By MKPE ABANG
Amid lingering bickering and confusion within the industry over the sale of Visafone, Nigeria’s hitherto only surviving CDMA operator, to the country’s dominant and leading mobile operator, MTN, the Nigerian Communications Commission (NCC), regulator of the telecom industry, has come out to clarify that although it approved the sale, this did not include the transfer of the licence.
That is to say, the licence and with it the frequency held by Visafone was not approved to be transferred to MTN in the sale, but only the shares of the company.
The NCC, in a statement issued by its Director, Public Affairs, Mr. Tony Ojobo, said the clarification became necessary owing to “speculation in a section of the media that the Nigerian Communications Commission (NCC) the regulatory agency for telecommunication had foreclosed the release of the spectrum held by Visafone to MTN.”
It said “a decision to transfer Visafone licence to MTN has not yet been taken. What has been approved in the transaction is 100% shareholding not licence.”
The alarm on the sale of Visafone to MTN was first raised by IT & Telecom Digest when we broke the story as published in the April 2015 edition of the magazine. In fact, in that story, the then CEO of Visafone, Mr. Srinivasa Venkatappa, denied any knowledge of any negotiations going on, instead he expressed surprise, saying he had no information regarding such a deal.
“I am not aware of such. I am just hearing it from you. And, I cannot comment on rumours or on anything that I have no information about,” he told IT & Telecom Digest when contacted on phone. MTN neither officially denied nor confirmed the story when contacted at the time.
But, sure of our source and story, and as it is uniquely characteristic of IT & Telecom Digest since inception in January 2000, we went ahead and punished the story as the Cover/Lead, with the screaming headline: “MTN Acquires Visafone To Put End To CDMA In Nigeria.” A couple of months down the line, our story was confirmed, as MTN formally declared it had indeed bought Visafone.
That seemed indeed to open the stage even further, for more questions begging for answers, over the Visafone licence and with it, the frequency granted.
In an exclusive interview granted IT & Telecom Digest and published in the April 2016 edition, a former minister of (state) communications, Alhaji Ibrahim Dasuki Nakande, had raised eyebrows over the Visafone sale to MTN, and specifically querying the transfer of the frequency.
Excerpts from that interview:
“…And you will recall that it is this same company (MTN) and the others that followed them that killed all the other CDMA companies that you reported very aptly in one of your recent editions of your magazine, where you asked – where are the CDMA operators? Where is Intercellular, where is Starcomms, where is even the latest, in fact, last one to go under and was bought off by MTN, Visafone? And all this while even the Visafone that MTN bought, it was not because MTN had any interest in Visafone; because they had sacked all the 2,000 staff in the company, plus all other indirect staff – suppliers of various items to the company. They sacked all of them. They were more after the frequency. And NCC is there. That frequency as Visafone is going, should have been reverted to NCC, so that it can be auctioned again. But for somebody to come and buy the frequency is wrong. Because every frequency in a country is national resource. So if you are no more using the frequency, it should revert to the regulator so that proper licensing of that particular frequency through a transparent auction can be done. If you then win, fine and good; if they don’t win, fine and good.
Q: So in other words, you are saying that the frequency Visafone was using, as the company had been bought by MTN, the frequency should revert to the government?
Yes; it should be reverted to the country, to the regulator; so that it can be re-auctioned. Look, by deregulating the sector, we ran away from the monopoly position that NITEL had before over issues of telecommunication in the entire country. And now we are creating a very strong, dominant player by selling all these frequencies to them. Mark you MTN has gone also to buy about 20 per cent of the frequency through the National Broadcasting Commission that would have been used in the roll out of digitisation programme in the broadcast sector. So why is MTN Nigeria piling up all these frequencies? That is like creating strong oligopoly situation, but with one operator being so dominant thereby making nonsense of our laws.
Q: But legally, do you think the regulator can take that Visafone frequency from them being that they bought Visafone?
Yes, they can. Because there was no transparency in the transfer of the frequency. We don’t even know the modalities in which MTN acquired Visafone.
Q: But they had approval of the NCC, the regulator….
It’s possible; but even if you have an approval, was it transparent? Was it open? Did stakeholders in the industry and civil society organisations know about it? Were they brought in to show that this thing is done as openly and as transparently as possible? Because this frequency is owned by Nigeria and Nigerians.”
Early this year, in February, Etisalat, the fourth biggest mobile operator in Nigeria, sued MTN over the Visafone sale specifically querying the acquisition of Visafone’s 800MHz spectrum.
But in the clarification now given by NCC, a follow up to the comments made by its Executive Vice Chairman/CEO, Prof. Umar Garba Danbatta, during the press conference marking his first year anniversary in office, the commission commented further that:
“NCC final approval to the changes in shareholding of Visafone Communications was taken by virtue of section 38 of the Nigerian Communications Act (NCA) 2003. Section 38 of the Act states that “the grant of a licence shall be personal to the licensee and the licence shall not be operated by, assigned, sub-licensed or transferred to any other party unless the prior written approval of the Commission has been granted”.
Mr. Ojobo, in the statement said “this clarification has become necessary in order to allay the fears in some quarters that the frequency had been withheld by the Commission.”
The statement went further:
“Specifically, Visafone Communications Limited with a Universal Access Service Licence (UASL) – deploying Code Division Multiple Access (CDMA) technology applied to the NCC for an approval to effect a change in its shareholding structure by transferring 100% of its shares to MTN Nigeria.
“Having met all the preliminary requirements for grant of approval for change in shareholding structure, the NCC in line with its established procedure granted an Approval-In-Principle to Visafone Communications Limited, subject to fulfilment of conditions to transfer 100% of its shares to MTN Nigeria.
“Having fulfilled the conditions stipulated in the “Approval-In-Principle”, the NCC, in line with its procedure granted a “Final-Approval” to Visafone for the change in its shareholding structure.
Thereafter, Visafone applied for approval to transfer its licence to MTN. The NCC has written to Visafone, clearly stating that a decision was yet to be taken on the transfer of Visafone licence to MTN.”