Advice from WAPA on deploying networks in municipalities

January 12, 2015

Following a recent string of legal battles between municipalities and several telecommunications companies, most notably the judgement of the Supreme Court of Appeal (SCA) in favour of Dark Fibre Africa (DFA) over the Msunduzi municipality, a number of companies are beginning to build wireless networks on public (municipal) property, without the explicit permission of the municipality.

This development is incredibly exciting for the industry but there are a few considerations for both the public and private sector which are important to highlight.

Firstly, the legal background. Under Chapter 4 of the Electronic Communications Act of 2005, licensed network operators have the right to enter onto public or private land for the purpose of constructing and maintaining an electronic communications network.

In practise, however, telecommunications companies recognise that municipalities have a strong interest in what infrastructure is deployed within their jurisdiction and how this is coordinated with other infrastructure projects and aesthetic concerns. Licensees accordingly generally seek to work with municipalities before deploying their networks.

While this has always been a tedious process, some municipalities are increasingly seeing themselves as telecommunications infrastructure and services providers competing with private industry. As such they simply refuse to entertain requests for permission from licensees or declare lengthy moratoria on the granting of wayleaves.

The SCA’s decision in the DFA case means that the holder of an electronic communications network service licence is not required to obtain the consent of a municipality in order to deploy a communications network (fixed line or wireless) within a municipal area. However, a licensee doing so is exercising a public power (i.e. the kind of power normally reserved for the State) and must do so rationally. In exercising this power the company will be subject to the requirements of the Promotion of Administrative Justice Act (PAJA), and is required to take into consideration “applicable law”. The licensee should therefore attempt to work in conjunction with the municipality to operate within its frameworks and policies: if it doesn’t it runs the risk of the municipality being granted urgent relief by a court.

What does this all mean?

Primarily, it means that municipalities are not the sole custodians of the right to build telecommunications networks on public property.

This is a good thing for the industry and the country, because it will – in situations where a municipality is not responding to a wayleave application in good faith – enable the faster deployment and commercialisation of networks in dense areas where there is a clear business case for private ownership of a network.

Second, it highlights the responsibility of the telecommunications companies to act in a manner that is both consistent with applicable laws and in a manner not contrary to objectives of the municipality that may not yet be codified into law.

This is a bit more tricky, as technology often advances faster than the legal and regulatory framework, and faster than municipalities can keep up.

Wireless brings an added complexity. Unlike fibre, where multiple providers can trench and lay fibre right next to each other, with wireless technologies it is crucial for network builders and operators to be good neighbours. For example, in license-exempt bands such as the 2.4Ghz and 5.8Ghz bands in which Wi-Fi operates, it is usually difficult or impossible for multiple networks to co-exist in the same location without interfering with each other.

WAPA therefore makes the following recommendations:

  1. Private industry should recognise the constraints under which most municipalities operate and should endeavour in good faith to communicate openly with the municipality about what is being built, where, and for what purpose, and should make every effort to ensure that the networks are built to support future municipal services being delivered over the network.
  2. Networks (regardless of whether they are owned by private industry or the municipality) should be open access wherever practical, to reduce unnecessary duplication of infrastructure.
  3. Wireless networks on public property operating in license-exempt bands (most specifically Wi-Fi) should also be operated on an open access basis, to promote competition for delivery of consumer and citizen services.
  4. Municipalities should be able to purchase services over the networks on the same terms and conditions as their private counterparts.
  5. Municipalities should, as rapidly as possible, publish any forward guidance around anticipated future uses they might have for municipal telecommunications networks, in order that industry can take them into account.

Says WAPA chairperson Ellie Hagopian: “There is a growing industry consensus that separates the business case for building and managing infrastructure on an open access basis from the business case for competing to deliver services. Networks built in key locations must reflect this way of thinking in order to promote competition and innovation, both for service delivery and for new types of over the top (OTT) citizen services.”

There is not, at present, industry consensus around the definition of wireless open access from either a technical or business perspective. This is one of several subjects where WAPA will provide a public forum for debate and consensus building through the ongoing series of Future Wireless Technologies Forums.