Why Nigeria needs to develop fixed-line infrastructure

Ben Uzor Jr

Eugene Juwah, executive vice chairman of the Nigerian Communications Commission (NCC) says the country is suffering great losses in terms of untapped wealth, employment and value creation prospects, on account of the failure of telecom operators to deliver the broadband data and internet capacity available on the coast, to the hinterland via land-line networks. Juwah, who spoke with Business Day at the Mobile World Congress in Barcelona, said this failure had made nonsense of the number of submarine cable systems on the country’s coastline, which had significantly reduced the cost of wholesale bandwidth capacity.

Emphasising the losses accruing from the failure to deliver significant broadband internet services to the hinterland, Juwah observed that for every 10 percent increase in broadband delivery, a country would enjoy a 1 percent increase in Gross Domestic Product (GDP). “The majority of broadband we have now is through mobile networks. We have very little practical broadband on fixed networks. We cannot make appreciable progress in broadband without first of all treating our fixed-line broadband infrastructure. “Actually, the reason why mobile broadband in Nigeria is not working too well, is because there is no fixed broadband infrastructure. There is no in-land fibre to backhaul all this capacity back to their various switches.”

Juwah observed that operators were reluctant to invest heavily in fixed broadband infrastructure because voice services were still profitable. For this reason, he said the NCC has decided to create a broadband-focused infrastructure sector. According to him, “building good fixed broadband infrastructure will impact on the quality of service of operators because they can now backhaul their traffic, which is what they have been doing now using microwave. “Microwave is a thin route and very unreliable. The NCC is making a regulatory intervention into the provision of fixed broadband, so that an infrastructure sector is created which includes within itself, a sophisticated sharing of resources.

“This is not a question of an operator monopolising it and charging very high prices as is evident right now.” He said the NCC was prepared to put government funds in the infrastructure sector to ensure that the end-point prices come down, in order to ensure that internet access is available to the entirety of Nigerians at affordable cost. “My administration is really focused on developing broadband for employment creation. I am strongly looking at this issue from a policy and implementation standpoint. We are also looking at killer applications for broadband.”

Nigeria, according to analysts at the congress, missed a great opportunity due to the Nigerian Telecommunications Limited (NITEL’s) inability to massively deploy fixed lines when other development-focused nations of the world, such as the United States (US) and United Kingdom (UK) did. Whilst it is true that the mobile phone has attained high penetration and usage, for many homes, businesses and companies, according to analysts, there exist, a yawning need for basic fixed line access, with its numerous advantages. By year 2000, NITEL could only put in 400,000 connected telephone lines and 25,000 analogue mobile lines. The total teledensity stood at a paltry 0.4 lines per 100 inhabitants.

By the end of 2011, according to the NCC, Nigeria has attained over 90 million lines .The NCC is however conscious of the importance of fixed lines infrastructure in broadband deployment. This, according to analysts explains why the Juwah-led administration is looking to revive the segment by providing the enabling environment for private investors to expand the country’s broadband infrastructure. Statistics show that fixed-line telephone users make up less than 1 percent of the total subscriber base. Opportunity exists there, for growth in broadband communication as demand for data services grows.

First published on Business Day Media on Friday, 02 March 2012.

Etisalat plans to surpass Airtel in Nigeria

Ben Uzor Jr

Etisalat Nigeria says its strategic target for the new business year is to further narrow the gap between the firm and, Airtel, the third biggest operating company in Nigeria’s telecoms market. The telecoms company intends to reach over 15 million subscribers by the end of 2012, to achieve this feat. As at December 2011, official subscriber statistics from the Nigerian Communications Commission (NCC), nation’s telecoms regulator showed that MTN Nigeria had 41.6 million subscribers, while Globacom had 19.8 million; Airtel had 18.0 million and Etisalat Nigeria had 10.7 million, in the voice segment.

Steve Evans, chief executive officer, Etisalat Nigeria who made this revelation in an interview with Business Day at the recently concluded GSMA Mobile World Congress, said the telecoms company was well positioned to meet this target, pointing out that by the end of 2011, Etisalat Nigeria grew its subscriber numbers from 6.8 million to 10.8 million. “This year, we are targeting to take our subscriber base by the end of 2012 to over 15 million. We plan to add at least another four million net subscribers so that we would be well over 15 million. I think at that point, we are going to be quite close to been the number three telecoms operator in Nigeria’s competitive market. That’s our challenge for this year.

“We intend to grow our customer base while continuing obviously to grow the revenue per user at the same time. We have to be innovative. “We have to keep churning out interesting services to our customers and we have to ensure that the quality of network is of the highest standard”, he said. Analysts strongly believe the commencement of the Mobile Number Portability (MNP) scheme in October will be the game changer for Etisalat, a late entrant in Nigeria’s telecoms market. MNP scheme is expected to allow Nigeria’s over 90 million mobile telephone users to retain their numbers when changing from one mobile network operator to another.

“We need to promote mobile number portability because it is the only way that you create a more open market. Otherwise, the early entrants will have an advantage because they have mobile numbers which they gave to people 10 years ago and it is very difficult for people to change those number. If you look at measures which the regulator can take to enhance competition, number portability is very important”, Evans posited. In his reaction, Eugene Juwah, executive vice chairman (EVC), Nigerian Communications Commission (NCC) pointed out that MNP scheme was already on-going in the country.

“We have issued a license and we are expecting that come October number portability will be available in Nigeria. With this, if for instance an MTN customer is not satisfied with the quality of service they can switch to Etisalat and still retain their phone number. This is what Nigerians have been yearning for and it is my objective to make this scheme available to them by October”, Juwah said in an interview with Business Day recently. According to him, a combined registration of 110,433,976 SIM cards has been registered and the data is going through processing and cleaning at the moment.

Telcos, MNP firms begin consultation on service implementation

Ben Uzor Jr

Consultations have begun between Mobile Number Portability (MNP) firms and top-level management of telecommunications firms in Nigeria’s highly competitive market on technical and commercial issues critical to the successful implementation of the scheme, Business Day can reliably now inform. This is ahead of September date set by Nigerian Communications Commission (NCC) for the commencement of the scheme in the country’s telecoms sector. Beyond that, MNP will enable Nigeria’s 90 million mobile telephone users to retain their numbers when changing from one mobile network operator to another.

The contract for the establishment of the MNP Clearing House, which forms the pillar of the scheme, was awarded last October. A consortium of three firms had won the bid to operate. The firms that make up the consortium are Interconnect Clearing House Nigeria (ICN) Telecordia of the USA and Saab Grintek of South Africa. These operators, according to the telecoms regulator will make it easy for mobile network operators to comply with number portability mandates by creating a centralised system for porting all number types which would thus ensure a smooth and trouble-free process.

The NCC had earlier explained that these MNP firms would have only six months to build out requisite infrastructure to implement the scheme. In addition, an extra two months, according to the commission would be given to the MNP operators to carry out testing before rolling out the scheme in the country. However, Business Day also gathered that the scope of the ongoing consultations from a technical perspective revolves around how MNP firms can integrate with telecom provider’s Operations Support Systems (QSSs) and internal business processes, such as customer care, billing and order management.

It is critical that network element systems are integrated so the network can obtain the correct routing information for calls to ported numbers. “Fundamentally, telecoms operators and number portability providers will be discussing systems integration and interoperability of their systems. And of course, there will also negotiate on interconnect charges and network handshake. There will also be legal issues to discuss as it is critical to the success of the scheme. Discussions will also revolve around terms of billing, terms of porting, etc”, Gbenga Adebayo, chairman, of the Association of Licensed Telecommunications Operators of Nigeria (ALTON) told Business Day in a telephone interview.

“I am not aware of this development. But I believe telcos and MNP firms will have lengthy discussions on technical issues relating to interface of systems initially before commercial issues. “There certainly has to be an interface between telcos and MNP providers if the scheme is to be successful”, Lanre Ajayi, past president, Nigerian Internet Group (NIG) told Business Day in an interview. From a commercial perspective, Business Day further learnt that discussions will border on the service charges levied on a subscriber who is moving from one network to the other and the sharing arrangements of such charges.

Business Day also gathered MNP firms and telcos are also negotiating on commercial agreements relating to the ability of a subscriber to pay his bill generated from the last telco. This is in the case of post paid subscribers. Other pertinent issues are the time it takes to port which at some point will became a subject of focus by the both telcos and MNP providers. Prior to March 2008, it took a minimum of 5 working days to port a number in the UK compared to only 2 hours in the US, as low as 20 minutes in the Republic of Ireland, 3 minutes in Australia and even a matter of seconds in New Zealand.

Published on Business Day, Thursday 23 February 2012

Econet demands $3.1 billion damages from Bharti Airtel

Ben Uzor Jr, with agency reports

Econet is seeking at least $3.1 billion in damages from Bharti Airtel in a dispute over ownership of its subsidiary Airtel Nigeria, according to a law suit filed on Wednesday. The move follows a federal high court ruling on January 30 that Bharti Airtel's ownership of its subsidiary Airtel Nigeria is "null and void" because co-founder and 5 percent shareholder Econet was not consulted on the transfer. South Africa-based Econet Wireless is disputing the Indian company's ownership of one of its top Africa operations. In 2003 Econet Wireless Limited, attempted to resist a takeover bid by Vodacom of Econet Wireless Nigeria (EWN) in which it owned 5 percent.

The sale to Vodacom however went through but Vodacom pulled out after citing irregularities in the takeover process. Besides, EWN was renamed V-Mobile and eventually a 65 percent stake was sold to Celtel, a division of Zain in 2006. Econet disputed the sale arguing that its pre-emption rights had been breached. Econet pursued the matter in the Nigerian courts in a bid to overturn the sale. In 2010, Zain sold its African mobile operations including Nigeria to Bharti Airtel for $10.7 billion.

Again, Econet sought to overturn this sale. The court has ruled that all actions and resolutions taken by the firm since October 2003, at which EWL was entitled to be notified and to participate in, as a shareholder, but was prohibited, are null and void. Bharti said last month that its stake in its Nigerian unit was "completely safe" and that the world's fifth-biggest mobile phone carrier by subscribers had appealed against the verdict."The claim for damages and equitable compensation against the Applicant and some of the Respondents might be in excess of $3 Billion," the document filed to the court said.

"The above estimated damages might also be in addition to a claim for $100 Million received by the Applicant as fees for the management of VNL (Vee Networks Limited, a former name of Airtel) for a period of 6 years which sum should have accrued." Bharti Airtel inherited the legal case as part of a $9 billion acquisition of Zain's Africa operations in 2010, including 65 percent of Zain Nigeria. The basis of Econet's claim is that its 5 percent stake was unfairly cancelled when Zain took control, so any decision made since then without it, including the transfer to Bharti, is void.

The Nigerian court upheld that claim. Nigeria contributes about 9.5 percent to Bharti's consolidated operational profits, the company says. Econet disputed the buyout of Airtel's stake from Zain Nigeria in 2010 because its right of first refusal over the stake was denied, in a dispute that had been ongoing since 2003, when the same assets were first sold to Vee Networks.

Published on Business Day, Tuesday 23 February 2012

Nigeria obtains frequency spectrum allocation from ITU

Ben Uzor Jr

After years of intensely lobbying the International Telecommunications Union (ITU), Nigeria and indeed Africa has finally secured additional spectrum allocation at the just concluded World Radiocommunication Conference 2012 (WRC-12), Business Day can reliably inform. The African Team, led by Bashir Gwandu, executive commissioner, Nigerian Communications Commission (NCC) dedicated to pursuing the Allocation of Spectrum to IMT on the 700MHz band has vigorously pursued the Allocation of the 694-790MHz at the ITU in order to turn Africa’s broadband potential into reality.

The African delegates, according to analysts who spoke with Business Day yesterday, have every reason to celebrate the conclusions of the WRC-12 and should indeed be celebrated by the African Telecom Industry for coming home with something that was up till now akin to a dream. This development, according to the analysts would enable telecommunication operators in Nigeria and Africa roll out innovative and reasonably priced broadband services, and consequently bridge Africa’s digital divide.

Still on the achievements of the African team particularly Nigerian delegates, they have ensured that the Code Division Multiple Access (CDMA) services on the 850MHz band (Principally for Visafone, Multilinks, Prestel, Rural Telephony, and Intercellular) that had neither Primary nor Secondary Allocation from the ITU, now have, a formal Primary Allocation Status in the Radio Regulations which should have been done many years ago either before or after the CDMA operators were licensed. This new allocation in the 850MHz band, according to industry watchers can now enable Nigerian operators to demand for non-harmful-interference from services of other countries -a right which hitherto they never had.

Among many other proposals made by Nigerian team was an important International Mobile Telecommunications (IMT) related proposal and an accompanying resolution which was adopted by the African Group as common proposal; to consider additional spectrum allocations to the mobile service on a primary basis and identification of additional frequency bands for IMT and related regulatory provisions, to facilitate the development of terrestrial mobile broadband applications. The proposal was also favorably considered and it was accepted to be the Agenda Item 1.1 for the WRC-2015.

Only few weeks ago, the request for the spectrum allocation presented by Gwandu on behalf of African countries was met by stiff opposition mainly from Western and Eastern Europe within Region 1 of the ITU. The African team in partnership with Arab group remained resolute and focused on the target with commitment of ensuring the success of their drive. According to Gwandu, “Africa has come of age to be taken seriously at the WRC, it is simply not an option to go back home empty-handed. “Yes, we can understand that the Allocation Request is not explicitly on the Agenda of the Conference as others would like to see it. But the Agenda Item 1.17 and the Section 89 of the ITU constitution provide sufficient ground to table such a request.

“Most especially considering the poor state of broadband penetration in African Countries”. After several weeks of Adhoc Special Technical Committee work attended by Europe and RCC on the one hand as well as Africa and Arab group on the other, Chaired by Larry Olson of the FCC which culminated into long nights of technical justifications by the proponents, the conference has eventually found solution to accommodate African request while also allowing sometime for technical planning and for other partners in the Region to rise to the occasion by allocating the requested 694-790MHz to mobile services on co-primary basis and identification for IMT, but effective 2015. The later effective date should allow for re-planning/clearance of broadcast TV stations in the band to lower band, as well as, development of common-channeling plan for the whole region which should be followed by common-standard development, chip-set manufacture, and mass production of relevant handsets and Base stations. This technical work is in line with the strive to achieve intra- and inter-regional harmonization for the use of band 694-790/790-862 MHz in order to ensure both broadcasting and mobile services operate in a non‑interference environment.

Through delicate negotiations, CEPT and RCC agreed to support African request. However, despite Inter-regional agreement to support the allocation, a reservation statement was entered by a group of European countries comprising; the Federal Republic of Germany, Austria, Belgium, the Republic of Hungary, the Republic of Latvia, the Principality of Liechtenstein, the Republic of Lithuania, Luxembourg, Malta, the Slovak Republic, the Czech Republic and the Confederation of Switzerland, who stated that they have accepted the compromise on the use of the band 694-790 MHz with great reluctance and on an exceptional basis. They further stated that they have given weight to the fact that the compromise was made in the spirit of International Cooperation and only to satisfy the urgent Broadband demand of those countries which made the proposals. This reservation of some European countries clearly underlines the difficulty that African delegates have faced in the bid to promote Information Communication Technology (ICT) growth and driving home the consequent opportunities ICT sector presents, so as, to address economic challenges in the continent.

On the satellite issues, concerns were raised by African delegates on the possible misuse of Radio Regulations provisions that could result in a single spacecraft being used to bring into use frequency assignments for multiple satellite networks at multiple orbital locations within a short period of time (i.e. satellite hoping to protected filings for the so-called satellites on paper or paper-satellite), and thus, deprive other countries, especially newcomers from Africa, the chance to secure the un-occupied satellite orbital slot. The WRC-12 decided to provide further guidance through a text that was drafted by a team –including Gwandu stating that; a frequency assignment to a space station in the geostationary-satellite orbit shall be considered as having been brought into use when a space station in the geostationary-satellite orbit, with the capability of transmitting or receiving that frequency assignment, has been deployed and maintained at the notified orbital position for a continuous period of ninety days. If after launch, the satellite failed before attaining 90 days, then the 3 year suspension rule automatically applies.

Any frequency assignment (orbital slot) not brought into use within 7 years of filing at ITU-R shall be cancelled by Radio Regulation Board of the ITU. Wherever a satellite is moved from a satellite slot or de-orbited, within 6 months, the notifying administration shall, inform ITU-R of the date on which such use was suspended. For a satellite that failed, the date on which the recorded assignment is brought back into use (with a replacement satellite) shall be not later than three years from the date of suspension. In addition, whenever an administration brings into use frequency assignments at a given orbital location using an already in-orbit satellite, the ITU-R should request for information indicating all other previous orbital locations/frequency assignments brought into use with the same satellite.

First published on Business Day, 20 February, 2012.

Positioning Nigeria’s software industry for global competitiveness

The software arena has become an essential strategic resource for intellectual capital, investment opportunities and value creation in any given economy. With Nigeria pointlessly spending over N25 billion in the past decade on importation of foreign software solutions, repositioning the nation’s software industry is key, writes Ben Uzor

Undoubtedly, the global economy has moved from agricultural, industrial to post-industrialism where information asset is currently perceived as a key driver for economic development, competitiveness and business improvement. Interestingly, the range of ICT-related concerns facing policy makers has increased dramatically in recent years: communications infrastructure, procurement for government automation and electronic government (e-government) programs, intellectual property, government-sponsored research programs, incubators and technology parks, engineering education, foreign investment and, of course, the potential for export revenue.

However, it is usually in this last area that the potential for dramatic economic growth like India or Ireland, which initially brought software to the forefront as a separate issue within ICT. To this end, the software arena has indisputably become an essential strategic resource for intellectual capital, investment opportunities and value creation in any given economy. Software is a relatively low-investment, environmentally friendly, high-growth global industry – a good target growth industry for many countries. But it has also become the most critical and expensive element of the government and business systems that every nation must build for itself.

Currently, the software industry in the United States of America (USA) is considered the third largest business after automobile and electronics. Moreover, software exports has major share in India’s total exports. Available statistics from the United Nations Conference on Trade and Development (UNCTAD) reveal that as 2004/2005, both software and services revenue grew by 32 percent to $22 billion and $28.5 billion in 2005/2006. As Stanford Professor, Edward Feigenbaum put it while serving as chief scientist for the United States Air Force; “we now live in a “software-first world.” The growth of the global demand that makes software exports a growth industry is driven by the continued consumption of software by other countries and business enterprises.

Every software-exporting country has evolved a unique industry, shaped by its own resources and situation and by the particular global opportunities presented at the time. For example, Japan exports mostly software games; India exports primarily software services to large software development shops while Ireland exports software products (created by MNCs located in-country as well as by a growing number of indigenous companies. In addition, Israel mostly exports software technology which is subsequently productized by firms in the US and Europe. There is no gain saying that the global software industry has continued to evolve, as countries now look to develop their software exports face a different global situation. Furthermore, they are likely to evolve fundamentally different software industries. In the light of this, current shape and dynamics of the software industry should therefore inform ICT planning and policy, no matter the country’s stage of economic development.

Nigeria’s software market

The country’s software market is dominated by imported packages. While this do not mean that Nigerian firms are simply retail outlets for those packages, the imported packages form the base for further software services to be offered by these firms. In part, this servicing derives from contextual differences: the fact that software packages developed in and for industrialised country markets are not exactly applicable in developing countries without some adjustment. While other nations continue to earn significant revenue from software exports, Nigeria is still groping in the dark, making pointless expenditure of over N25 billion in the past decade on importation of foreign software solutions.

This figure however represent only companies that registered their technology transfer agreements with the National Office for Technology Acquisition and Promotion (NOTAP). Stakeholders in the Information Communication Technology (ICT) industry revealed that Nigeria’s dormant software industry could spring up to become the much anticipated alternative to crude oil with respect to wealth creation and revenue generation, if only the Federal Government can increase its level of participation by way of formulating effective policies, creating the enabling environment and providing appropriate infrastructures to aid software development.

They further blame the industry’s snail speed development majorly on government’s refusal to increase tariffs on imported software to discourage imports. According to them, the Federal Government should increase investment in the area of establishing more national IT parks and clusters with appropriate policies on infrastructure, human resources, incentives and business plan. Chris Uwaje, president, Institute of Software Practitioners of Nigeria (ISPON) projected that the country’s software technology, if well retooled and strategically positioned for global competitiveness could earn about $10 billion annually from foreign software exchange.

He further challenged the present administration to become proactive and create the needed enabling environment for local capacity. The key benefit of a vibrant software, he added was in producing more knowledgeable and better skilled human capital for nation building. “Software has become and will remain one of the fastest growing industries with power to enrich, and sustain national economies. With youth population of about 43.2 percent, Nigeria possesses an immense advantage and capacity to encourage the emerging knowledge information society and succeed best practices and quality standards are established as strategic imperatives to match global competitiveness,” Uwaje posited.

In the same vein, Jimson Olufuye, past president, Information Technology Association of Nigeria (ITAN) called for the need to lay emphasis on training to produce an army of highly skilled Information Technology (IT) professional in terms of tertiary and non-tertiary and non-tertiary IT training at various levels. According to Olufuye, “Software is a product of profound human capacity. We need to develop our human capacity and channel their mind set on software design and architecture on various technology platform. “As regards policy formulation, the IT policy has given priority to software development but it seems that the political will is absent to pull it through.

“In addition, we need to establish more IT parks with appropriate policies on infrastructure, human resources, incentives and business plan.” Moreover, issues such as the absence of software quality assurance, poor investment in software development, poor product standard, scalability, lack of proper documentation which creates a gap in business continuity because the knowledge resides in one person, have all dogged the growth and development of Nigeria’s software industry. To this end, Nigerian firms spend huge foreign exchange on importation, repatriation of royalties and all manner of fees to foreign companies that most local players represent in the country even where the local firms have developed expertise to earn and keep their earnings in the country.

Indigenous software developers

With regards to the state of the industry, indigenous software entrepreneurs opine that the industry is characterized by fragmented players with little or no governing structure. According to them, there are a lot of skilled programmers with minimal or no business acumen. But more importantly, the regulatory framework remains weak and offers minimal support and protection for intellectual property rights and privileges. They however observed that the nation’s educational system and curriculum continues to be a problem, not focusing on the right learning and skills. Commenting on the present state of country’s software industry, Wahab Sarumi, chief executive officer, Wadof Software Consulting urged the government to come up with policies that would ensure that locally-developed software are being used by organisations in Nigeria.

He added: “Indigenous software developers are an endangered species, abandoned by the government, neglected by its own people and bullied by the poachers from India, to whom Nigerian businesses rush to buy software applications to solve local business problems.” Giving a different view of the problems of Nigeria’s software industry, James Agada, managing director, ExpertEdge Limited noted that the problem with the country’s software industry was not a question of foreign software over local software solutions. The MD said “If you have better software, people will buy and they do not care where it is coming from. If you want to sell software, the buyer does not buy the software alone, he buys the software, buys capacity to support the software, buys your capacity to improve on the software, he buys what he assumes is your mastery of the domain the software is meant for because the software must be able to compete favourably with its competitors.”

Ray of hope

A joint committee of the private and public sector are currently working to develop a fit for purpose framework for the establishment of incubation centres across the country that will foster the development of software industry, Omobola Johnson, minister of communications technology has disclosed. This framework, according to the minister “will include minimum IT infrastructure requirements, the creation of a technology innovation venture capital fund, avenues for the commissioning of bespoke software by the business community, institutional support for incubates in the form of business services and a strong mentoring framework by successful business entrepreneurs and a transparent and credible process to select incubates. We are committed to the establishment of four IT Incubation centres by the end of the third quarter of this year.”

Interestingly, National Information Technology Development Agency (NITDA) one of our implementing agencies recently signed a Memorandum of Understanding (MoU) with the Cross Rivers state government to leverage the infrastructure of Tinapa Business and Leisure resort in Calabar to build a knowledge city/IT park. It is expected that one of our incubation centres will be located in Tinapa.

Software incubation centre

Indigenous software developers in Nigeria’s burgeoning Information Communication Technology (ICT) landscape will soon be able to tap into the multi-million dollar global applications development market as progressive steps are already underway. The federal government disclosed plans to establish four software incubation centres in the country by the end of the third quarter of 2012. Johnson made this disclosure in Lagos recently while declaring open a Youth Empowerment and ICT Foundation programme sponsored by Jim Ovia Foundation. Johnson disclosed that the federal government is to invest about N1 billion to establish an ICT Incubation Centre.
“About N750 million to N1 billion will be needed to establish the incubation centre. This plan will ensure that private sectors invest their money in this IT innovation fund, in order to fund our local software entrepreneurs. We are investing in them because this local entrepreneur may not have collaterals to pay up their loans,” she said. The foundation in partnership with technology giants, Google, Microsoft, IBM, QT recently trained 350 African youths in the area of software development.

Commenting on the rationale behind setting up the ICT foundation and training programme, Jim Ovia, chairman of the foundation said if Nigerian youths are fully equipped with the appropriate training and capacity building, they will not only create software applications to be reckoned with globally but also establish IT business that can thrive and make a significant difference in terms of wealth creation and revenue generation.

The theme of the conference was ‘Developing Nigeria’s Next Generation of ICT Entrepreneurs” and would hold for five days. “Look, Google has a market capitalisation of N200 billion. “Nigeria’s foreign reserves is only N30 billion. Apple at one time made a profit of $1 billion in a week. Technology brands like Microsoft, Google, and IBM are more recognizable than the national flags of some countries that have been in existence for centuries. “This is why we need to empower our youths in the area of ICT. These firms were founded by young men in their twenties at the time. This is why we targeting our youths. There is need for us to inspire, train and engage our youths in the area of technology. We can replicate these success stories”, he added.

Johnson further noted that the training programme was in line with the ministry objective of developing relevant and up-to-date software development skills – including solution architecting and testing. These software incubation centres, according to the ICT minister will go a long way in accelerating the development of a commercial software industry by ensuring that appropriate support and funding is available to software and other IT entrepreneurs. Alluding to the establishment of a professionally managed IT innovation venture capital fund that will have the initial seed capital provided by government with contributions from private sector, Johnson also disclosed that a joint committee of the private and public sector has been instituted to swiftly develop a fit for purpose framework for the establishment of incubation centres across the country.

The launch of this fund, according to her will coincide with the rollout of incubation centres in the 3 – 4 initial pilots across the country. “This framework will include minimum IT infrastructure requirements, the creation of a technology innovation venture capital fund, avenues for the commissioning of bespoke software by the business community, institutional support for incubates in the form of business services and a strong mentoring framework by successful business entrepreneurs and a transparent and credible process to select incubates,” she opined.

The minister maintained that the move will foster the development of software industry, bearing in mind that Nigeria has lost about N18.9bn in the last five years as capital flight from importation of foreign software, according to the National Office for Technology Acquisition and Promotion (NOTAP). According to her, the draft ICT policy makes a strong case for software development.

Way forward

With regards to industry collaboration and the role of government in the development of the industry, software developers had complained that government had at no time been supportive enough either through technology biased policies like tax-breaks, tariffs/levies concession, or providing the enabling infrastructure and environment for innovation to blossom. Software practitioners have also complained about the absence of funding bodies focused essentially on technology. According to them, venture capitalist shy away from funding startups, more so technology ideas that seems complicated. There is need for strong partnership and collaboration between government and the private sector. Business entrepreneurs, state governments, unilateral bodies and even like-minded groups of youths must adopt federal government’s framework and help to establish Information Technology (IT) incubation centres in parts of the country that meet the defined criteria.

Published on BusinessDay Media, Monday 13 February, 2012.

Nigeria moves to expand software industry

Ben Uzor Jr

Indigenous software developers in Nigeria’s burgeoning Information Communication Technology (ICT) landscape will soon be able to tap into the multi-million dollar global applications development market as progressive steps are already underway. The federal government has disclosed plans to establish four software incubation centres in the country by the end of the third quarter of 2012. Omobola Johnson, minister of communications technology made this disclosure in Lagos recently while declaring open a Youth Empowerment and ICT Foundation programme sponsored by Jim Ovia Foundation.

Johnson revealed that the federal government is to invest about N1 billion to establish an ICT Incubation Centre. “About N750 million to N1 billion will be needed to establish the incubation centre. “This plan will ensure that private sectors invest their money in this IT innovation fund, in order to fund our local software entrepreneurs. “We are investing in them because this local entrepreneur may not have collaterals to pay up their loans,” she said. The foundation in partnership with technology giants, Google, Microsoft, IBM, QT last week trained 350 African youths in the area of software development.

Commenting on the rationale behind setting up the ICT foundation and training programme, Jim Ovia, chairman of the foundation said if Nigerian youths are fully equipped with the appropriate training and capacity building, they will not only create software applications to be reckoned with globally but also establish IT business that can thrive and make a significant difference in terms of wealth creation and revenue generation. The theme of the conference was ‘Developing Nigeria’s Next Generation of ICT Entrepreneurs’’ and would hold for five days. “Look, Google has a market capitalisation of N200 billion.

“Nigeria’s foreign reserves is only N30 billion. Apple at one time made a profit of $1 billion in a week. Technology brands like Microsoft, Google, and IBM are more recognizable than the national flags of some countries that have been in existence for centuries. This is why we need to empower our youths in the area of ICT. These firms were founded by young men in their twenties at the time. This is why we targeting our youths. “There is need for us to inspire, train and engage our youths in the area of technology. We can replicate these success stories”, he added.

Johnson further noted that the training programme was in line with the ministry objective of developing relevant and up-to-date software development skills – including solution architecting and testing. These software incubation centres, according to the ICT minister will go along way in accelerating the development of a commercial software industry by ensuring that appropriate support and funding is available to software and other IT entrepreneurs.

Alluding to the establishment of a professionally managed IT innovation venture capital fund that will have the initial seed capital provided by government with contributions from private sector, Johnson also disclosed that a joint committee of the private and public sector has been instituted to swiftly develop a fit for purpose framework for the establishment of incubation centres across the country.

The launch of this fund, according to her will coincide with the rollout of incubation centres in the 3 – 4 initial pilots across the country. “This framework will include minimum IT infrastructure requirements, the creation of a technology innovation venture capital fund, avenues for the commissioning of bespoke software by the business community, institutional support for incubates in the form of business services and a strong mentoring framework by successful business entrepreneurs and a transparent and credible process to select incubates”, she added.
She said the move will foster the development of software industry, bearing in mind that Nigeria has lost about N18.9bn in the last five years as capital flight from importation of foreign software, according to the National Office for Technology Acquisition and Promotion (NOTAP). According to her, the draft ICT policy makes a strong case for software development.

With regards to industry collaboration and the role of government in the development of the industry, according to her, software developers had complained that government had at no time been supportive enough either through technology biased policies like tax-breaks, tariffs/levies concession, or providing the enabling infrastructure and environment for innovation to blossom. Software practitioners have also complained about the absence of funding bodies focused essentially on technology. According to them, venture capitalist shy away from funding start-ups, more so technology ideas that seems complicated.

“We in the Ministry understand these issues well and there is clarity about the role that government can and should play. Let me mention briefly what the Ministry is doing to ensure that we build a software industry. As I mention these initiatives it is important that I state categorically that everything is being done in strong partnership and collaboration with the private sector and industry stakeholders. We hope that business entrepreneurs, state governments, unilateral bodies and even like minded groups of youths will adopt this framework and help to establish Information Technology (IT) incubation centres in parts of the country that meet the defined criteria”, she posited.

Published on Business Day, Tuesday 07 February 2012