Extra Spectrum Assigned Amid Data Demand Surges in South Africa

The Independent Communications Authority of South Africa (ICASA) has granted mobile operators MTN, Vodacom and Telkom emergency spectrum to deal with an increase in data demand during the coronavirus lockdown.

ICASA said it considered applications for temporary radio frequency spectrum assignments in the 700 MHz, 800 MHz, 2300 MHz, 2600 MHz and 3500 MHz bands, including the use of television white spaces (TVWS), in an effort to ensure connectivity during the National State of Disaster. 

The aim is to ease network congestion, maintain good quality of broadband services for consumers, and enable service providers to lower cost of access.

While the lockdown has been extremely damaging or even fatal to many businesses, the mobile telecom sector has proved resilient and even has benefited to some extent, due of course to the greatly increased demand for mobile services for remote working, personal communication and entertainment to pass the time while in quarantine.

The benefit, though, would remain potential only if networks were not able to meet the data demands in a timely and efficient manner. So the freeing up and allocation of spectrum by national regulatory authorities is key if congestion is to be avoided or even mitigated.

In South Africa, Vodacom for example has recorded a 40 percent surge in data traffic since the start of the coronavirus lockdown in that country three weeks ago. While it is true that some of this growth can be attributed to the fact that Vodacom, MTN and some other operators recently zero-rated a number of websites, including university portals, Vodacom said that working from home and home entertainment drove most of the new demand. The trend may even continue a restrictions are loosened and even after the lockdown ends completely, if usage patterns change due to the change in habits. 

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Telkom Ramps Up Support Solutions for SMB Sector

South African operator Telkom has made the delivery of accessible and value-adding functionality for information and communications technology (ICT) systems specifically tailored to small and medium-sized businesses (SMBs) a priority for 2015. The operator considers the SMB sector to be a leading contributor to the country’s economic growth. Telkom plans to provide converged offerings of fixed, mobile, data, cloud and IT solutions to its business customers. According to Thami Magazi, managing executive of Telkom’s SMB service division, the products that are being developed will go a long way in enhancing efforts aimed at bringing the second economy into the first. In other words, helping these businesses grow will result in less of a disparity between South Africa’s wealthiest and poorest people.

As we have written previously, the telecom industry plays a major role in the economic growth of developing countries. In this environment, Telkom will most likely create new revenue sources with the creation of services for SMBs. As the country’s incumbent fixed line provider, but smallest mobile operator, Telkom is wise to expand its offerings for SMBs. From recent reports, it appears that all of South Africa’s operators have begun to follow a dual strategy of fixed and mobile. Its second-largest national operator, Neotel, has been gaining market share in the fixed line sector, and Vodacom, the country’s largest mobile operator, is awaiting final approval for its planned acquisition of it. The government has created Broadband InfraCo, a national infrastructure company, to provide inexpensive backbone network capacity to service providers. Additionally, Vodacom and MTN have moved into the fixed line and national fiber sector under a converged, service-neutral licensing arrangement, and lastly all of the major players have access to the various international submarine fiber optic cables that are now available in the county. While fixed line is still a small sector in South Africa, these recent events make it a competitive one and Telkom is smart to focus on new services for its business customers, not only to produce new revenue but also as a way to remain as the country’s fixed line leader.

The above item appeared in a recent issue of The Tarifica Alert, a weekly resource that analyzes noteworthy developments in the telecoms industry from around the world. To access all of the latest articles and issues or to speak with the research team: http://www.tarifica.com/contactus.aspx