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How watchdog plans new licensing to pipe broadband services

How watchdog plans new licensing to pipe broadband services
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The second phase of infrastructure companies (Infracos) licensing to offer metropolitan fibre infrastructure for broadband will soon begin, the Nigerian Communications Commission (NCC), has said.

The telecoms watchdog agency will be using the “Open Access Model” for a new broadband deployment environment in line with the National Broadband Plan, a government roadmap for the diffusion of high-speed Internet across the country.

The “Open Access Model” has been examined as the model for optic fibre transmission network deployment to bridge the current gap and deliver fast and reliable broadband services to households and businesses in Nigeria, according to NCC.

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The model for broadband deployment is expected to address challenges of congested and unplanned towns, infrastructure sharing and other issues such as high cost of Right of Way, NCC says.

The “Open Access Model” was developed after the first industry consultation held by NCC on July 26, 2012 with the theme “Demand as catalyst for broadband services in Nigeria”. The consultation was to engage the industry stakeholders on the future direction of the Next Generation Broadband Network (NBN) in Nigeria.

NATCOM must pay, Professor Umar Danbatta, Executive Vice Chairman at NCC, insists
Professor Umar Danbatta, Executive Vice Chairman of NCC

NCC later held one-on-one sessions with select operators/industry stakeholders between the July 15 – 22, 2013 on the strategic objectives for the deployment of nationwide optic fibre infrastructure for broadband, and seek their input on this initiative.

Under the plan, NCC believes that to achieve the Nigeria Vision 20:2020 economic transformation blueprint, it needed to accord priority to a long term widespread deployment of a robust nationwide comprehensive backbone and metropolitan fibre infrastructure.

The telecoms industry watchdog then highlighted the following principles for a national open access broadband network: Nationwide fibre penetration, Non-discriminatory and open access, Optimized Deployment Strategy and Co-operation of Existing Operators.[quote font=”georgia” font_size=”22″ font_style=”italic” align=”right” arrow=”yes”]Under the plan, Broadband InfraCos are businesses that will sell high capacity long distance transmission services to licensed fixed and mobile network operators, Internet service providers and other value added network service providers, which they can either use for expanding the reach and capacities of their own networks or resell to their customers.[/quote]

For the model to be used appropriately in bridging the current broadband gap and to achieve the objective of a nationwide broadband metropolitan and backbone deployment on an open access, non-discriminatory basis, the NCC has proposed new industry structure for the open access model for the country.

The main difference between the revised industry structure and the existing industry structure is the introduction of the InfraCos.

According to NCC, the rationale for the inclusion of InfraCos was to address existing market gaps in the metropolitan fibre segment. The introduction of InfraCos is expected to be complementary to the existing industry structure and help achieve the objectives of the Nigeria’s National Broadband Plan.

Under the plan, Broadband InfraCos are businesses that will sell high capacity long distance transmission services to licensed fixed and mobile network operators, Internet service providers and other value added network service providers, which they can either use for expanding the reach and capacities of their own networks or resell to their customers.

The InfraCos shall be an independent private entity, without government ownership. Any NCC licensee or other potential investor shall be able to invest in an InfraCo. Layer 3 access providers (RSP) may own shares but shall have no controlling interests in InfraCos to ensure structural separation, according to the telecoms agency.


Infographics of Internet subscribers in Nigeria
Infographics of Internet subscribers in Nigeria

InfraCo Mandate

According to NCC, the Infracos shall provide price-regulated, wholesale layer 2 metropolitan fibre access, within a licensed zone, on an open-access, non-discriminatory basis to access seekers. The InfraCo mandate shall exclude the last mile.

These services shall be end-to-end metro fibre within an InfraCo area and nationwide (by InfraCos arranging services from other InfraCos and intercity operators). InfraCos may also provide Layer 1 (dark fibre) metro transmission services within their assigned zones on a commercial basis.

NCC also says that InfraCos shall source long distance inter capital city transmission by lease or rental of capacity from existing operators to link and carry traffic from one licensed zone to other zones or states in Nigeria and to international submarine cables. InfraCos may also purchase existing fibre assets from long distance intercity operators.

Deployment Strategy

Each InfraCo shall cover one geo-political zone. There shall be a separate InfraCo for Lagos State under the planned licensing of a total of seven InfraCos proposed for Nigeria under the NCC plan.

The deployment/roll out of the services would be in phases across Nigeria. The first phase of deployment covers Lagos state and North-Central zone. The second phase of deployment, of which licensing is to commence soon shall cover the rest of the remaining five zones: North-West, North-East, South-East, South-South and South-West.

In order to achieve the objectives of the Broadband Plan, the core states that shall be chosen within each zone for the initial roll-out shall include the following characteristics:

  • States with a high population density.
  • States that are considered urban (High demand and market uptake).
  • States that have RoW charges that are regulated and agreed upon by the NCC and Federal Ministry of Communications Technology.
  • Location and accessibility of existing fibre.
  • Cost and complexity of provisioning new fibre.

In addition to the core states, the bidders in the Infraco licensing shall be required to identify and include other states to meet the targets for roll-out plan in their respective zones. Within each of the states, LGAs shall be selected to form part of the roll-out plan.

NCC says that in this phase 2 project, the Federal Government will provide financial support in the form of subsidy, which shall be completely determined to facilitate rollout obligations.

The Commission also says that the Request for Proposal (RFP) document detailing the commercial principles, key licensing conditions and technical specifications will soon be advertised and made available.

InfraCo Roll-out Targets for Phase 2

Year 2016 2017
Disbursement of government financial support % of capital cost % of capital cost
Total percentage of population in South-South zone 60% 70%
Total percentage of population in North-West zone 30% 40%
Total percentage of population in North-East zone 7.5% 10%
Total percentage of population in South-West zone 60% 76%
Total percentage of population in South-East zone 75% 90%
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Success Kafoi Journalist at Technology Times Media. Mobile: 08077671673 email: success.kafoi@technologytimes.ng

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