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AYO set to join big players in line to bid for share of 4G spectrum

Telecommunications and Postal Services Minister Siyabonga Cwele. Supplied

Telecommunications and Postal Services Minister Siyabonga Cwele. Supplied

Published Oct 18, 2018


JOHANNESBURG - AYO Technology Solutions (AYO), the largest black-empowered JSE-listed ICT group in the country, yesterday looked set to join the big wireless operators in bidding for a share of the licensing of spectrum in the 700MHz, 800MHz and 2.6GHz bands when they are put on auction by the end of March.

This follows Minister of Telecommunications and Postal Services Siyabonga Cwele last week confirming that 4G spectrum would be put on the auction block to existing telecoms wireless operators as well as black economic empowerment participants.

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Cwele said the government was working on a March 31 deadline to put up the 4G spectrum on auction, while it worked towards a 5G spectrum availability by 2020.

Icasa (Independent Communications Authority of South Africa) spokesperson Palesa Maleka also confirmed that various options of disposing of the 4G/LTE technology were being looked at.

Wireless carriers such as Vodacom and MTN have frequently taken the government to task for lack of the sale of spectrum, which they claim hinders their growth.

Advocate Wallace Mgoqi, the chairperson of AYO, said the company welcomed the government's decision for Icasa to sell spectrum for 4G services and 5G licenses in early 2019 and 2020. “For the first time, black ICT companies will have the opportunity to own such spectrum and use it particularly for data purposes,” he said.

AYO announced its intention to deepen empowerment and broaden accessibility to bandwidth through:

* Supporting smaller black ICT companies by inviting smaller black SMMEs in the ICT and telecommunications sector to partner with it in the auction for these licences. It said the sector had been largely dominated by established telecom operators.

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* AYO will also invite black ICT companies who want to form part of the consortium for the radio frequencies, but who also want to use the radio frequencies for their businesses. In addition, AYO will enter into partnerships with existing global multinational partners for the bidding process.

* AYO's management team will build a model that allows other smaller black ICT businesses to use such spectrum for the growth of their own businesses in line with the transformation objectives of the ICT industry.

AYO said in a statement that it would use some of the capital, which it raised on its listing on the JSE in December last year to bid for these licensing opportunities and to invest in forward-thinking businesses that would use the frequency of these licences for digitalisation, data and content.

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AYO recently concluded transactions with various black businesses, including acquiring 51percent equity in Sizwe IT as well as a fintech tie-up with Vunani Capital.

“AYO is currently, among other things, building up a substantial business in data and artificial intelligence for Africa and will make announcements of such partnerships and investments when the company is ready to do so,” said Mgoqi.

As part of a broad stimulus plan for the economy announced recently by President Cyril Ramaphosa, he said South Africa would release “high-demand” spectrum to telecommunications operators urgently.

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This will happen before a legislative process to amend the Electronic Communications Act is completed.

“In the next few weeks, the government will begin the process of allocating high-demand radio spectrum,” Ramaphosa said.

“This will unlock significant value in the telecoms sector (and) will increase competition, promote investment and reduce data costs.”


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