It seems like yesterday; but 14 years have goneby since the Global system for Mobile communication, GSM debuted in Nigeria.
The auction actually commenced on January 17 and ended on January 19, 2001. Radio Spectrum International, RSI, Charles Rivers Associates, Chief Afe Babalola (SAN) and Mr.Paul Usoro (SAN) were consultants to the Nigerian Communications Commission (NCC) on the auction.
Although, this licensing regime ushered in the ubiquitous GSM which consequently changed the face of the telecoms landscape in Africa and made Nigeria the haven for telecommunications investors, the story is not all- through rosy.
However, industry practitioners who took a critical look at the road this sector has taken from the country’s paltry 450, 000 connected lines in 2001 to over 135 million active subscribers as at the end of 2014, are seeing tremendous growth with multiplier effects in all other sectors of the economy, including the banking, education, e-commerce/retailing, agriculture, medicine, media, oil and gas, among other sectors.
Even at that, the problem of perennial low quality of service in the sector, apparently puts a clog in the wheel of progress and perhaps slowed down the pace of growth that would have made the country greater.
Besides poor quality of service with its attendant problem of dropped calls and poor voice clarity, there are other issues that bother on poor services from the operators, like unsolicited text messages, unwanted and nauseating telemarketing and locked-messages which infringe on subscribers’ right of privacy.
Increased investments
Despite these deluge of problems, Foreign direct Investment inflow in the sector is on the rise.
According to the Executive Vice Chairman of NCC, Dr, Eugene Juwah, “Over $32 billion investment has been recorded in the sector as at June 2014 from $50 million in year 2001. The investment stood at $18 billion in 2010 and $25 billion in 2012.”
With the investment, telecoms companies have been able to successfully deploy 68,124 kilometre of fibre optic cabling as at the end of December, 2013 while in 2014 alone, additional 38, 000 kilometre of fibre optic cables were laid, representing an increase of about 44.2 per cent investment in fibre optic cabling by the telecoms companies last year alone.
Increased base stations
Meanwhile, in the last 14 years, telecoms companies in Nigeria have also increased their base transceiver stations (BTS) expansion efforts from few thousands to over 27, 000, making it possible for more people to have access to telephone services thus covering many hitherto unserved and underserved communities across the country.
Beyond carrying voice signals, the industry operators are also making their BTS either 2G-enabled or 3G-enabled to be able to carry adequate data services, with the country relying on the 11 terabyte of internet capacity brought into the country by the likes of Main One, Glo1, West African Cable Systems (WACS), among others.
According to data from the Ministry of Communication Technology, between 2013 and December, 2014, 2G-enabled sites have increased from 22, 578 to 28,289 while 3G-enabled sites have increased from less than 10,000 to 15,048 during the same period.
USPF’s subsidy-based backbone transmission
In a similar vein, the commission said through the Universal Service Provision Fund (USPF), it has bridged the gap between the served and underserved areas of the country, with a subsidy-based project designed to facilitate the connection of rural and semi-urban areas to the national transmission backbone infrastructure with the intention to facilitate the build-out of backbone transmission infrastructure.
The project is expected to be implemented in all the 774 local government areas in Nigeria, using targeted subsidies.
Just recently, the Minister of Communication Technology, Mrs Omobola Johnson, said that about 1, 200 kilometres of fibre optic cabling has also been run so far, through the project.
The minister listed that over 170 base stations, in total, had been deployed only through the USPF to un-served and underserved areas by the end of 2014, with each of the base stations serving a cluster of communities.
Consequently, telecoms sector has grown from obscurity to limelight, emerging as a major contributor to the country’s economy with its current contribution of 10 per cent to the national Gross Domestic Product (GDP).
These metrics contributed immensely in the International Telecommunication Union, ITU’s rating of the country as the fastest growing telecommunications market for five consecutive years. Perhaps, other areas of positive impact of the sector in 14 years includes the areas of service tariff, cost of owning communication devices and cost of acquiring telephone line.
From N50 per minute of phone call in 2001, the cost has crashed by 78 per cent today as telecoms subscribers now make call for as low as N10 or N9 per minute across networks.
The NCC adopted in 2013 Progressive reduction interconnect termination rates whereby New Entrants and small operators had termination rates for voice services pegged at N4.90 in April 2013, N4.40 in April 2014 and by April this year it will drop to N3.90 for all networks.
Also, SIM cards are almost given pro bono by telecoms networks today, whereas, 14 years ago, Nigerians were paying between N25, 000 and N20, 000 to acquire a SIM card with only net-worth individuals being able to own telephone lines.
The NCC introduced the Mobile Number Portability (MNP) whereby subscribers are at liberty to navigate across networks without losing their SIM number. And because operators are afraid of losing their customers, they have had to be on their toes on areas of service provision in order not to lose subscribers.
The sector can fare better
In a similar submission, Chairman, Association of Licensed Telecoms Operators of Nigeria (ALTON), Mr Gbenga Adebayo, said the telecoms sector has performed well as an enabler of most of the ICT-driven activities that have brought about efficiency in the country.
He said: “Today, we bank with ease, we do online cash transfers, we use Automated Teller Machines (ATM), mobile money operators, e-wallet in agriculture, telemedicine, among others, but we forget that all of these activities, in addition to their traditional duty of providing voice and internet service, run on the networks of telecoms companies. Yet, cashless transactions are on the rise every day.
“So, rather than criticize the sector for its little shortcomings, we should commend the players for helping the country to manage all these loads. I can imagine what will happen if telecoms companies decide not to carry any traffic (voice and data) in a day the way we witness it in the oil sector, where companies suddenly stop petrol distribution, thereby creating scarcity,” Adebayo argued.
Although the sector may have not fared so badly in 14 years, there are however room for improvement.
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