Africa desperately needs more innovation in spectrum allocation
Back in 2019, Steve Song at Many Possibilities wrote a blog post explaining how spectrum auctions led to worse outcomes for competition and rural access. The high reserve price of auctions was a barrier to entry to any apart from the large operators. The result was unused spectrum. Zambia is the latest example: In April 2022, it invited bids for spectrum in 800MHz and 2600MHz. MTN and Airtel were awarded spectrum for a price of USD 41.5 million. 40MHz in the 2600MHz band was left unsold. ZICTA plans on putting this up for auction again in Q3 2022, along with 60MHz in the 700MHz band.
This is the perfect opportunity to test new mechanisms for awarding spectrum. The incumbent operators have already had an opportunity to bid for the 2600 MHz spectrum and turned it down. Why go ahead for a second time for the same operators? Instead, there are multiple options that ZICTA could pilot. Steve Song recommends the concept of “secondary use” where spectrum can be used as long as it doesn’t interfere with the primary license holder. But this can be taken further: how about putting unused spectrum into a spectrum park and accepting any bids for an extremely low fee? There is so much research showing the benefits of improved broadband and unused spectrum is literally doing nothing. By putting spectrum in a spectrum park, Zambia could allocate spectrum based on geographic location instead of giving national licenses. Spectrum could be used in a particular area (say a mine or a corporate campus) and the same spectrum could be used in a village in a different location. And the risk to the regulator is really limited. The spectrum is not being used in any case and restrictions could be built such as “use-it-or-lose it” and limited time periods. This is such an opportunity for innovation and it’s a pity that regulators are too scared to take advantage of it.
Other news from around Africa
- Undersea cables: Meta and Google’s undersea cables, slated for launch in 2024 and 2022 respectively, will provide a massive amount of new capacity. Google’s cable will add 20 times more capacity than any other cable at 144 Tbps. Meta’s cable will be even larger at 180 Tbps.
- SIM card registration in Ghana: the deadline has been extended (surprise, surprise) until the 30th of September. It is remarkable how poorly managed these processes have been.
- MTN Nigeria: Revenues increased by 18% over the previous quarter and subscriber numbers increased by 7.6%. There is no stagnation in revenues or subscribers here!
- Ghana: Vodafone’s application to sell to Telecel has been blocked by the National Communications Authority of Ghana because “request did not meet the regulatory threshold for approval to be granted”. The NCA, in the meantime, put out a press release saying that media reports saying that the sale had been blocked were false. In the same press, it confirmed that approval had not been granted. Part of the reason for the confusion is the poorly worded press release and the regulator’s penchant for vague and misleading statements. What is the regulatory threshold for approval? Why not explain exactly what the problem is?