SNO to receive licence on Friday

6 Dec 2005

South Africa’s telecoms regulator, the Independent Communications Authority South Africa (ICASA), says it will formally issue the long awaited licence for the country’s second national operator (SNO) on Friday. The SNO will be the first operator licensed to operate a PSTN in competition to the incumbent, Telkom SA. ICASA had originally said it would distribute the concession in November, if not before, with SNO shareholders confident that the telco would have customers making calls over its network by Christmas.

South Africa’s fixed line market it currently dominated by Telkom and the government is keen to introduce a competitor, but its attempts to launch an SNO have dragged on for years. It eventually approved the operator’s shareholders in January, but it was not until March that the six owners finally sat down to formulate a business plan after black empowerment group Nexus Connexion, which owns a 19% stake in the venture, withdrew its application for a judicial review into the licensing process. Nexus had applied for the injunction over concerns that the Telecoms Minister Ivy Matsepe-Casaburri had exceeded her authority in awarding shares in the SNO to Two Consortium and CommuniTel. Both groups had come up short in their applications for a controlling stake in the new operator but were nonetheless awarded 12.5% each in the SNO. India’s Tata Group is a strategic equity partner in the business.

South Africa