Ruling stuns SA telecoms market

2008-08-29 00:00

Johannesburg — The South African telecommunications landscape has been fundamentally changed as of yesterday morning when a judge ruled in favour of Altech Autopage’s High Court application essentially appealing for all network service providers to be allowed to build their own networks.

It effectively takes the “managed” part out of the liberalisation process and could throw the market wide open to competitive forces.

The judgement means that telecommunications regulator Icasa – unless it appeals – would have to cast aside its competitive process for determining which value-added network service providers (Vans) qualify for Electronic Communications Network Service (ECNS) licences under the Electronic Communications Act, and grant these to any operators that want to build their own networks.

The winners will be those operators that have the funding, and importantly the black economic empowerment (BEE) credentials (Icasa says they’ll need 51% BEE ownership), to be able to successfully qualify.

The matter dates back to a 2004 ministerial determination in which Ivy Matsepe-Casaburri made a statement that as of February 1, 2005, “value-added network services may also be provided by telecommunications facilities other than those provided by Telkom and the second national operator or any of them”. Icasa interpreted this as that the Vans could self-provide, but later backtracked. The minister argued she had never intended that to be the case, and this is the line that she and Icasa fought in response to Altech’s court application.

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