Poor economy may hinder 30% broadband target

broadband

Nigeria’s hope of attaining 30 per cent broadband penetration by the end of this year is under threat.

Based on the timeline of the National Broadband Plan (NBP) 2013-2018, 3G connectivity is supposed to have spread to not less than 80 per cent of the population by the end of 2018.

Also, virtually all the tertiary institutions, hospitals, government parastatals should have been wired.

But as at May, the Nigerian Communications Commission (NCC) said about 33 million Nigerians were still without access to telecommunication service.

The country’s broadband penetration is stagnant at 22 per cent, a figure attained as at the last quarter of 2017.

Six months into the New Year, there has been no major achievement on penetration in the country even at a time the United Kingdom government claimed that 95 per cent of premises within the country now have access to superfast broadband.

Investigations by The Guardian showed that there have not been any major investments in the telecoms sector since the beginning of the year, owing to economic uncertainty.

Lack of investors and investments also delayed completion of the sale of 9Mobile.

Its new management was given six months (which ended December 2017) to find a new investor for the embattled firm.

Teleology Holdings, which eventually emerged as preferred bidder earlier this year, is still looking for about $300 million and risks losing the opportunity if it fails to make payment in a few weeks.

The NCC has, however, announced the establishment of a broadband implementation committee to fast-track the deployment of infrastructure and raise broadband penetration in the country.

Prof. Umar Danbatta, NCC’s Executive Vice Chairman, disclosed this yesterday at the commission’s stakeholders’ engagement meeting with relevant state agencies in charge of telecommunications matters.

Danbatta said the committee would ensure targeted deployment of infrastructure needed to raise broadband penetration to 30 per cent before the end of 2018.

He said: “The licence has gone out to the infrastructure companies (INFRACOs), and we have a total of six of them in all zones of the country.

And each zone has an infrastructure company licensed by NCC to deploy infrastructure in that zone, and no licensee is allowed to deploy infrastructure in any other zone because it will develop issues.

“On top of all these efforts, there is a subsidy NCC intends to pay. This will be paid to INFRACO licensees for attainment of the milestone.

The monitoring committee will confirm the milestone, verify that it has been attained, and this subsidy will be paid.”

Confirming that the challenge posed by the economy is real, the president of the Association of Licensed Telecoms Operators of Nigeria (ALTON), Gbenga Adebayo, told The Guardian: “Not many investors are able and willing to invest in Nigeria at this time, going by the current social and economic situation and the issue of recession.

Foreign Direct Investment (FDIs) into the sector has been slow, since the beginning of the year.

Our view is that anybody who is willing to invest in this economy should be encouraged and protected.”

The Lagos Chamber of Commerce and Industry (LCCI) also claimed that the economy remains fragile, going by recurring challenges that continue to create concerns about prospects for sustainable poverty reduction and economic growth.

LCCI president, Babatunde Ruwase, said though the nation’s real GDP grew by 1.92 per cent in Q4 2017, few sectors are currently contributing to the positive GDP numbers, necessitating the need to grow other sectors.

On his part, the president, Association of Telecommunications Companies of Nigeria (ATCON), Olusola Teniola, disclosed that capital expenditure intended to continue the growth of the industry has stalled.

He said until the forex mechanism was corrected to remove multiple forex windows, it would be very hard for investors in the telecoms sector to bring in much-needed equipment to fund network expansion.

“We are talking about capacity issues; capacity cannot be increased unless we increase the equipment installed and provisioned, and usually it is in form of hardware and software.

If there is a mechanism by which we can actually access funds in dollars to purchase equipment, then we won’t have a delay in the expansion of capacity,” he said.

In an interview with The Guardian, the Chief Executive Officer of MainOne Cables, Funke Opeke, said the economic recession in the last two years slowed the country down greatly.

“The process appeared to have slowed down a bit in the country.

Some people even said we have reached an impasse, but I think it is time to get it done as fast as we can. We can’t afford to be left behind,” she said.

Kehinde Aluko, a telecoms expert, noted: “No investment can come to any country when there is huge uncertainty over return on investment.”

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