South Africa’s telecoms regulator opened a tender to bid for high-speed wireless broadband licenses Friday as it seeks to increase access to the Internet in rural areas and lower data costs for consumers, Reuters reported.
Access to more bandwidth for operators has been delayed for years, despite South Africa promising to roll out free Wi-fi across the country at a cost of around 67 billion rand ($4.4 billion).
South Africans pay around $14.10 for one gigabyte of data, the fourth highest out of 17 African countries. By comparison, the same bundle costs around $2.10 in Cameroon, making it the lowest of the 17, the World Bank says.
There are five main mobile service providers in South Africa’s wireless broadband market, including MTN, Vodacom and partially state-owned operator Telkom.
MTN and Vodacom together control more than 70 percent of the market — part of the reason why South Africans pay some of the highest data costs in Africa, according to Reuters.
The spectrum offering was delayed because it took the government so long to decide how to conduct the process and to publish broadband policies, said Dobek Pater, managing director of Africa Analysis, an ICT market intelligence consultancy in Johannesburg, Bloomberg reported.
The licensing of new spectrum will allow operators to roll out networks “more efficiently” and “provide better quality mobile broadband services,” Pater told Bloomberg. “Ultimately, it would allow South Africa to reach targets of ubiquitous, good quality broadband services.”
The government is selling five blocks at a reserve price of 3 billion rand ($209 million) each, according to the regulator, the Independent Communications Authority of South Africa (ICASA).
The licensing will improve quality and affordability of services and help promote investment in the tech sector, ICASA said in a press release.
Wireless operators have been asking for more spectrum to expand broadband as competition and tight regulation hamper growth in phone services, Bloomberg reported. South Africa’s governing African National Congress promised to extend broadband access to every household by 2020.
In developing markets, expanding broadband access by 10 percent can result in 1.4 percent GDP growth, according to World Bank statistics, Business Day Live reported.
Every 1,000 new subscribers to broadband Internet services can result in 80 new jobs. “These indicators are critical to South Africa, which needs to breach the digital divide, improve its economic growth and create new jobs,” said ICASA spokesman Paseka Maleka on Friday.
The current allocated bandwidth of 567 megahertz IMT (international mobile telecommunications) spectrum needs to be increased, the regulator said, according to an IT Web report.
ICASA has invited telecoms operators to apply for radio frequency spectrum in the 700MHz, 800MHz and 2,600 megahertz bands.
Licensing this spectrum will go a long way toward promoting investment in mobile technology, ICASA said. “South Africa experiences continued growth in demand for more spectrum as a result of significant growth in data traffic.”
