MTN South Africa is aiming to reach 25% coverage of South Africa’s population with next-generation 5G infrastructure by the end of the year, and 60% by 2025.
This is according to the company’s CEO, Charles Molapisi, who was speaking on a conference call with investors on Friday following the conclusion of communications regulator Icasa’s auction of spectrum this week.
MTN Group CEO Ralph Mupita, speaking on the same call, said the company is pleased with the outcome of the auction, saying the spectrum it acquired – at a cost of R5.2-billion – puts it in good stead to expand its 4G/LTE and 5G coverage across South Africa. MTN secured 100MHz of spectrum across three frequency bands:
20MHz in the 800MHz band
40MHz in the 2.6GHz band
40MHz in the 3.5GHz band
It secured the most frequency of all operators in the 3.5GHz band during the auction. This is seen as the “golden band” for the deployment of 5G services, Mupita said.
Read also South African Banks Move to Protect Consumers in Wake of TransUnion Cyberattack
Meanwhile, Molapisi said that in the next few years, MTN will begin to decommission its 3G network, with 4G and 5G becoming the principal technologies used to deliver telecommunications services to its customers.
He said the company’s allocation of 3.5GHz – 40MHz in total – is sufficient to begin deploying robust 5G solutions to the market. Later, the company intends to work with smaller players that have access to 3.7GHz – also good for 5G technology – to supplement its coverage. But this is not needed for now, he added.
The MTN South Africa CEO said he doesn’t expect any acceleration to the company’s capital expenditure projections for the next three years as a result of the auction outcome. “Any capex acceleration will purely be based on commercial acceleration.”
The new frequency bands that MTN has access to will also allow the operator to become a stronger player in providing fixed-wireless services (in essence, wireless substitutes to fixed-line fibre) — an area where Telkom has historically been a stronger player. Using its new spectrum assets, MTN intends to compete more directly with Telkom in the home broadband market.
Read also South Africa to Provide Internet Access for All Homes by 2024
If Telkom is successful in its suit against Icasa, it may have to forfeit the spectrum it successfully bid for the auction.
One big concern that remains for MTN and other market players is that Icasa’s auction could still be set aside as the result of litigation brought by Telkom that is challenging the way the regulator approached the licensing process. The high court in Pretoria is set to hear the merits of Telkom’s arguments from 11-14 April.
Graham de Vries, MTN South Africa’s GM for regulatory affairs, said on the same call with investors that “serious discussions must now be happening internally at Telkom” following the conclusion of the spectrum auction.
Read also South African Fintech Firm Yoco Buys Web3 Startup Nona Digital
Telkom, which participated in the auction, agreed to pay R2.2-billion for access to two frequency bands, 800MHz and 3.5GHz. If the company is successful in its suit against Icasa, it may have to forfeit the spectrum it successfully bid for the auction, which could harm its own interests, De Vries said.
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry