Liquid targets early 2020 for South African 5G wholesale launch

Liquid Telecom has said it plans to launch a 5G wholesale network in all major South African cities in early 2020.

The firm will make use of the 56 MHz of 3.5 GHz spectrum, building a wholesale network before most of the domestic operators have a chance to bid for their own 5G spectrum licenses. The team has previously said it has no intention of launches retail services in the market.

“This breakthrough 5G wholesale service will create innovation in every aspect of South African society and industry,” said Liquid Chairman Strive Masiyiwa.

“For the first time, mobile network operators and ISPs will have open access to Liquid Telecom’s new 5G mobile network. The launch of the service also underscores Liquid Telecom’s vision to bring high-speed connectivity to everyone.”

Although Liquid Telecom has a licence for the 3.5 GHz spectrum bands, the South African regulator, ICASA, is yet to decide plans for the rest. State-owned Telkom also has a licence, though it has not unveiled plans yet. MTN and Vodacom are yet to get their hands on the valuable assets, offering a very interesting opportunity for Liquid Telecom and its 5G wholesale network.

The unallocated 116 MHz of 3.5 GHz spectrum will be auctioned next year, though both MTN and Vodacom have said they are ready for aggressive deployments now. Rain is the only other to have access to 3.6 GHz spectrum, though it is rolling out fixed wireless access, as opposed to mobile, services currently.

“This is a milestone moment for Liquid Telecom South Africa,” said Liquid Telecom CEO Nic Rudnick.

“Our wholesale operating partners can exploit our new ultra-fast 5G roaming network to build the next generation of communications and make innovation possible, anytime, anywhere. 5G will facilitate real-time remote collaboration, improved business efficiency and lower costs – ultimately driving growth in the South African economy.”

Although it might seem unusual to discuss 5G for Africa considering the other challenges faced across the continent, South Africa should not be considered the norm.

In the most recent ‘State of the ICT Sector’ report from ICASA, population coverage for 4G is estimated at 85.7%, while it also estimates smartphone penetration is as high as 81.7%. These figures might be a bit massaged, as other estimates put the numbers noticeably lower, though South Africa is certainly ahead of other nations across the continent.

Looking at 5G penetration, Ovum estimates there could be some interest in 5G over the coming years. The business case for a Liquid Telecom wholesale network certainly seems to be present as it is assumed there is consumer appetite for 5G. The likes of MTN and Vodacom could be lured into a lucrative agreement while deploying their own networks over the next few years.

Total South African 5G subscriptions – Ovum World Information Service estimates
Telco 2021 2022
Vodacom 488,244 1,043,443
Telkom 250,025 436,656
MTN 329,575 707,212
Cell C N/A 380,522

China Telecom and Liquid tie up in search for scale

China Telecom Global and Liquid Telecom have announced a new collaboration to extend their respective network coverage in the African and Asian markets.

The partnership will allow both of the telcos to offer additional network solutions and services to enterprise and wholesale customers, as well as increasing coverage across two challenging regions. China Telecom Global has already established a Point-of-Presence (PoP) at Liquid Telecom’s East Africa Data Centre in Nairobi, though this will be extended facilities in Johannesburg and Cape Town.

“With more than 50 countries in the region, Africa is nonetheless the booming new market with the highest development rate just after Asia, and a very important market for CTG,” said Changhai Liu, Managing Director of China Telecom, Africa and Middle East. “This collaboration will enable both CTG and Liquid Telecom better serve our customers and explore untapped business potential for further development. Under this partnership, we are well positioned to enhance the connectivity and network infrastructure in both regions.”

“This partnership with China Telecom Global reflects the strong global demand for world-class network services across Africa. Our combined service and network capabilities will be of great value to multinationals operating in some of the fastest growing economies across Africa and Asia-Pacific,” said Willem Marais, Group Chief Business Development Officer at Liquid Telecom.

Partnerships like this should be encouraged in regions where investments can be challenging to justify. While telcos in more developed markets can build business cases around investment in network infrastructure, the difference in economics between the developed and developing nations mean the rules are not the same. Telcos in developing nations aren’t even playing the same game, as economy of scale becomes much more difficult to realise.