• Friday, March 01, 2024
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Mafab: Timeline of a telco with dormant 5G licence

Mafab: Timeline of a telco with dormant 5G licence

As the curtain was closing in 2023, Nigeria’s long-awaited third 5G operator, Mafab Communications Limited, sent out a post on its X handle inviting users to shop its 5G routers on its website.

As of December 31, the company’s website has been updated with products and the prices of the products. While users would not be able to purchase data bundles on the website, the routers which are listed for N50,000 have a clickable button that leads through payment of payment into a Sterling Bank-owned Mafab Communications Limited. One of the four messages the company posted between 25 to 27 December on its X and LinkedIn handles is inviting users to “shop” the routers using a link in its bio.

Mafab Communication, which was very much unknown ten months before the December 2021 auction, shocked the telecommunication industry when it outbid the second largest operator and a publicly listed company, Airtel Nigeria, to secure one of the 5G licences, the Nigerian Communications Commission (NCC) was auctioning.

The company with no telecom footprint got a pass to participate because, according to the NCC’s Draft Information Memorandum (IM), new entrants were to participate in the bid. If they were successful, the commission would issue the new entrant an operating licence in line with the extant provision of the Nigerian Communications Act 2003 and its licencing regulations.

But two years later, Mafab Communications has taken a slow march to launch its service in the market. Apart from in February when Mafab Communications organised a launch ceremony during which it said it was now operating in Abuja and Lagos but never demonstrated or sold any product or service to anyone, the company has mostly kept its activity close to its chest.

The other time Mafab’s launch matter was in the media was when the NCC attempted to convince people that the company had launched. The first time the NCC did it was two days after the auction, on December 15, 2021, the commission denied that it had any knowledge that former Lagos State Governor and current Nigerian President, Bola Ahmed Tinubu was one of those bank-rolling Mafab.

The second time the NCC ran to defend Mafab was on 2 August 2023, when in an attempt to dispel reports that Mafab hadn’t launched its services, said with certainty that the company had launched 5G services. However, BusinessDay found that Mafab had yet to sell any product or service in any part of the country as of the time the NCC was defending Mafab.

In many countries, when telecom licences are not used after it was issued over some time, the regulator can request for it to be returned and it would be re-issued to another operator. The timelines for returning the licence vary. In the US it can be as much as 10 years. For example, the US Federal Communications Commission (FCC) in 2020 approved the return of an unused 700MHz licence vacated by an operator Choice Phone. The licence was originally granted to Choice Phone in June 2008 and terminated in February 2019 due to the company’s failure to fulfil FCC rollout requirements.

In Nigeria, Alheri Engineering had a similar story as Mafab Communications. Aliko Dangote’s relatively unknown company emerged as one of the four winners of the 2GHz and 450MHz bands auction in 2007. The commission had set the reserve price at $150 million for each of the four paired blocks 10MHz.

While MTN Nigeria, Celtel Nigeria, and Globacom went on to pay and deploy their 3G licence, Alheri Engineering never did citing difficulties with securing a GSM licence. The company had attempted to buy the defunct Nigeria Telecommunication Limited (NITEL) to pave the way for its GSM business. After several attempts to sell off the government-owned telecom operator, NATCOM, a consortium of seven Nigerian companies emerged as the new owners of NITEL and MTEL by offering to pay $252 million, an amount said to have met the bid price set by the Bureau of Public Enterprise (BPE). NATCOM onboarded the assets into its company ntel. MTN Nigeria has since leased the assets of ntel across the country.

Alheri will sell its licence to Etisalat two years later for the sum of $250 million which is a significant difference from the $150 million it bought the 3G licence from NCC and a guarantee of profit from the transaction.

BusinessDay reached out to NCC for feedback on the status of Mafab’s operations and has yet to receive any response from the commission until the time of publishing this article. A representative of the company however told BusinessDay that users can now purchase the router on the website. It is however important to note that the company’s leadership team were conspicuously missing on the updated website.