Govt eyes 1961 statutes to revoke dormant licences nationwide

 

By TECHNOLOGY TIMES Staff Writers

Lagos. June 10, 2013: The Federal Government is looking into the provisions of the Wireless & Telegraphy Act (WTA) that came into force in 1961 among several other statutes that may be invoked to reclaim scores of dormant frequency spectrum licences across the country.

Technology Times checks reveal that government may be considering invoking provisions of WTA stipulating that companies issued licences that also allot them scarce frequency spectrum to provide communications services in the country must use them within one year or risk losing them.

If the use-it-or-lose-it drive gets underway, scores of licences will be affected and may see several companies that have paid several billion of naira in licence and spectrum fees having to forfeit their slots over alleged non-compliance with licensing provisions.

Plans are in top gear by the Nigerian Communications Commission (NCC) to sell off several frequency spectrums under a process expected to kick off soon and into 2015 when Digital Dividends Spectrum expected to be vacated by broadcasting companies.

The move is in compliance with recommendations of the International Telecommunications Union (ITU), the U.N. specialised agency that coordinates the global telecoms industry urging nations to switch from analogue to digital broadcasting by 2015. 

 

Nigeria has already set up a team to ensure the nation meets the deadline for Digital migration involving the conversion of TV broadcast signals from the current analogue format to digital technology by January 1, 2015 as stipulated by the ITU.

The migration that will then free up the so-called Digital Dividends spectrum which has been vacated by broadcast companies and they are expected to be reissued to the telecoms companies to offer broadband services and promote the diffusion of high speed Internet connection across the country.

In a similar vein, the National Broadband Plan 2013-2018 recently submitted to President Goodluck Jonathan has recommending buy-back or pay-off of incumbent spectrum holders as some of the techniques that may be adopted for the needed “serious re-farming” of key frequency spectrum needed to drive the current administration’s broadband development goals.

Apart from the WTA, the telecoms regulator is looking into the provisions of its main legislation, the NCC Act; several subsidiary legislations within its Regulations and above all the strict provisions on mandatory service rollout conditions attached to licences that have been issued to companies that may be affected in the looming licence reclamation exercise, Technology Times learnt.

 

According to people very conversant with the situation, who spoke anonymously to Technology Times at the weekend, the government expects to free up several dormant frequency spectrum of new investors exploring stakes in broadband service to deliver high-speed Internet services across the country.

Hitherto, efforts by the telecoms regulatory authority to revoke some assigned frequency has been met with stiff resistance as some of the affected companies have mounted pressure in top government circle to stall the planned withdrawal of their licences by NCC.

Frequency spectrum speculation is big business for companies that have often bought assigned licences in the hope of reselling them at highly profitable prices to companies intending to use them for actual service rollout.

One of the key beneficiaries of such ventures is Aliko Dangote, Chairman of Dangote Group, who using his subsidiary Alheri Engineering purchased a $150 million in the 3G licence auction under which NCC sold four licence slots. The other three were sold at the same price to Globacom, MTN Nigeria and Airtel Nigeria.

Dangote was later to sell off the 3G licence to Etisalat Nigeria at a price which both companies did not disclose in a deal estimated within industry circles to have been closed at $265 million.

Etisalat Nigeria also paid a top fee of $400million to acquire licence for the provision of the fifth GSM network in Nigeria when promoters of the business, Emerging Markets Telecommunication Services Ltd, led by Hakeem Belo-Osagie, the former Chairman of UBA, bought the Unified Access Service Licence (UASL) bundling a mobile licence and spectrum in the GSM 1800 and 900 MHz bands from NCC in March 2007. 

 

The ambitious venture proved to be a major comeback bid for Belo-Osagie, who opted out of the landmark 2001 auction of Digital Mobile licences on grounds that they were overpriced at $285million apiece at the time.

In recent times, some of the network operators also cite frequency spectrum impediments as standing in the way of the commercial launches after successful technology migration to Long Term Evolution (LTE), a technology supporting faster speed for triple play services like voice, data and video.

Under the current dispensation, several telecoms frequency spectrum are now lying fallow and may hang in a delicate balance if the telecoms regulator makes good its threat to reclaim the scarce national resource, industry insiders said.

NCC is believed to find a key provision of its mandate under the Frequency Management Policy that empowers the regulator to “achieve optimum pricing of spectrum in order to discourage wastage or speculative acquisition of the scarce resource.”

Hitherto, the Wireless & Telegraphy Act (WTA) had provided the basis for management of Nigeria’s scarce frequency spectrum resources by the Ministers of Communications in the now defunct Ministry of Communications prior to the creation of the Ministry of Communication Technology.

The WTA largely covers spectrum used by telecoms companies that are regulated by the NCC and broadcasting spectrum assigned to broadcasting companies that come under the regulatory purview of the National Broadcasting Commission (NBC). 

 

Under the previous dispensation, the enactment of the NCC Act of 2003 and continued operation of WTA was believed to have created two separate agencies, the Ministry of Communications and NCC that possess near concurrent capacity for managing and regulating the telecoms industry in Nigeria.

It is a gap that legal experts reckon has created both legal and regulatory hurdles and oftentimes frictions between the two agencies of government.

Subsequent modifications of WTA have vested all the ministerial powers in the Act on NCC and NCC now has the legal capacity to manage, plan and regulate Nigeria’s frequency spectrum space, according to legal opinion on the matter.

Experts reckon that the NCC Act of 2003 which was signed into law under the administration of ex-President Olusegun Obasanjo on July 8, 2003 after being passed by both Houses of the National Assembly has helped to strengthen the capacity of the telecoms regulator assert its regulatory power.

The Broadband Plan which was submitted to President Goodluck Jonathan recently by the Presidential Broadband Committee also identified that 40 MHz is presently available on the 2.3 GHz frequency spectrum.

The Plan noted that, “the spectrum has been assigned to three licensees with 20 MHz each with serious interference from adjacent mutual transmissions as there are no guard bands. These may need to be re-planned to 30 MHz each for efficiency and high traffic capacity, and with additional 10 MHz spread across the band as guard band to provide protection for inter-operations and adjacent bands.”

Others cited in the Plan recommending spectrum aggregation across the whole band include:

• 694 – 790 MHz is under study by ITU till 2015.

• 790 – 862 MHz is planned for LTE but currently encumbered until 2015 due to existing assignment and allocations.  Serious re-farming techniques might be required and consideration for buy-back or pay-off of incumbents might be an option.

 • 2.5 – 2.6 GHz band: Currently occupied by Cable TV operators. These cable operators can vacate such spectrum to enable clean and fresh planning.

 • 1427.9 – 1452.9 MHz/1475.9 – 1500.9 MHz: not yet explored. Studies for maturity and viability should be conducted.