THE long-awaited auction of additional high demand radio frequency is scheduled for March and six telecom operators have submitted applications to telecoms regulator Icasa to participate.
One of the six applicants, Vodacom said in a trading update yesterday the additional spectrum in South Africa would help to extend coverage, improve quality of service and lower the cost to communicate, all of which would support economic growth.
“With the auction scheduled for March 2022, we are working with the government, Icasa (Independent Communications Authority of South Africa) and the other telecommunication operators in South Africa to unlock this economic tailwind and avoid further delays. The allocation of high demand spectrum remains a key strategic priority for the group,” Vodacom Group chief executive Shameel Joosub said.
After some 15 years of delay in the release of additional spectrum licences, Icasa said on Monday it had received applications from MTN, Vodacom, Telkom, Cell C, Rain Networks and Liquid Telecoms. Qualified borders were expected to be announced on February 21, Reuters reported.
Meanwhile, Vodacom grew revenue 6.4 percent to R26.7 billion in the quarter to December 31, 2021 underpinned by strong service revenue growth.
Group service revenue was up 5.3 percent, supported by good demand for connectivity and growth in new services such as financial services.
South Africa service revenue grew 4.5 percent, with “excellent growth” in Vodacom Business.
International service revenue increased 6.7 percent, supported by data and M-Pesa revenue growth.
Financial services revenue increased 12.5 percent to R2bn, with “strong adoption” of the South African super-app, VodaPay.
Joosub said the group was focusing on the economic recovery in markets where it operates through the execution of a “purpose-led six-point plan” that included expanding network coverage and resilience, accelerating support to governments, enhancing digital accessibility and digital adoption, supporting customers as they adapt to new ways of working and promoting financial inclusion.
Two acquisitions announced in November 2021, a majority stake in Vodafone Egypt for R41bn and a strategic stake in the fibre assets of Community Investment Holdings, would be instrumental in this plan, he said.
He said it was pleasing that minority shareholders had voted in favour of the Vodafone Egypt acquisition, as the deal presented good diversification and growth opportunities in a largely unbanked market, and was expected to help in a wider transformation from telco to techco.
The CIVH fibre transaction in South Africa was also expected to facilitate the fibre roll-out programme and enable affordable access to connectivity. Joosub said financial services remained a clear strategic priority. Financial services revenue increased 12.5 percent to breach R2bn for the first time in the quarter.
The M-Pesa platform, including Safaricom, continued to scale at an impressive rate with transaction values up 16.1 percent to exceed R430bn per month.
In South Africa, the launch of the VodaPay super-app in October last year had exceeded expectations by attracting 1.4 million downloads and 1.0 million registered users in its first three months.
The group services 45.7 million customers in total South Africa, an increase of 3.3 percent in a year.
Vodacom’s share price fell 1.47 percent to R144.67 yesterday afternoon, a level that was more than 15 percent higher than a year previously.
BUSINESS REPORT