Mariam Isa is a freelance journalist who came to SA in 2000 as chief financial correspondent for Reuters news
agency after working in the Middle East, the UK and Sweden, covering topics ranging from war to oil, as well as
politics and economics. She joined Business Day as economics editor in 2007 and left in 2014 to write on a wider
range of subjects for several publications in SA and in the UK.Neither Vodacom nor MTN have responded to
the policy directive, saying that they are reviewing the
document and will comment in due course. Analysts say
they are effectively being nudged out of the market and
may find it difficult to get adequate returns on the capital
investment which they have already ploughed into their
infrastructure.
Louis Avenant, manager at PwC’s Strategy&, says
it could potentially take two years before the WOAN
becomes operational, although the spectrum
earmarked for existing players could be released
within the coming months.
“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,” he says.
“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.”
So far WOANs have a poor track record. The Global
System for Mobile Communications (GSMA) – a
trade body representing the interests of the industry
worldwide – warned two years ago that they are not
the best solution for providing better coverage and
more affordable prices.
Dobek Pater, director of business development at ICT
consultancy Africa Analysis, says the structure of the
WOAN will be key to ensure that it does not become
dysfunctional.
“It can be a vehicle that delivers what the
government wants, that provides good-quality
broadband service to rural areas, but it needs to
operate like a commercial entity. It needs to be efficiently
managed by one or two parties to make sure that it
functions properly.”
Pater says a spectrum auction to existing operators is
possible in a few months but would probably take place in
the first quarter of next year. The longest delay would be
in the release of the spectrum occupied by broadcasters,
as they are not required to switch from analogue to digital
technology before the middle of next year.
SA missed the International Telecommunication
Union’s digital migration deadline of June 2015 due to
disagreements among broadcasters, legal wranglingWAITING^ FOR^ CHEAP
ER^ DATA?
The^ quick^ release^ of^ spectrum^ could^ change^ that^ –^ but^ continued^ indecisio
n by policymakers^
Naila Govan-Vassen
Research manager at
Research ICT AfricaShameel Joosub
CEO of VodacomOperators that secure their
own spectrum will
have to buy30%
of their national capacity
from the WOAN for at
least five years.Photos:^ Gallo/Getty^ Images|^researchictafrica.net