The cabinet has scrapped plans to launch a wholesale open-access network (Woan).
This terminates a controversial scheme government introduced years ago, hoping that it would increase competition in South Africa’s mobile market.
The decision was taken at a cabinet meeting on Wednesday. A statement on Thursday said that it ‘approved the amendment of the policy on high-demand spectrum and the policy direction on the licensing of a Woan to be published for public comment’.
‘The proposed amendments remove the requirements to license the Woan.’
The Woan has long been a key policy plank of the ANC’s for the telecommunications industry. The decision to scrap it comes after the only high-profile example of a Woan elsewhere in the world, Mexico’s Red Compartida, which went into bankruptcy last year.
South Africa’s planned Woan — a much-derided concept among local operators and telecoms experts — was partly modelled on Mexico’s experience. The Mexican plan had often been held up by the South African government as an example of a successful Woan. Government has long bemoaned Vodacom and MTN’s market “dominance”.
Vodacom and MTN would have been required to buy 30% of the new entity’s available capacity. Former minister of communication Siyabonga Cwele had wanted the Woan to have a monopoly over new spectrum, threatening investment in South Africa’s telecoms industry. Apparently the idea of a Woan has not been supported by the current minister, Khumbudzo Ntshavheni.
Few commercial entities have publicly expressed interest in investing in the Woan.
The cabinet’s decision comes in the same week that the Independent Communications Authority of SA auctions spectrum to mobile operators to provide broadband services. The auction is expected to conclude by the end of the week.
[Image: https://pixabay.com/photos/cyberspace-data-wire-electronic-2784907/]