Operators hunger for spectrum: report

While buzz surrounds a number of talks involving MTN, Vodacom, Cell C and Telkom, other operators wait in the sidelines – and they’re all hungry for one thing: spectrum.

This is the impression derived by two separate reports in the City Press and Sunday Times, which paint a spectrum-hungry picture of the local telecoms industry in South Africa.

It was reported earlier this week (21 November) that MTN and Telkom were rumoured to be in “sensitive” talks for some sort of deal.

According to analysts quoted in the City Press, the deal – if any – would likely involve some sort of infrastructure sharing agreement; though the possibility of any deal at all points to a bigger need by the telco: spectrum.

Following the lead of Vodacom, which is in talks to buy Neotel for as much as R10 billion, the quoted analysts believe that core to these deals by South Africa’s dominant operators is the desire for spectrum.

The analysts said both MTN and Vodacom are desperate for spectrum to roll out LTE networks, as current refarmed spectrum is being pushed to the limits.

Because of this, operators such as Neotel and Telkom – who have spectrum in abundance – are seen as very tempting prospects, and a way to get hold of spectrum without having to wait for Icasa to dish it out.

However, the process is not and will not be easy, the City Press reported, with another analyst pointing out that competition and regulatory hurdles would most certainly block or hinder the process.

Other interest

But it’s not only the local operators who feel the hunger for spectrum.

According to the Sunday Times, France’s Orange is sitting patiently on the sidelines to see what will happen to the spectrum in the resulting Neotel-Vodacom deal – hopeful that it can snap some of it up for its own purposes.

Sebastien Crozier, CEO of Orange subsidiary Orange Horizons, told Business Times that for Vodacom – which is already a dominant player in SA – to keep Neotel’s spectrum after a deal, would be anti-competitive.

Crozier has previously told BusinessTech that, if Orange had access to spectrum in South Africa, it would become mobile network operator (MNO) “tomorrow”.

“We are always interested in becoming an MNO in a country where there is opportunity. We think that South Africa is a very interesting market.”

It was previously reported by Bloomberg that a number of global players – such as AT&T, China Mobile, America Movil and even Orange – have all shown interest in Vodacom’s parent company, Vodafone, which is a dominant player in Europe, with a number of operations in Africa to tap into, including South Africa.

Vodafone currently owns 65% of Vodacom, worth R122 billion according to the Business Times.

More on spectrum

Neotel spectrum belongs to the state

MTN wants more spectrum

Spectrum trading proposed for South Africa

Battle for spectrum in SA

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Operators hunger for spectrum: report