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Johannesburg - A huge setback that could end in the Constitutional Court is how industry players sum up Communications Minister Ivy Matsepe-Casaburri's decision to appeal the Altech court verdict.
On Monday threats were made that the entire communications industry could drag her into the country's highest court.
"Should this appeal succeed, it would be a huge blow for competition in South African telecommunications, which has long been stifled by legislation," said Huge Group chief executive Anton Potgieter.
On Friday last week Matsepe-Casaburri announced that she was planning to appeal the court decision allowing Altech and other industry players to build their own networks.
Potgieter sharply criticised the ministry's policy of managed liberalisation.
"The policy has had limited success so far and there is real merit in now allowing the market itself to take the lead in tackling the high costs and restricted network access characteristic of our industry," he said.
John Holdsworth, the chief executive of communications company ECN, which initially opposed the Altech case, agrees.
"This is a minister out of touch with the industry," he said, adding that the application for appeal would lead to further delays in the issuing of licences.
"It will definitely have a negative impact on the communications sector," he added.
Standing as one
According to Holdsworth, the minister's action is "a thinly disguised attempt to protect existing network suppliers, and Telkom in particular".
"We are standing as one behind Altech and, should the appeal succeed, will launch a class action from the entire communications sector to drag the minister to the Constitutional Court," he added.
Altech chief executive Craig Venter is in the US and could not be reached for comment.
The ministry had previously dug its heels in, stating that its policy of managed liberalisation would ensure that communications companies did not overlook the rural areas should they begin to roll out their networks.
"The Altech decision would lead to niche networks being established in rural areas," Holdsworth pointed out.
Potgieter said he could not understand the minister having taken her decision despite overwhelming support for the Altech ruling.
Nevertheless he was optimistic about the outcome for the sector.
"We look forward to the day when clients can have free access to a wide range of communication products."
- Fin24.com