According to industry reports, Cell C has forfeited the spectrum it won at auction in March 2022 after failing to pay the US$15 million it bid for the precious resource. Vodacom regulatory affairs executive Andrew Barendse stated this in an affidavit filed as part of an unrelated court case. In response, Vodacom is taking legal action against the Independent Communications Authority of South Africa (Icasa) for approving certain spectrum pooling deals between MTN and other network operators.
According to Icasa’s rules governing the spectrum auction, Cell C has lost its spectrum assignment by not making the payment.
The news of Cell C’s loss of spectrum comes as a surprise, given the company’s previous indications that it was working towards settling its debt to Icasa. Cell C had claimed to have made some payments and was in discussions with Icasa to settle the remaining balance, although the exact amount paid was not disclosed.
The spectrum auction held by Icasa in March 2022 was a pivotal event in the telecommunications industry. It involved a substantial amount of high-demand radio frequency spectrum, a crucial resource for mobile network operators. Vodacom and MTN emerged as the top bidders, underscoring the competitive nature of the auction.
Cell C’s financial difficulties, which have been widely reported, were a contributing factor to its loss of spectrum. The company had been facing challenges in raising the necessary funds, a situation that was known in the industry. However, Cell C had expressed confidence in its ongoing discussions with the regulator regarding a payment plan.
Despite its financial difficulties, Cell C had positive news in terms of network quality. Recent reports showed a significant improvement in its network quality, with an increase in average download speed from 28.70Mbps to 39.32Mbps between Q1 2023 and Q1 2024. This improvement enabled Cell C to surpass Telkom and regain its third place behind MTN and Vodacom for the quarter.
Cell C’s Chief Technology Officer Schalk Visser attributed this success to the company’s partnering strategy with MTN and Vodacom rather than solely focusing on building and maintaining its own radio access network. This approach has allowed customers to enjoy improved connectivity and uninterrupted data services in areas that were previously underserved.
