Over 15m Nigerians don’t make calls as market peaks at 60m

 By Shina Badaru

Lagos. May 10, 2008. The Nigerian Communications Commission (NCC) has finally granted a telecoms licence to Nigerian Communications Satellite Limited (NigComSat), the government-owned satellite services provider in a move that may see the feuding government agencies bury their hatchet following the row sparked off by the latter’s plan to provide ‘last mile’ services to subscribers.

Technology Times checks reveal that NigComSat, the government owned satellite service provider, which claims it could offer cheaper telephony at N10 a minute to bring down cost of telecoms services using its network to connect geographically dispersed locations nationwide was on March 1, this year granted an International Data Access (IDA) licence. The entry of NigComSat swells licensees in that category to eleven companies.

NigComSat and another company, Omnes Communications (Nigeria) Limited, a subsidiary of oil services company, Schlumberger, were both issued the 10-year licence dated March 1, 2008 and expiring February 28, 2018, according to information obtained by Technology Times from the regulator’s site.

Hitherto, other companies issued IDA licences include MTS First Wireless Limited, Accelon Nigeria Limited, Gilat Satcom Nigeria Limited, IwayAfrica Nigeria Limited, EM West Africa Limited, Information Connectivity Solutions Limited, Sub-Urban Telecoms Limited, Cobranet Limited and Interconnect Clearinghouse Nigeria Limited.

According to NCC, “The scope of IDA licence shall include the right to provide voice and data services and full interconnection to Public Switch Telephone Network (PSTN)”, seen by analysts as indications that NigComSat may soon realise its vision of providing last mile service.

In a related development, a growing trend that has seen the number of Nigerians that cannot afford to make calls on their phones have emerged with over 15 million inactive subscribers as connected lines in the overall telecoms market peaked at 60.9 million lines at the end of first quarter of the year.

Technology Times had exclusively reported that NigComSat’s application for a licence to offer service to subscribers was initially rejected by NCC, a development that pitted both organisations against each other while also sparking off a major media war.

NigComSat had sought a unified access service licence (UASL) that it reckons will enable it use capacity on its Nigcomsat-1 to provide telecoms services to end users. But the bid was to be greeted with mixed feelings by other telecoms operators while NCC rejected the application, a development that was later to witness the intervention of the Presidency and the National Assembly.

In the heat of the row, NCC had last year justified its stance that the government-owned satellite bandwidth provider will not be issued a licence to offer telecoms services in competition with the private sector.

Spokesman, NCC, Dave Imoko had said in a statement that the position of the NCC is that based on the existing laws and policy and “it is obvious that government clearly did not intend NigComSat to be a fixed or mobile telecommunications services provider that will be in competition with other such licensees.”

According to him, “the NCC is therefore clearly charged by the policy and the law to issue licences to all operators and service providers in Nigeria. This is why NITEL/M-TEL were licensed by the NCC and the two organizations also paid in full for their GSM frequencies and other licensees just like every other operator even when they were fully owned by government.”

He says that, “it is therefore in view of this clear understanding of both the provisions of the Policy and the Law that government did not consider it improper for the NCC to be represented on the Board of NigComSat. It is obvious that Government clearly did not intend NigComSat to be a fixed or mobile telecommunications services provider that will be in competition with other such licensees” adding that, “the Commission has a duty to ensure a level playing field for all operators in line with the Act and international best practices.”

Meanwhile, the telecoms market continues to grow but also carries the burden of over 15,041,632 inactive lines which in market parlance are numbers that have not made calls within the last 90 days and consequently hardly generate revenue for operators.

At the end of the first quarter, the GSM market accounted for the highest share of the active line pie with 43,786,542 lines while mobile CDMA operators’ share is 567,185 lines. Fixed wired/wireless players recorded 1,545,984 lines with total active lines now 45,899,711 within the period.

On the other hand, the connected lines for mobile GSM sector was 57,622,901 lines; mobile CDMA was 780,938 lines while fixed wired/wireless sector was 2,537,504 lines bringing overall connected lines to 60,941,343 lines within the period.

However, overall installed capacity in the telecoms market has grown to 88,471,789 lines at the end of the first quarter with the mobile GSM sector accounting for 79,625,308 lines; mobile CDMA, 3,170,000 lines and fixed wired/wireless recording 5,676,481 lines to bring the nation’s teledensity to 32.79.