Vodacom outlines plans for its new spectrum assets, with 5G a big focus

Vodacom Group will use its newly acquired spectrum assets in South Africa to build out 4G and 5G infrastructure and grow its presence in the home broadband market with fixed-wireless services, CEO Shameel Joosub said in an interview.

Speaking to TechCentral on Thursday, Joosub said Vodacom’s acquisition of a big chunk of contiguous spectrum in the 2.6GHz band was particularly a “big win for us”. The 80MHz it bought in that band will allow it to offer improved 4G services and to roll out 5G.

It will pair that spectrum with the 20MHz it bought in the 700MHz band – still being used by television broadcasters – to offer both 5G coverage and capacity, Joosub said.

That said, Vodacom, which plans to spend R10.5-billion on its network in South Africa this year, won’t be too hasty in rolling out 5G, noting that there are only about 800 000 devices on its network today that support this next generation wireless technology.

“It is still early days, in my view,” he said. “What you’ll see is a 5G strategy centred on fixed-wireless… You build the network according to how the device uptake happens.”

The focus on fixed-wireless services is likely to pitch Vodacom more directly against other mobile operators, especially Telkom and Cell C, which have built meaningful businesses selling high-capped and uncapped, fibre-like wireless broadband services into the home market.

The allocation of spectrum in the 2.6GHz band “is definitely an opportunity for us to be more relevant in the fixed-wireless space”, Joosub said. “We have increased [our presence] in fixed-wireless access quite considerably, but with [the additional] spectrum, we can play in a much bigger role.”

Vodacom spent R5.4-billion in the spectrum auction. For this money, it got:

• 20MHz at 700MHz
• 80MHz at 2.6GHz
• 10MHz at 3.5GHz

Rival MTN spent R5.2-billion buying:

• 20MHz at 800MHz
• 40MHz at 2.6GHz (half of what Vodacom bought)
• 40MHz at 3.5GHz (four times what Vodacom bought)

Telkom was also successful in supplementing its existing holdings at 3.5GHz with a further 22MHz of spectrum, giving it 50MHz of contiguous spectrum in that band.

This puts all three companies — Vodacom, MTN and Telkom — in a strong position to compete aggressively in 4G and 5G home broadband services with Rain, which also bought 20MHz at 2.6GHz to supplement its holdings, and Cell C.

Although questions have been raised about what Vodacom can do with only a sliver of spectrum at 3.5GHz, Joosub said the company will “make full utilisation” of the assignment. Cell C also bought 10MHz in the band, paying R288.2-million for it.  – © 2022 NewsCentral Media