Analysts are largely of the view the competition authorities erred in prohibiting the proposed R14 billion merger between Vodacom and Maziv.
Market watchers and industry players are largely of the view that South Africa’s competition authorities erred in prohibiting the proposed R14 billion merger between mobile operator Vodacom and fibre infrastructure company Maziv .by the Competition Tribunal that it had prohibited the proposed merger deal.
This, after the competition watchdog found the proposed deal would likely prevent or lessen competition in several markets and that the conditions offered by the merging parties did not fully address the resultant harm to competition. She adds that this prohibition impacts broader socio-economic objectives. “More specifically, this transaction was positioned to not only expand reach and efficiency of the merging parties, but also to open doors for SMMEs to scale up their operations, benefit from increased resources and integrate more robustly into the sector.”
“This merger represented a pivotalopportunity to demonstrate the sector’s commitment to large-scaletransformation, but without necessary investments, the pathway to universalconnectivity remains challenging.”Arthur Goldstuck, MD of World Wide Worx, says the tribunal may have made the right decision in sticking to the letter of the Competition Commission’s mandate, “but I would argue that they made a major mistake in terms of the spirit of that mandate”.
“We have seen heroic efforts from small and large telecoms and internet operators at achieving this goal without support from government, and with very little enabling action, policy or legislation. It is ironic and sad that state entities step in only to block expansion of these efforts, instead of ways to facilitate and enable them,” Goldstuck says.
“Building broadband infrastructure costs a lot of money. This is achieved better on a large scale by large entities, with the ability to raise the required funds. Without these large-scale actors in the market, higher connectivity levels will be achieved but possibly over a longer period of time,” Pater says.
Competition Tribunal Competition Commission Fibre Vodacom Maziv Association Of Comms And Technology Progressive Blacks In ICT Nomvuyiso Batyi Arthur Goldstuck Dobek Pater Leon Rolls
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