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NCC: Committed To Broadband For All

Key Actors of the Nigerian Broadband Revolution (Part I)

Nigerian Communications Commission

As the major driver of the National Broadband Plan implementation, the Nigerian Communications Commission (NCC) has over the years shown great commitments to the broadband revolution the same way it successfully midwifed the mobile revolution, which affords virtually all Nigerians opportunity, not only to make and receive calls at their convenience, but also at affordable costs. While their might have been some setbacks in the implementation of some of the regulator’s broadband plans due to some circumstances beyond its control, all signals from the NCC and its body language show a regulator deeply committed and passionately dedicated to the broadband project.

Campaign for Investments

Certainly, the whole world is now aware that the next target in the Nigerian telecommunications industry is broadband; all thanks to the NCC, which has taken it as a matter of priority to attract international investors to the broadband project. At every international forum where it is opportune to make presentation, NCC has never for once shied away from drawing the world’s attention to the country’s broadband pursuit and calling for supports and investments to make it a success. The regulator’s campaigns for investments is premised on the fact that all the plans and strategies require adequate funding which can only be attracted through investments by private investors from within and outside the shores of the country.

Hence, at the last ITU Telecom World forum in Qatar last year, the NCC’s message was loud and clear to the whole world about the need for investment in Broadaband. The immediate past Minister of Technology, Dr (Mrs) Omobola Johnson, who led the Nigerian delegation to the international forum was unequivocal about the mission of the country, noting that “the target was to ensure that all discussions and meetings “materialise into mutually beneficial investments in Nigeria and that together we can build and deploy sustainable solutions for the huge market opportunity that Nigeria represents.”

At a Business meeting organised by the NCC for prospective investors at the forum, the Commission had dangled incentives before the investors with a  declaration that any company that is licensed to provide broadband infrastructure, otherwise known as Infrastructure Companies (Infracos) would among other incentives, get tax holidays of between five and seven years to cushion their investments portfolios. Making a presentation on behalf of the Commission, Principal Partner of KPMG, consultants to the NCC, Joseph Tegbe, told the audience that the investors will be encouraged to veer into areas where many consider to be less commercially rewarding through subsidy, and grants may be given out to further their interest in such areas. Tegbe said the InfraCos will also be granted pioneer status as part of the incentives to boost their interest in investing in such areas or zones that may look unattractive.

Furthermore, he said such InfraCos will get such incentives that could be up to 30 per cent mark up on their capital expenditure (CAPEX) and employee tax holidays as well. To qualify for these, InfraCos will quantify their CAPEX and what it will take to rollout and how long it will take to break even.

On its own, the Commission had noted that though over $32 billion had been invested in the telecom sector so far, yet there is still a yawning gap in broadband penetration which stands at only six per cent at the moment. 75 million people connect to the Internet on narrow band. It encouraged would be investors to take advantage of this gap because apart from government and high networth individuals who desire these services for high data transmission, the banks, education sector and electronic commerce operators need broadband to carry out their heavy data too.

The NCC has adopted the Open Access Model to promote healthy competition, affordability and global best practices in its regulatory activities.

Spectrum Auction for Broadband

As part of its action plans to ensure that all Nigerians enjoy access to broadband, the NCC has since the release of the National Broadband Plan in late 2013 swung into action by releasing new spectrum license for the delivery of broadband service. Mid 2014, the NCC concluded the auction of frequency in the 2.3GHz band for the delivery of broadband wireless access service at the wholesale level, to provide ISPs and other retail telecom services providers with requisite bandwidth to service subscribers.  In addition to this, the Commission is in the process of auctioning another frequency in the 2.6 MHz Band.

Besides, the Commission also said it has concluded arrangements to open and license high capacity frequency spectrum bands for backhaul and last mile services in the country as part of efforts to achieve the national broadband plan. This, it intends to achieve by Auctioning the available slots in the 2.3GHz, 6GHz and 700MHz band for wireless broadband access.

In addition to that, the telecoms regulator had also announced the availability of 5.4 GHz spectrum, across the 36 states of the federation, through advertisement and already receiving applications for it.

It is for the same purpose of deepening broadband penetration in the country that the NCC had to consider another frequency licensing in the 70/80GHz spectrum band. The Commission, which lamented that the 70/80 GHz spectrum band was yet to be fully explored and exploited in Nigeria, noted that every spectrum bands that is available globally are used diversely, which was why it recently held industry-wide consultative forum preparatory to the licensing of the 70/80 GHz spectrum band.

While seeking industry stakeholders’ input for the final draft towards the licensing, the Commission noted that beyond the usage and applications lie the critical part, which is how to share resources for the common good of the investor community, the service provider community and the consumer of services community. Shedding more light on the spectrum band and its licensing, the Director, Spectrum Administration and Control, Austin Nwaulune said the National Frequency Management Council (NFMC) had allocated 71-74 GHz/81-84 GHz spectrum bands to the commission, which by so doing makes available a total of 3GHz out of the available 5GHz bandwidth Frequency Division Duplex (FDD).

Nwaulune said the plan is to create opportunities; possibilities and good quality services, which will provide avenue for individuals and corporations to deliver broadband to customers at affordable price and very fast. According to him, the band can cover an average distance of 1.5 Km and spanning to four Km or more, stressing that the result of trial conducted by a vendor in Nigeria showed that the E-band business case is both technically and commercially feasible in Nigeria. He added that the country needed the band to among others, bridge the last mile gap between fibre backbone and commercial buildings not easily accessible by fibre; help redundant networks, among others. Some of the benefits of the spectrum, according to Nwaulune, include aiding socio-economic benefits through the enhancement of broadband service delivery; ease the pressure on the Microwave bands.

Licensing of InfraCos

In a clear demonstration of its understanding of the system and its challenges, the NCC is taking the bull by the horn in its efforts at addressing the broadband infrastructure challenge, which has been the bane of the country’s broadband pursuit. As part of strategies to enhance broadband penetration in the country, the NCC had perfected plans to license seven infrastructure companies to drive infrastructure building across the country, on which broadband services can be deployed by various operators on open access model basis.

Out of the seven InfraCos to be licensed, the Commission had early this year awarded two licenses to MainOne Cable Company and IHS Nigeria. While MainOne is to provide the required infrastructure services in Lagos State, IHS Nigeria Limited, according to the issued license, will be responsible for providing the services in the north-central zone of Nigeria (which includes the Federal Capital Territory, Abuja).

According to the Commission, plans are underway to license the remaining five others to be sited in all the geo-political zones of the country. The seven companies, when licensed, were expected to provide broadband infrastructure services in all parts of the country. The challenge has always been that of infrastructure. NCC is already addressing this, in the sense that seven infrastructure companies will be licensed to provide infrastructure, the NCC stated.

As the regulator, NCC is not only driving the broadband project through spectrum and license auctions alone, it has also pledged its unwavering support for existing services providers to be able to deliver affordable internet services to Nigerians. Accordingly, the commission would continue to support small and medium Internet Service Providers (ISPs) via the Interconnect of Internet Exchange Points (IXPs) across the country, drive affordability of transmission capacity via institution of a cost-based pricing model and price caps for leased transmission capacity and optimise capacity utilisation by instituting active infrastructure sharing.

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