On a bustling Johannesburg street, commuters glance at their screens while a silent negotiation unfolds in boardrooms: the country’s two largest mobile operators, MTN and Vodacom, have formally asked the Competition Commission for an exemption from parts of South Africa’s competition legislation.
The request, reported by MyBroadband, asks regulators to relax rules that normally prevent dominant players from engaging in activities that could limit competition. In plain terms, an exemption would allow the operators to collaborate in ways that are usually prohibited, for example, sharing network infrastructure or coordinating certain pricing strategies.
Competition law in South Africa, enforced by the Competition Commission, is designed to keep markets open and prevent any one firm from abusing market power. Exemptions are rare and are only granted when the applicant can demonstrate a clear public benefit that outweighs the risk of reduced competition.
Why the exemption matters for small businesses
For the owner of a small retail shop or a start-up that relies on mobile data to run point-of-sale systems, any change in the cost or quality of mobile services can have a direct impact on the bottom line. If the exemption leads to shared towers and cheaper wholesale rates, those savings could trickle down to end-users, potentially lowering subscription fees. Conversely, if the exemption enables the operators to coordinate prices, small businesses could face higher costs without the usual market pressure that keeps prices in check.
What “network sharing” actually means
The distinction the Commission will have to draw is between two very different kinds of co-operation, and it explains why an application like this is not simply waved through. Passive sharing means splitting the physical site: the mast, the land, the power supply, the security fence. That is largely uncontroversial, because each operator still runs its own radio equipment and still competes on coverage and speed. Active sharing goes further, pooling the radio electronics and sometimes the spectrum itself, at which point the two networks begin to look like one network with two billing departments. Passive sharing cuts duplicated civil-engineering costs without much competitive downside; active sharing cuts far more cost but erodes the technical basis on which the two firms can meaningfully compete. Where on that spectrum this request sits is the question that will decide it, and the operators have not made their specific asks public.
Historically, South Africa has granted limited exemptions in sectors where the public interest is clear, for instance, the electricity industry has allowed certain joint-venture arrangements to improve grid reliability. Those precedents show that regulators weigh the trade-off between efficiency gains and the risk of market dominance.
What remains unknown is how the Competition Commission will evaluate the request. The commission will likely assess whether the proposed collaboration truly benefits consumers and whether safeguards can be put in place to prevent anti-competitive outcomes. No timeline has been announced, and the operators have not disclosed the specific provisions they wish to be exempted from.
Industry observers note that the mobile market in South Africa is already highly concentrated, with MTN and Vodacom together holding more than 70% of the subscriber base. Any regulatory relief that deepens that concentration could invite scrutiny from consumer groups and smaller rivals such as Cell C and Telkom Mobile, who have previously complained about market access barriers.
For SMEs, the key question is whether the exemption will translate into lower costs or better service quality. Until the commission’s decision is made public, the potential impact remains speculative. Small business owners should keep an eye on any announcements from the regulator, as they may signal upcoming changes in pricing structures or network availability.
In the meantime, the request highlights a broader tension in South Africa’s telecom sector: the need to invest in costly network upgrades, especially in rural areas, versus the imperative to maintain a competitive market that protects consumer choice. How the Competition Commission balances those competing priorities will shape the mobile landscape for years to come.
