What government decides will have a big impact on potential rivals. Johnnic, the owner of cellular operator MTN and signal distributor Orbicom, is one local group that's been positioning itself to be part of a rival network to Telkom. Analysts say a full service rival to Telkom would cost R14bn to set up and that a foreign telecoms operator would be needed as an equity partner to provide international connectivity, branding, foreign direct investment and technical and commercial skills. But there are still issues like the third cellular licence that need to be resolved. At the time of going to press, the process, which was to have created a rival to MTN and Vodacom, was still held up in court proceedings, following allegations of corruption, political interference and procedural irregularities.
Markets hate unpredictability.
Formed out of the merger of the discredited broadcasting and telecoms regulatory watchdogs, the IBA and Satra, Icasa must prove it has the power to regulate fairly in the favour of all investors and consumers and that it won't be bullied by powerful vested interests. These issues are also worrying Telkom. Telkom needs to know what the regulatory environment will look like before it decides on its optional, sixth year of exclusivity, says Nxasana. Our licence is clear. Government cannot unreasonably deny us this request.