South Africa's telecoms regulator opened a tender to bid for high-speed wireless broadband licenses on Friday as it seeks to increase access to the Internet and bring down costs for consumers.
The high-speed broadband, known as spectrum, has been packaged into four lots with varying frequencies. The reserve price for the lots starts at three billion rand ($209 million) for a 15-year license, the Independent Communications Authority of South Africa (ICASA) said in a statement.
Bids for licenses are due by Oct. 3 and the auction results will be announced in January next year, ICASA said.
South Africa has pledged to roll out free Wifi services across the country at a cost of around 67 billion rand ($4.4 billion), but access for operators to more bandwidth has been delayed for years.
Government will be able to offset some of the cost through the license auction windfall and an annual fee paid by mobile operators.
"The main aim is to ensure nationwide broadband access for all citizens by 2020," ICASA said.
There are five main firms in South Africa's wireless broadband market, including MTN, Vodacom and partially state-owned operator Telkom .
MTN and Vodacom together control more than 70 percent of the market, a concentration that has led South Africans to pay amongst the highest data costs on the continent.
South Africans pay around $14.10 for one gigabyte of data, the fourth highest out of 17 African countries and compared to lowest-rated Cameroon, where the same bundle cost around $2.10, the World Bank says.
($1 = 14.37 rand)