Friday, June 25, 2010

ICT stakeholders resent delay in NCC, NBC merger

. . . Says it may dampen technology development
Ben Uzor Jr

The delay in the proposed merger of the Nigerian Communications Commission (NCC) and National Broadcasting Commission (NBC) has drawn the resentment of stakeholders in the Information Communication Technology (ICT) industry who maintain that existing technological trends demands such union and failure to accomplish this would not only suppress the impressive growth recorded in the telecommunications landscape but also reduce Nigeria’s chances of attaining its vision 20:20 target.

According to them, there was urgent need to restructure the current independent regulatory agencies (NCC, NBC, and NITDA) until an ICT industry emerges as the sector must recognise that convergence of technologies was challenging existing institutional set-up, breaking new content aggregation, delivery and consumption of communications services. To this end, they called on the Federal Government to speed up the merger process between the NCC and NBC so as to create a suitable regulatory ambiance that would encourage more foreign direct investment into the sector.

Moreover, the call for merger had generated so much controversy in the past and the argument at the time centered on who would regulate the converged technologies, NCC or NBC as well as the new name to be adopted for the emergent industry, Business Day learnt. Experts in telecoms industry wanted NCC to be the regulator of converged technologies. On the other hand, those in the broadcast industry disagreed, claiming that there would be conflict of interest in regulating converged technologies, and insisted that both NCC and NBC be left to regulate telecommunications and broadcasting respectively.

Emmanuel Ekuwem, chief executive officer, Teledom Group who spoke to Business Day, weekend said: “There is so much confusion in the industry as a result of the non-availability of a one stop regulatory shop. We require a unified regulatory institution that will ensure no duplication of effort, no struggling for part of the spectrum. Today, individuals and companies go through the back door to obtain spectrum so as to offer telecom services. If we do not have a good regulatory environment, a one stop shop for regulation, then the confusion we are having now will persist. This will hinder the growth of the telecom industry. It will also hamper the deployment of WiMAX because of inefficient spectrum allocation.”

The Federal Government had earlier set up a presidential committee to harmonise the industry based on stakeholders’ agreement that there was need to converge technology and its regulators. However, the committee’s recommendations on the merger were not adopted because at the time the Obasanjo administration was handing over the reins of power to a new administration. It was also gathered that a ministerial committee has been established to revisit the merger of NCC and NBC.

“We hope that when this present committee finishes its work we will have the needed political will to see it through. I think that when you recommend something like merge the regulatory bodies, that’s not something very easy to do. It is not just something you wake up and do over night. You have to have the political will to make it happen. We hope this time there would be the political will to really implement the recommendations of this committee. The committee by the way right now is asking for public input”, Raymond Akwule, president, Digital Bridge Institute (DBI) explained.

Besides, Titi Omo-Ettu, president, Association of Telecommunications Companies of Nigeria (ATCON) believes that government may have withdrawn from merging the two regulatory institutions because of insufficient understanding of the complexities inherent in convergence. But more importantly, he further noted that the implication of convergence has brought about the need to unify regulation.

“In the past, when government set up the committee to look at unifying regulation, it did not understand the implications of the request that we were making. We were making a request of promoting the need for convergence because technology has already converged. They thought what we were saying was just to merge the NBC and NCC. So they decided to set up a committee to look into it. It was when the report came out that they saw that this issue was more than just merging two agencies.

“I think that the government at that time said since we are on our way out, let us wait, any new government can implement it. This is because it entails a great deal of work. In a developing economy when you say you are merging two things, people starting seeing a husband and a wife and they start reading personalities in issues. It appears this dominated the discussion at the time. Unfortunately, government started withdrawing because they did not want trouble on their hands”, he added. In the same vein, Lanre Ajayi, president, Nigerian Internet Group (NIG) observed that technology had converged and the need for multiple agencies regulating the converged technologies should not arise.

“If technology is converging, it makes sense that the agencies regulating it should converge as well. The evidence of convergence is apparent in the technology devices we carry about today. The GSM phones, for instance, can do voice calls; browse internet on it, and as well watch television and DStv broadcast on it. What evidence do we need to show that technology has converged and why must we have separate agencies regulating technology that is already converging.

“The much talked about merger of the NCC and NBC has to be done. The good news is this; I don’t think the NBC is resisting the merger. I was privilege to be on the presidential committee for the restructuring of the ICT industry that recommended this merger and the NBC’s Director General was also there. I did not see that resistant as was expected. I think he agreed that there should be a merger.

Emerging submarine cable may drive down call rates

Ben Uzor Jr
Going by the increasing number of submarine cable systems on the Nigerian coastline, telecommunications subscribers in the country may soon pay less for international calls. Though Nigeria’s internet penetration is still in its lowest ebb, the much anticipated commencement of operations by Main One submarine cable next month would, indeed, crash the cost of internet access, bringing about the desirable digital revolution that the country has been yearning for.

Industry watchers say that the system would also contribute to an immediate 50 percent drop in the price of bandwidth in Nigeria and Ghana, and continued price reduction was anticipated over time. BusinessDay gathered that GSM operator, MTN Nigeria, is the largest single user of bandwidth in the country. As at today, the company’s bandwidth demand is put at 2 SPMs.

Also, other telecom operators, internet service providers (ISPs), and financial institutions use varying amount of the remaining bandwidth to provide services to the end users. Industry analysts say that SPM is expected to increase tremendously, when other cable initiatives such as the Glo 1 Cable, ACE Cable, and the West African Cable System (WACS) come on stream.

As it stands today, the Main One Cable appears set for business with the completion of the sea cable connectivity from Portugal across West Africa, and terminating in Lagos. The company announced that it will launch its high capacity fibre-optic cable system on July 1, in Ghana and Nigeria.

Moreover, the cable infrastructure will deliver 1.92Tbps of high capacity bandwidth - equivalent to ten times the available capacity of the existing fibre optic cable serving West Africa, and more than 20 times the satellite capacity currently available across sub-Saharan Africa. With this, the stranglehold that Nigeria has enjoyed in internet bandwidth will soon be over. But more importantly, it would usher in the necessary price correction in bandwidth cost, and increase reliability with the obvious redundancy.

According to them, the considerable increase in available bandwidth from the Main One Cable will provide telecommunications operators and financial institutions with the additional capacity they require to expand networks and mobilise a broader range of services.

BusinessDay gathered that Main One was on the verge of completing formalities that would herald the commencement of Phase 2 of the project, which will witness an extension of the cable to South Africa. In addition, it was learnt that the company has built an extensive terrestrial fibre-optic last mile network spanning 26km from the cable landing station in Oponbo, to a point of presence in Saka Tinubu, Lagos. This was strategically designed to ease access to customers and ensure high availability of service.

Funke Opeke, chief executive officer, Main One, who spoke to BusinessDay in an interview recently, observed that the actual submarine cable was installed, further adding that testing and commissioning had begun. “The cable would be ready for service by the end of the month. We have selected July 1, 2010 as our ready for service date”, she stated.

Commenting on what would give Main One cable competitive edge over other cables expected to hit the Nigerian shores, Opeke revealed: “We are open access which makes a lot of our operators’ customers feel comfortable. We provide services to all operators; we are not a retail operator, we only do business on a wholesale basis. So, we are not competing with them, it’s shared infrastructure. Our objective is to deliver superior value to them at a reduced cost in an open pricing scheme. You get a higher discount if you buy more volume or if you subscribe for a longer period. So, no operator is treated unfairly. They can truly focus on just acquiring the capacity and then concentrating on their business and service to the retail customers.’’

“So, we think that makes operators comfortable in working with us. Our focus is delivering them high value on our cable, and not focusing on other retail businesses or other sectors in which we are participating. We think the service focus, value focus, and open access model clearly differentiates us. The open access says we will not compete with operators, and our objective is to reduce our cost, increase the value so that they can be successful in their business”, she posited.

In the same vein, Jonny Coleman, head, network planning and implementation, Main One Cable Company, said: “We are working very closely with our customers as well on the last mile deployment. In Nigeria, we have built an extensive fibre-optic terrestrial last mile network, about 26 km from our cable landing station in Oponbo to a point of presence in Saka Tinubu, to ease access to customers. Infrastructure deployment costs are pretty high, so you can appreciate the level of investment we put into this network. It is supposed to be a redundant network. All these are in place and have been tested, with a target date of end of June and a commercial launch date of July 1.’’

Wednesday, June 9, 2010

Poor frequency management may slow telecom growth

. . . Telecom subscriber base hit 78.9 million mark
Ben Uzor Jr

There are growing concerns that Nigeria’s inability to effectively manage its national frequency resources which would include the timely sale of available frequencies to support rollout of new technologies and services may impede the country’s quest to sustain the impressive growth recorded in the telecommunications landscape beyond 2010, Business Day can now reveal. National frequency spectrum refers to the entire range of electromagnetic communication frequencies available to a particular country including those used for radio, radar and television.

Also growth in the telecom sector has remained unabated as latest statistics from the Nigerian Communications Commission (NCC) reveal that active connections peaked at over 78.9 million lines as at April this year with the GSM mobile sector accounting for the traditional market dominance with over 69.6 million lines. Furthermore, the mobile CDMA segment exceeded 7.7 million lines whilst the fixed wired/wireless segment accounted for 1.4 million lines within the period.

Earlier, the NCC had declared that it would focus on the appropriate management of the national frequency spectrum. It was gathered that the telecom regulator was urgently looking at feasible ways to provide new licenses for spectrum dependent services on 2.3GHz, 2.5GHz, 3.5GHz and 5.4GHz. As at today, the 2.5GHz spectrum remains ideal for WiMAX and LTE deployment but is still managed by the National Broadcast Corporation (NBC).

With the emergence of new technologies such as Long Term Evolution (LTE), Internet Protocol Television (IPTV), Voice over Internet Protocol (VoIP), industry watchers assert that part of the responsibility of the regulator would be to guarantee that there are frequencies earmarked for these new services. This, they said was because the allotment of such frequencies would assist the industry to potentially get ahead of many markets thus putting Nigeria on the front foot rather than playing catch-up.

But more importantly, the proper management of frequency spectrum would further compliment the investment in the deployment of submarine cable infrastructure and further improve penetration in the country, they noted. Lanre Ajayi, president, Nigerian Internet Group (NIG) who spoke to Business Day in a telephone interview stated that there was a need for proper management of national frequency resources if the nation intends to maintain the remarkable growth recorded in the telecoms sphere.

“It is indeed obvious because all the deployment we are doing now is based on wireless technology and wireless technology demands spectrum. Moreover, the broadband revolution which we are all anticipating would ride on wireless technology because fibre cannot reach everywhere.

He went on, “When MainOne, Glo-1 and other submarine cables become active, wireless technology will be needed to push the available bandwidth to the hinterland. This cannot be achieved if there is no spectrum allocated for this. If our national frequency spectrum is not managed efficiently then Nigeria will not be able to bridge its’ digital divide. This would mean that the average Nigerian will not have access to broadband internet services. So, proper spectrum management is very imperative in our case.”

In the same vein, Titi Omo-Ettu, president, Association of Telecommunications Companies of Nigeria (ATCON) said: “NCC is required to plan spectrum efficiently. I know that they are looking critically at spectrum management. Ignorance is one of the major impediments to proper spectrum management. We only hope that there would be a paradigm shift in frequency allocation as we move forward.”

On the contrary, some industry analysts have argued that one of the fundamental problems hindering proper management of national frequency resources was the absence of harmony amongst these government institutions, the NCC, the Nigerian Broadcasting Commission and the National Information Technology Development Agency, managing the resources. According to them, these institution were not converging and hence the need to restructure the current independent markets (telecom, broadcast, computing, IT) until an Information Communications Technology (ICT) industry emerges.

This, they said was because the sector needs to recognise that convergence of technologies was challenging existing institutional set-up, breaking new content aggregation, delivery and consumption of communications services. One analyst who spoke to BusinessDay on the basis of anonymity said: “Globally, technology is converging; telecom, broadcast, computing is coming under one roof. So too, the institution managing these technologies such as the NCC, NBC, and NITDA must converge. There is no harmony amongst them, the spectrum that should have been allocated properly to enable rollout of new technologies is held up by these institutions. These institutions must come together for us to see further growth in the ICT industry.”

MainOne staves off competition with ‘open access’ strategy

. . . Sets July 1 for commercial rollout
Ben Uzor Jr

As the number of submarine cable system increases on the Nigerian coastline, Main One Cable Company has revealed that its open access strategy which dictates that the cable will not be in direct competition with telecommunications operators but rather provide high value wholesale bandwidth at affordable costs would definitely be the distinguishing factor as competition thickens in the cable sub-sector.

However, the company has announced that it will launch its high capacity fibre-optic cable system on 1 July in Ghana and Nigeria. Last month, the firm completed the first phase of installation from Accra in Ghana to Lagos, Nigeria, and has begun testing network equipment. Phase 1 of the system spans 6,800km from Seixal in Portugal through the West African coast to Ghana and Nigeria and will deliver 1.93Tbps of much-needed international capacity into West Africa where rapid growth in telecoms has been blighted by limited global connectivity.

Business Day learnt gathered MainOne was on the verge of completing formalities that would herald the commencement of the Phase 2 of the project which will witness an extension of the cable to South Africa. Furthermore, it was learnt that the company has built an extensive terrestrial fibre-optic last mile network spanning 26km from the cable landing station in Oponbo to a point of presence in Saka Tinubu, Lagos. This was strategically designed to ease access to customers and ensure high availability of service.

Funke Opeke, chief executive officer, Main One who spoke to Business Day at the WAFICT conference and exhibition recently said: “We are open access which makes a lot of our operators’ customers feel comfortable. We provide services to all operators; we are not a retail operator, we only do business on a wholesale basis. So, we are not competing with them, its shared infrastructure. Our objective is to deliver superior value to them at a reduced cost in an open pricing scheme. You get a higher discount if you buy more volume or if you subscribe for a longer period. So, no operator is treated unfairly.

“They can truly focus on just acquiring the capacity and then concentrating on their business and service to the retail customers. So, we think that makes operators comfortable in working with us. Our focus is delivering them high value on our cable and not focusing on other retail businesses or other sectors in which we are participating. We think the service focus, value focus and open access model clearly differentiates us. The open access says we will not compete with operators and our objective is to reduce our cost, increase the value so that they can be successful their business”, she added.

In the same vein, Jonny Coleman, head, network planning and implementation, Main One Cable Company said: “We are working very closely with our customers as well on the last mile deployment. In Nigeria, we have built an extensive fibre-optic terrestrial last mile network about 26 km from our cable landing station in Oponbo to a point of presence in Saka Tinubu to ease access to customers. Infrastructure deployment costs are pretty high, so you can appreciate the level of investment we put in this network. It is supposed to be a redundant network. All this are in place and been tested with a target date of end of June and a commercial launch date of July 1.

Recently, Main One signed a deal with Huawei Nigeria to provide it with its Intelligence Optical Switching System (OptiX OSN 9500) to serve as the backbone platform to provide high transmission bandwidths in the region. Main One has also inked a maintenance contract with Alcatel-Lucent for Phase 1 of the system. The agreement will enable Main One to address the need for managing and maintaining the network at the highest level of performance delivered at the lowest operating cost.