The positive impact of NCC regulation on ICT development

By Fred Agbata

In my candid opinion, I regard the telecommunications industry as the goose that has indeed laid the golden egg that is now a rapidly expanding digital economy and this is why I believe the entire industry (operators, consumers, policy makers and the regulator) have to continuously work together to ensure the industry continues to grow. I admit that a lot more needs to be done but I must state that despite the current economic crisis hitting hard, an introspective analysis of the telecoms industry is ideal at this stage.

The industry has recorded tremendous successes since the telecoms revolution started in Nigeria in the early 2000s. The journey has since recorded several challenges, ups and downs, disruptions as well as enhancements due to the ever changing technologies fuelled by dynamic innovations. Looking back to the earlier days, one recalls how expensive it was for an individual to purchase a mobile phone or even buy a SIM card which is almost free now.

Today, the case is different. The industry is now full of both challenges and new opportunities with room for improvement. Undoubtedly, at the forefront of the success of the telecoms industry in Nigeria is the Nigerian Communications Commission (NCC), which has regulated the industry with the much needed experience for the achievement of the glittering success of the industry.

A few weeks ago, the executive chairman of the NCC, Prof. Umar Danbatta, was questioned in Barcelona, Spain, on how the industry has fared in Nigeria. He responded, “Nigeria’s telecom industry has been successful because of the country’s regulatory excellence.” Quite frankly, I believe the NCC has done a good job worthy of emulation but there is indeed room for improvement as there are still lots of ground to cover.

Historically, the telecom industry in Nigeria started from its infancy in 2001 with a paltry investment of $500m. As at then, (2001), we had 400,000 connected lines. I remember back then, my father instructed me to go apply for a NITEL landline. I did and we were told to wait for our turn and that turn never came many years after. Today, all that is different, Nigeria now has about 155 million connected lines, recording a tele-density of 111 per cent.

Economically, the telecom industry is currently valued at $68bn, with $35bn coming from Foreign Direct Investments contributing 9.8 per cent to the Nigeria’s Gross Domestic Product.

Another aspect of growth that must be highlighted remains the depth of internet penetration in the country. The number of Nigerians that have access to the internet has increased exponentially.

At the moment, the number of active subscribers for data services on each of the licensed service providers utilising the different technologies is 91 million subscribers. Out of this figure, Etisalat has 14 million subscribers, Airtel 19 million subscribers, Globacom 27 million subscribers, while MTN has 31 million subscribers.

More importantly, another significant area that constitutes part of the industry’s success is the insistence on and ensuring that the service providers provide good service delivery to the users through effective regulation by the NCC. This is one of the major areas where the NCC has focused more lately.

This has drastically reduced the huge annual financial loses witnessed by Nigerian subscribers due to poor quality of service stemming from overstretched network capacity. This would have been worse if not for the proactive and reactive measures by the NCC. Obviously, the NCC has devised various measures for improving the quality of service, consumer satisfaction, thus, making telecom subscribers get value for their money.

In January 2014, the NCC imposed fines totalling N647.5m on Airtel, Globacom and MTN Nigeria for failing to meet the Key Performance Indicators required for quality of service.

One of the letters sent to telecom operators was certainly a clear indication that the commission meant business and determined to ensure that the needful was done in terms of quality service delivery.

The letter reads in part: “If the Quality of Service does not improve by 31st December, 2013, the commission will be compelled to direct operators to, among others, suspend the activation of new SIMs and subscribers until such an operator can prove that it has met the Key Performance Indicators specified in the Regulations.”

As if that was not enough, the commission recently came up with an initiative tagged, the “Year of the Nigerian Telecom Consumer campaign.” This initiative is a laudable one in my opinion. It is part of an all-embracing plan to continually protect Nigerians from being exploited by service providers who are employing all sorts of tactics to stay in business. For example, customers have complained about being auto-subscribed to various value added services without their consent.

These are a few of the very many things the NCC has done in catapulting the telecom industry to a higher realm, in collaboration with other key stakeholders in the industry. We are not yet there, but we have advanced on many fronts. However, I must state clearly that the commission should step up its rapid implementation of the Nigerian Broadband Plan, a plan that seems to have gone into the cooler. Yes, we have made progress with mobile internet growth but score rather low in broadband penetration which must be seen as a national challenge.

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