MTN, Etisalat to split voice, data service with new spectrum

MTN, Nigeria’s biggest telecommunications network, and Etisalat, the country’s fastest growing mobile operator are, in a strategic move, planning to seperate their voice and data businesses on the back of the proposed acquisition of 2.6GHz spectrum resource next year, industry insiders say.

This move, the insiders explained, would help improve network performance and efficiency as mobile operators look to meet rising customer expectations for better service delivery and generate more revenue.

Temi Ogunbambi, director, engineering, Etisalat Nigeria, confirmed this new direction in an interview, adding that the move explains why Nigeria’s telecomms industry is anticipating the auction of the 2.6GHz frequency spectrum band next year.

“Operators intend to utilise the existing 900/1800 MHz spectrum (2G and 3G) for voice services, while the 2.6GHz band, once allocated to derserving mobile operators, would be deployed specifically for broadband and data oriented services”,Ogunbambi said.

Market observers are of the view that there was a general lack of interest amongst GSM operators in the recently concluded 2.3GHz spectrum auction, midwifed by the regulator, the Nigerian Communications Commission (NCC). South Africa’s MTN, India’s Airtel, and UAEs’ Etisalat showed little interest in the two-day spectrum auction.

Twenty-seven companies sent in Expressions of Interests (EoI), but only Globacom and Bitflux Communications Limited actually applied for the 2.3GHz spectrum. Bitflux however, emerged winner of the auction, with a N3.8 billion bid to beat Globacom.

Market observers were however, of the view that, perhaps, the spectrum resource in question did not really suit the business model of most GSM networks. But this seems to have changed, as mobile operators are keen on this spectrum resource. “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 at MTN Nigeria.

Speaking with BusinessDay, Onajide said MTN is currently reviewing the Information Memorandum (IM) for the 2.6GHz auction published by the NCC, with a view to providing valuable insight that would enrich the auction process. For quite some time, mobile operators have been weighed down by the nation’s harsh operating environment, as well as pressure from the regulator to enhance Quality of Service (QoS) levels. “One of the biggest problems hindering better QoS is that operators deliver both voice and data services on the same network”, said Lanre Ajayi, president, Association of Telecommunications Companies of Nigeria (ATCON).

“Once the frequency spectrum is allocated to deserving operators, “they can now decongest their networks by moving data service to the new spectrum, which would help improve efficiency and performance”, said Ajayi, in an interview.

The NCC is working out modalities for the auction of the 2.6GHz frequency spectrum band, in an attempt to meet the Federal Government’s target of a five-fold increase in broadband internet penetration by 2018.

Speaking at a stakeholders forum in Lagos recently, Peter Igho, chairman, NCC, said, “we have 2 x 70 MHz Slot in the 2.6GHz spectrum band up for sale and we are determined to put it up for the most qualified organisation to utilise them for the benefit of the entire nation. “Our transparent disposition in the way in which this auction will be conducted is not negotiable.”

Ben Uzor