Rain, Telkom splash R2.7-billion in spectrum auction

Telkom and Rain have emerged as the winners in the first round of South Africa’s radio frequency spectrum auction, securing spectrum in the “digital dividend” bands for a combined total spend of nearly R2.7-billion.

Rain agreed to pay R1.51-billion for access to two chunks of 10MHz of spectrum in the 700MHz band and for 10MHz of the 2.6GHz band, while Telkom agreed to cough up R1.5-billion for two chunks of 10MHz in the 800MHz band.

It’s the first time both operators will have access to frequencies below 1GHz, which are useful for providing coverage over wide areas and improving signal quality in buildings in urban areas.

The other companies eligible to bid for spectrum in the opt-in round on Tuesday – which is the first day of the spectrum auction being led by communications regulator Icasa – were Cell C and Liquid Intelligent Technologies. But only Cell C submitted a valid bid, which was ultimately unsuccessful.

Liquid and Cell C can still take part in the second phase of the auction, which starts on Thursday — and both are expected to do so. MTN and Vodacom, which were excluded from the opt-in round, will also participate in the auction from Thursday.

For the opt-in phase, bidders submitted their bids in person between 10am and midday on Tuesday. Bid evaluations were carried out in front of all authorised representatives following the close of the bids’ submission window, Icasa said in a statement.

“History has been made this morning,” said Icasa chairman Keabetswe Modimoeng. “We are highly grateful to the participants during this phase [of the auction].”

Main stage

The main auction stage will commence on Thursday using an online auction platform. All six qualified bidders will be eligible to bid for spectrum in this stage between 9am and 5pm on business days until the main auction stage concludes, Icasa said.

Icasa is proceeding with the auction despite pending litigation against the process by Telkom. Telkom wants the regulator to go back to the drawing board because it is concerned about how it has handled the licensing process and its impact on competition.

TechCentral reported earlier on Tuesday that Telkom is now seeking a “structural or supervisory” interdict against Icasa, meaning it wants the court to supervise Icasa in a subsequent auction after the current one has been invalidated. It accused the regulator of licensing spectrum “unlawfully”.

The company, which has secured a mid-April date for an urgent hearing on the merits of its case, wants Icasa to revisit its invitation to apply on various grounds, including that television broadcasters are still using some of the spectrum being auctioned.

Icasa said it has “notes the latest developments in the review application filed by Telkom” but said there is “currently no legal impediment to the auction proceeding”.

“As matters stand, Telkom itself is a participant in the process; and as per the outcomes of today, has emerged as a winning bidder in the opt-in auction. The authority remains committed to successfully completing the auction and will strongly oppose all efforts aimed at undoing the economic and social gains arising from the process.”  — © 2022 NewsCentral Media

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