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High demand spectrum policy – an overview

The Department of Communications has published its highly-anticipated ‘Policy on High Demand Spectrum and Policy Direction on Licensing of a Wireless Open Access Network’ which purports to address South Africa’s longstanding spectrum scarcity challenges. In the policy, the Minister of Communications directs that a portion of unallocated high demand spectrum must first be assigned to a network category of licensees, known as wireless open access networks (each a WOAN) and the remainder must then be assigned to other eligible licensees. Licensees will, as a consequence, be able to either apply for radio frequency spectrum from ICASA (in relation to unallocated radio frequency spectrum made available by ICASA for this purpose) or licensees may seek to enter into a commercial relationship with a WOAN to utilise radio frequency spectrum licensed to a WOAN by ICASA.

The policy envisages that a WOAN will:

• provide licensees with wholesale open access to its networks and facilities;
• facilitate active infrastructure sharing, including for national roaming, radio access network sharing and enabling mobile virtual network operators
• adopt cost-based pricing
• comply with specific network and population coverage targets.
The policy refers to a recent study conducted by the Council Scientific and Industrial Research, which concluded that the following spectrum combinations should be considered as the minimum for a WOAN:
• 2 x 25 MHz of 800MHz band (Band 20);
• 2 x 20 MHz of 2600 MHz FDD band (Band 7); and
• 25 MHz of 2600 MHz TDD band (Band 38).
The policy also states that preferential treatment must be given to a WOAN concerning assignment of certain spectrum within the 700MHz, 800MHz and 2600MHz bands. A WOAN must:
• be a consortium of persons, at least 70% owned by South Africans, that participate voluntarily;
• comply with the empowerment requirements contemplated in the Electronic Communications Act;
• include diversity ownership to ensure meaningful participation of all entities involved including SMMEs, and to prevent monopolistic behaviour.
• include effective participation by targeted groups, including women, youth and persons with disabilities; and may include public entities as shareholders provided that a WOAN may not be a public entity, under the Public Finance Management Act.

The policy directs the ICASA to issue an invitation to apply (each an ITA) for individual electronic communications network service licences in the specific context of a WOAN. We await ICASA’s response to the policy (both in the form of regulations and ITAs to be issued in response to the policy). ICASA has also been directed by the Minister to investigate and report on the spectrum requirements of 5G in bands lower than 6GHz and the millimetre wave bands in order to inform the licensing of 5G candidate bands. The Minister will thereafter issue a separate policy direction on the 5G candidate bands.

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