Millions of South Africans who rely on the quality of their cellular networks to work remotely will be in for a huge shock at the end of November if Icasa presses ahead with its plan to end mobile operators’ access to the emergency spectrum it made available in April last year, when the country went into level 5 lockdown.
The emergency spectrum was released as a temporary measure, to ease network congestion and enable operators to lower the cost of access to consumers at a time when the demand for broadband services rose exponentially.
Icasa has informed operators that it will take back the temporary spectrum on 30 November. If this happens, operators will have to revert to using their original licensed spectrum, which has already largely been used.
Of course, the underlying issue is that South Africa has been waiting for more than a decade for additional spectrum to be released. This process has been stalled, yet again, with legal challenges from Telkom and MTN. It seems unlikely that the auction of spectrum will be finalised by the end of January 2022, as Icasa intends.
Busi Mavuso, the chief executive of Business Unity SA, has warned that citizens and businesses could be facing “digital load shedding” if Icasa withdraws the emergency spectrum.
Jan Vermeulen, the editor of MyBroadband, says the parallel with Eskom load shedding isn’t entirely accurate. In an interview with RSG Geldsake, he said the likely outcomes of terminating the spectrum were:
- Operators that have rolled out 5G services on the emergency spectrum might have to discontinue these services, unless they can come to an arrangement with operators such as Rain or Liquid Telecom to use their spectrum.
- Most cellular consumers use 4G, and they will experience a major deterioration in service levels, such slower data speeds. He said MyBroadband’s surveys have shown that network quality has improved significantly among operators that have made use of the emergency spectrum over the past 18 months.
Vermeulen said it was possible that a marked deterioration in network quality could result in operators hiking prices in order to “moderate” the use of their services.
He said operators such as MTN and Vodacom have invested in new services such as 5G based on the assumption that, by now, the auction of permanent spectrum would have taken place.
Mavuso said discontinuing the emergency spectrum will make “it harder for workers to connect from home, leaving businesses with a difficult choice – either force workers back into the office, put them on leave or make them redundant”.
She said removing the temporary spectrum would be particularly detrimental to the business outsourcing sector, “the one area of the economy that has managed to grow employment during the pandemic. It relies on good broadband to connect workers for tasks like call centre operations.”
Mavuso points out that South Africa’s good English language skills and location relative to US, European and Asian time zones have enabled it to build a large business servicing global companies.
“Overall, business process outsourcing in South Africa employs 270 000, but McKinsey estimates this could grow to 775 000 by 2030 with two-thirds of those servicing overseas markets. That makes it a substantial export revenue earner. It has been growing at a compound rate of over 24% for the last six years. But it is highly dependent on connectivity, both to the rest of the world and domestically to connect workers to provide services. While workers can be brought back into offices, we remain at adjusted level 2 lockdown in which employers are required to encourage workers to work from home.”
Removing the emergency spectrum will also be detrimental for the township economy, where fixed-line penetration is low, and temporary workers who do not want the cost and long-term contracts of other forms of access, according to Mavuso.
The emergency spectrum is important for online learning and education and the ability to book vaccinations via the Department of Health’s websites from phones for free, she said.
Given the huge implications of Icasa’s decision for the economy, one can only but echo Mavuso’s astonishment that there hasn’t been an outcry from political parties. And although Icasa is an independent regulator, will the government decide to intervene?
