Vodacom goes to war against spectrum pooling
"We can confirm that Vodacom has filed papers in the High Court, requesting an interdict against MTN, Cell C and Liquid Telecom from transmitting on, or controlling, each other’s spectrum, pending a review of ICASA’s decision to authorise spectrum sharing between the parties," a Vodacom spokesperson said in an email statement.
"It is our considered view that spectrum pooling is a material change of control event that has wide-ranging implications for both competitors and consumers. As such, in terms of the Electronic Communications Act 36 of 2005 (the ECA), ICASA should have followed a public consultation process, prior to making a decision on the spectrum sharing applications of MTN, Cell C and Liquid Telecom.”
After exhausting other options, Vodacom was left with little choice, but to approach the High Court for relief
Vodacom, the plaintiff in this case, has raised allegations that the deals were unlawfully approved, giving MTN an unfair advantage. They are challenging the legitimacy of the agreements, arguing that they distort the competitive balance in the market.
Vodacom argues that these deals have been sanctioned without due process, which violates the principles of fair competition.
What’s the counter argument?
On the other side of the dispute is MTN, the defendant. They are currently in the process of reviewing Vodacom's court papers and are consulting with their legal advisors. They are partnered with Cell C and Liquid Intelligent Technologies in the spectrum pooling arrangements that are now under scrutiny.
“We confirm that we have received court papers filed by Vodacom on 20 May 2024,” said a Liquid Intelligent Technologies spokesperson in answer to Bizcommunity requests for comment.
“We are currently reviewing the papers and are, unable to provide any views and/or share any substantive comments on the litigation at this point."
These partnerships are central to the case, as they are the subject of Vodacom's allegations.
Icasa, is now facing scrutiny over its decision-making process. Their role in this matter is under examination, as the fairness of their approval process is being questioned.
Meanwhile, Telkom is calling for a review of all spectrum-sharing deals. This adds another layer of complexity to the situation, indicating that the issue may have broader implications for the industry.
Vodacom claims that the spectrum pooling deals were done in secret, violate the Electronic Communications Act, and give MTN an unfair competitive edge. They argue that MTN can utilise more spectrum than legally allowed, resulting in a superior network performance.
How does SA benefit?
If Vodacom wins, the court could declare the spectrum pooling deals unlawful, compelling MTN to discontinue the practice.
This would result in a more level playing field for all mobile operators in South Africa, ensuring that no single company has an undue advantage over the others.
By curbing MTN's spectrum advantage, other operators could become more competitive. This increased competition could potentially lead to improved services and lower prices for consumers.
The case could also prompt Icasa to review its processes and regulations regarding spectrum allocation. Which could bring more transparency and fairness to future deals, leading to a more robust and equitable regulatory framework.
