Federal Government’s decision to postpone the proposed 2.6GHz frequency spectrum auction earlier planned for December to a much more suitable date, is frustrating the business plans of prospective investors seeking to play critical roles in Nigeria’s emerging broadband market, market observers have said.
The Nigerian Communications Commission (NCC), on behalf of the Federal Government placed an advertorial in some national dailies, on Wednesday, to announce the postponement of proposed spectrum auction. This development, according to market observers, is not sitting well with prospective investors and mobile operators, who will however have to rejig their respective business plans and projections to meet current realities.
“The postponement of the 2.6GHz frequency spectrum is not positive for prospective investors. A lot of potential investors have built their respective business plans around the time-lines drawn out by the telecoms regulator,” said Lanre Ajayi, national president of Association of Telecommunications Companies of Nigeria (ATCON).
“But there must be a cogent reason for the postponement. In my view, it is better to have delays and get things right than to go ahead with the auction and mess things up,” said Ajayi, in an interview with BusinessDay.
The big players in Nigeria’s telecommunications market – South Africa’s MTN, national carrier Globacom, India’s Bharti Airtel and United Arab Emirates (UAEs) Etisalat Nigeria – all have eyes fixed on future mobile frequency spectrum licensing as they look to push affordable broadband services to rural communities in consonance with the National Broadband Plan (NBP).
“MTN welcomes the possibilities that additional spectrum that will enable the industry deliver broadband ideals to Nigerians is being made available by the NCC,” said Funmi Onajide, general manager, corporate affairs, MTN, in a recent interview with BusinessDay.
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Explaining why the frequency auction was postponed, Eugene Juwah, executive vice chairman, Nigerian Communications Commission (NCC) said, in the advertorial, “it is to enable the conclusion of all administrative requirements aimed at ensuring that the Frequency Licenses are delivered to winners and be effective immediately on conclusion of the Auction.
“By this announcement the current timetable is suspended. A new program including timetable will be published in due course,” according to the statement. The NCC helmsman further added that the commission regretted any inconveniences caused by the suspension.
Sources close to the commission said that the telecoms regulator may have decided to postpone the auction because the frequency spectrum in question, has not been vacated by the broadcast industry. The International Telecommunications Union (ITU) had set June 2015 as deadline for digital migration globally.
Expectations were that migration to digital broadcasting would free-up the 2.6 GHz frequency spectrum for mobile operators to deploy efficient broadband services across Nigeria.
According to them, there are huge uncertainties trailing the country’s digital migration process, as a series of bottlenecks, including paucity of funds, regulation, unrealistic timelines, and low awareness amongst the populace, seem set to frustrate the initiative.
Ben Uzor
