Businesses will now have to contend with the prospect of a major cut in bandwidth for those who connect through cellphone networks, as regulatory body Independent Communications Authority of South Africa (Icasa) is moving ahead with a plan to terminate access to emergency spectrum at the end of November.
“This will make it harder for workers to connect from home, leaving businesses with a difficult choice – either force workers back into the office, put them on leave or make them redundant.
“The move by Icasa has particularly hit the business process outsourcing sector, the one area of the economy that has managed to grow employment during the pandemic. It relies on good broadband to connect workers for tasks like call centre operations.
“Efficient mobile broadband is particularly important for township sectors which do not have high fixed line penetration and temporary workers who do not want the cost and long-term contracts of other forms of access,” Business Leadership South Africa (BLSA) CEO Busi Mavuso comments in her weekly newsletter.
She notes that the end-November deadline is imminent, but that there has been no comment from government about the decision.
“The emergency spectrum was allocated in terms of national disaster regulations as the pandemic was breaking last year. It was one of the most positive moves in the fight against the pandemic and included requirements to provide free educational platforms and material so learners could continue their education from home.
“It also has been important in the vaccine effort, with anyone able to book vaccines through the Department of Health websites from their phones for free. All that will go with the termination of the temporary licences,” Mavuso notes
She posits that the decision has also damaged confidence in an increasingly important part of the country’s economy, namely the call centre industry.
Mavuso points out that the country’s quality of English language skills and position relative to US, European and Asian time zones has enabled it to build a large business servicing sector to support global companies.
Overall, business process outsourcing in South Africa employs 270 000, but management consulting firm McKinsey estimates this could grow to 775 000 by 2030, with two-thirds of those servicing overseas markets, making it a considerable export revenue earner, Mavuso states, noting that it has been growing at a compound rate of over 24% for the last six years.
However, she emphasises that it is highly dependent on connectivity, both to the rest of the world and domestically.
“While workers can be brought back into offices, we remain at adjusted Level 2 lockdown in which employers are required to encourage workers to work from home.
“Given that there are still 700 000 fewer jobs than before the pandemic, the last thing we should be doing is damaging confidence in areas that have been creating jobs. Indeed, we should be doing everything possible to enable the economy to recover,” Mavuso asserts.
She notes that what the country actually requires is a long-term solution to the shortage of spectrum available in South Africa.
Mavuso points out that this is a process that has been under way for over a decade, but that it remains marred by policy sequencing problems and litigation. Therefore, emergency spectrum should remain in place until that process is resolved, she argues.
“The Icasa decision on emergency spectrum may add to the litigation that it is embroiled in. Icasa is legally required to consider the interests of end-users when it makes its decisions, but I cannot imagine any possible justification for this decision from an end-user’s perspective. It makes it harder for people to obtain information to fight the pandemic and harder for them to work safely.
“While Icasa is an independent regulator, I am also astounded there hasn’t been a stronger outcry from the political level, especially given the approaching local government elections. The prospect of digital load-shedding is surely one that voters will care about,” Mavuso says.