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Government telecommunications law, if adopted without radical changes, will have a "devastating" effect on the ICT sector, destroying the incentives that have led to almost universal mobile coverage in South Africa.
This is reflected in MTN, which submitted written comments on the controversial draft law on the amendment of electronic communications in anticipation of parliamentary hearings on the subject on Thursday.
Vodacom, in his submission (see article), called on the government not to hastily pbad the bill through Parliament, saying it "should pause and carefully consider the far-reaching (and we say clearly unfavorable) implications of the draft law." law for the sector and consumers ".
In its submission, the pillars of MTN, what it calls government policy, reverse competition in infrastructure and describe the proposal to "impose open generalized and cost-based access in a competitive market" as "draconian and irrational ". This policy change will have "a devastating effect on the model that has generated more than 100 billion rand investment over the past decade".
"This will destroy the incentives that have provided 3G coverage over 98%, a world-clbad 4G network (currently 90%, despite the absence of LTE spectrum) and increasing investments in fiber, thus putting at risk the future of 5G in South Africa. "
The strong submissions suggest that Vodacom and MTN are about to run out of options to revise the bill and are now preparing to deal with the government's political changes that they believe will seriously undermine the sector.
& # 39; Unthinkable & # 39;
"Why would MTN (or any other player in the network) continue to invest in its fixed network and mobile network while it can access the Telkom or Vodacom network at its current cost?" Said MTN in its brief .
"In turn, why would Telkom and Vodacom continue to invest in network expansion and innovation if they do not derive any competitive advantage, but simply revenue based on costs from MTN (and other service providers)? "
MTN has stated that such a proposal would be "unthinkable" in any other sector. This was tantamount to forcing airlines to offer cost-rated seats to their competitors. "Which airlines would ever invest in aircraft on this basis?"
It would be like asking automakers to build cars for their rivals at no cost. "Which automakers would invest again in a plant in South Africa?" Asked MTN.
The bill is also unconstitutional, he said. It violates the property clause of the constitution, does not meet the requirement of rationality imposed by Article 1 (c) and Article 22, and is "unduly vague".
He warned that the abandonment of network competition in favor of a cost-based service model had "no international precedent in telecommunications".
"Despite a long political debate, the cost / benefit ratio of this seismic change has not been quantified and MTN's concerns have always been ignored."
He also warned that the government's plan to create a wholesale open access network, or Woan, is "untested internationally" and "risks reducing competition between the networks".
"South Africa could resign itself to a common standard and a poor quality network (the Woan)," said MTN. "While MTN is supportive of a hybrid model of fair game rules (where commercial operators and the Woan coexist), a policy that links the release of an excessive spectrum to the license of a contentious Woan risk to delay spectrum availability if necessary for South Africa. . "
He added that the communications regulator Icasa should reserve spectrum at Woan and immediately allocate spectrum to commercial operators.
"These issues are as complex as they are crucial to South Africa's economic future. MTN insists that they be debated in a thoughtful manner and not according to the proposed hurried schedule. There is too much risk in experimenting with untested and unqualified policies for such an important sector and an engine of growth. "
This article has been published with the permission of TechCentral. The original publication can be viewed here.
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