THE second network operator could be up and running by the first half of 2004, the Independent Communications Authority of SA (Icasa) said yesterday.

The launch of the rival to Telkom would introduce long- awaited competition in the fixedline telecommunications sector currently dominated by Telkom.

Two Consortium and CommuniTel, which competed for the 51% stake in the licence, said recently that their strategy of competing effectively with Telkom would be to offer superior customer service and quality products . They said engaging in a price war could prompt Telkom to retaliate with predatory prices or cross subsidisation.

Last week the communications department granted both consortiums 13% each of the licence. They will now join parastatals Transtel and Eskom Telecommunications (which hold 15% each) and empowerment company Nexus Connexion (with 19%) to create an integrated entity to rival Telkom.

The remaining 25% will be warehoused by government.

Icasa acting chairman Gerhard Petrick said the licence would be granted after the necessary processes. "The authority (Icasa) will apply the relevant instruments available to itself to ensure that we are within the requirements of the law when considering such a licence," he said.

Petrick said it was "not unrealistic" for the new operator to be operational before June next year.

Transtel said it welcomed communications minister Ivy Matsepe-Casaburri's decision to get the process going again. The parastatal's head of regulatory affairs, Phatang Nkhereanye, said: "We are happy to see that there is movement in this direction, and we hope that this will result in making the licensing of the second operator possible."

Enos Banda, CE of Eskom Enterprises, said all licence stakeholders would meet soon to sign a shareholders' agreement. All stakeholders would have a joint responsibility in the new entity.