Nigeria grants licences to nine VAS Aggregators

The Nigerian government has granted licences to nine companies to offer Value Added Services Aggregator services in the telecoms market.

The VAS Aggregator licensees include 21st Century Technologies Limited, i-Cell Media Limited, Nine Jojar Limited, Nitro Switch Limited and HML Consulting Limited, Cognys Systems Limited, Perpetual Communications Limited, Mobile Intelligence Limited and Iyke Jordan Limited, the Nigerian Communications Commission (NCC) announced on its website.

The NCC Board resolved at its 88th sitting held Thursday September 27, this year considered and approved the recommendations for the licensing of the nine companies to offer VAS Aggregator services, according to the telecoms regulator.

The licensing marks a major step forward in the regulator’s plans to level the playing field for the VAS industry under which the new entrant VAS Aggregators will provide a one-stop primary connection to network operators. This is eliminating the need for Content Service Providers to manage multiple physical connections to each of the big mobile networks, NCC says.

Wale Ajisebutu , Vice Chairman/CEO, 21st Century Technologies Limited, one of the new VAS Aggregator service providers licensed by NCC

With the coming of VAS Aggregators, mobile network operators will not be allowed to host or distribute VAS to their subscribers directly, according to new NCC rules.

The telecoms regulator’s plan preventing the big mobile networks from directly offering VAS services has been met with stiff opposition .

According to the telecoms regulator, the VAS subsector of the telecommunications industry consists of four broad segments split as follows:

Professor Umaru Garba Danbatta speaking to Media Executives at the breakfast meeting in Lagos

Segment 1: Network operators Segment 2: Aggregators Segment 3: Content and application service providers Segment 4: Developers of content, applications and platforms

“Network operators will provide final link to the subscriber for the purpose of delivering value added service to the end user. The operators will not be allowed to host or distribute VAS to their subscribers directly. An aggregator will primarily provide a concentration point to limit the number of devices that will be directly connected to the operators. It will eliminate the need for a Content Service Provider to maintain multiple physical connections to each network operator. It will neither be allowed to host or distribute contents and applications, nor will it have access to the information passing through it or perform any data level processing”, according to the NCC rules on the provision of VAS services in the country.

Nigeria VAS Industry | How VAS Market is Segmented

With the coming into force of the new NCC rules guiding the VAS market, the functions and responsibilities have now been spelled out as follows by the industry regulator:

NETWORK OPERATORS

(a) Provide termination service to Aggregators and transmit requests for service from subscribers to content and application providers through aggregators. They must possess a Digital Mobile License, Unified Service Access Service License (UASL) or any other license issued by the Commission which enables the licensee to transmit VAS to end users.

(b)Protection of subscribers from unwanted and unauthorised value added services in accordance with the Commission’s directives and the provisions of this VAS framework.

(c) Provision of billing, revenue collection, publicity and e-marketing services to content and application providers who wish to outsource these administrative services to network operators.

AGGREGATORS

(a) Provide simplified, direct and secure connection to content and application providers for access to all network operators that have the capability to transmit value added services to end users. This service will be limited to multiplexing of signals from various VAS providers and distributing same to all network operators as requested by each content and application provider.

(b)Provide direct link to the internet or International Data Access service providers for content and application providers who wish to market their services globally.

(c) Securely transport content to and from operators and VAS content service provider systems Auxiliary Services

i. Provision of collocation services to those requiring it.

ii. Provision of billing and revenue collection services to content and application providers as may be required.

iii. Provide intermediation for billing verification between parties in the VAS value chain.

CONTENT AND APPLICATION PROVIDERS

(a) Installation of hardware and software platforms for hosting applications and Content. (b)Hosting and distribution of third party applications and contents.

(c) Installing software for processing, counting and logging request for VAS.

(d)Takes responsibility for billing the customer and revenue collection, either by installing an in-house billing platform or outsourcing it to third parties. The content and application provider may collect payment directly from the subscriber via VAS prepaid voucher or other electronic payment platforms. Revenue collection, branding and advertising can however be outsourced to third parties.

(e) Remission of revenue due to developers based on agreed sharing formula. (f) Collaborate with developers in determining a reasonable price for VAS products.

(g)Take responsibility for user authentication, traffic management, security and service delivery. (h)Monitor and manage end-to-end quality of service in conjunction with other market players and taking charge of customer complaints, service level agreements and customer code of practice.

(i) There is no restriction to the types of value added services they can offer except that they cannot offer those that are banned by the Commission and/or those that are not permissible under the relevant Nigerian Laws that may then be in force. For tele-marketing and e-adverts, they must adhere to the modes of delivery specified by the Commission as stated in chapter 5 of this framework and other conditions.

(j) Must meet minimum technical specifications outlined in the technical framework attached as Annexe 1 to this framework.

DEVELOPERS OF CONTENT, APPLICATIONS AND PLATFORMS

(a) A VAS developer must be able to provide valid proof of ownership of an application to be hosted and distributed if required by the content and application service provider.

(b)Take responsibility for obtaining necessary rights, licenses, consent and permissions for content or third –party applications to be hosted on his behalf when required.

(c) Be responsible for payment of all royalties and fees required by third-party owners of content and application. Also, subject to the terms of any agreement between the parties, it shall be responsible for all fines and legal fees emanating from any litigations arising from a breach of third party copyrights and patents.

(d)Must be ready to indemnify the content and application provider against infringement of third party copy rights, intellectual property rights, patents in respect of VAS content or apps for which hosting is requested.

(e) Collaborate with content and application providers and other stakeholders as necessary in determining product price, taking into consideration development, hosting, distribution and overhead costs.