Telkom South Africa and Rain have won two slots of spectra each at a combined cost of over US$197 million in the first round of auction by the Independent Communications Authority of South Africa (ICASA).
The slots the two won were radio frequency spectrum in the “digital dividend” bands.
Rain agreed to pay over US$99.2 million 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 US$98.6 million 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.
Two other companies were eligible to bid for spectrum in Tuesday’s opt-in round 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. They will be running against the big boys, MTN and Vodacom, which were excluded from Tuesday’s opt-in round.
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 authorized 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].”
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.
It is important to note that South Africa auctioned 2 x 10MHz spectrum in the 800MHz band for US$98.6 million in 2022, but the same chunk of spectrum was auctioned for US$67.5 million in Ghana in 2015. It will be interesting to know how much the same chunk of spectrum will be sold in Ghana today.