It is “inevitable” that South African cellular networks will consolidate within the next few years, Graham Mackinnon, chief legal officer at Cell C South Africa, says.
“It will just be the natural lay of the land,” Mackinnon told delegates at the ITU World Telecom conference in Durban this week.
"There will be fewer networks globally – consolidation is the way to go because a standalone investment case for the new technologies coming is becoming less viable. Service based competition across shared infrastructure is where the future of telco is going in the world. The WOAN is a reality now and it’s an example of how wholesale network capacity can be provided."
Telecommunications companies will continue to exist, but that they will compete on a service level instead of a network level, he said.
“I think that there will certainly be much more competition on the service layer and I agree that there is a lot of exciting consumer uses that you can’t actually predict now,” Mackinnon said.
Cell C, South Africa’s third largest cellular network provider, has recently heavily invested in entertainment offering named Black.
By June, Black was the top streaming service among average internet users, Cell C said in its interim results.
Meanwhile, the South African National Assembly is set to debate the Electronic Communications Amendment Bill soon.
The Bill, finalised by Cabinet in August, will force service providers with at least 25% of South Africa network infrastructure to share their infrastructure with competitors.
The Independent Communications Authority of SA (Icasa) is set to prescribe the "cost-oriented" rates these operators can charge their rivals.
Telecommunications Minister Siyabonga Cwele previously told Business Insider South Africa that the Bill will allow for more competition in the cellular market.
That approach will help bring new entrants to the market and cut costs, Cwele said.