Telecom

Complicated Dynamics of Nigeria’s 2.6 GHz Auction

Published

10 years ago

May 11, 2016

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Nigeria’s telecoms regulator, the Nigerian Communications Commission (NCC) is in the process of auctioning spectrum in the 2.6GHz band. 2.6GHz is a so-called 4G band, allowing the winning bidder to roll-out 4G next generation mobile networks across the country.

There is much riding on this auction; we find the probability for disappointment in the returns from this auction to be fairly high – but this is not merely a matter of value.

The 2.6 GHz auction is the first major, public test of investor sentiment in the country’s telecoms sector over the past few months.

This is a difficult period for the entire Nigerian economy, but it is particularly complicated for the telecoms sector.

Fuel shortages have made operating conditions tougher; economic growth has slowed markedly; the IMF projects real GDP growth of 2.3% this year, down from 2.8% in 2015 and 6.2% in 2014.

Foreign exchange restrictions have hit especially hard, making it difficult to import foreign telecoms equipment and raise foreign capital as financial markets adopt a wait-and-see approach towards Nigeria and anticipate naira devaluation.

Add to that concerns of regulatory heavy-handedness following the record $2.5bn fine levied on MTN Nigeria for failure to disconnect SIM cards and stakeholders have been cautious at best.

The 2.6GHz auction is expected to alleviate some of this angst, and offer the opportunity to participate in a Nigerian mobile connectivity and digital services market that remains unquestionably promising.

We currently estimate it at around $2bn a year, with the potential of at least doubling in size within the next five years. The NCC hopes to generate at least $224m through the sale of 14 lots of 10MHz, at a reserve price of $16m per lot.

And yet, we find the probability for disappointment in the returns from this auction to be fairly high. It’s not a matter of value.

Our assessment of 4G spectrum prices in Africa suggests that on a benchmark basis, the reserve price set by the NCC, if anything, slightly undervalues this spectrum asset.

Indeed, we estimate the median value of Nigeria’s 2.6GHz band, if sold under optimal conditions, at around $20m for a 2x5MHz lot, around 25% above the suggested reserve price.

We see the problem elsewhere, in the very nature of the 2.6GHz band and the structural setup of the auction. We highlight a few points:
• The minimum investment threshold is too high – the NCC is asking for a minimum investment of $64m for 40 MHz. Few operators can come up with and/or justify this amount for this type of investment at this time, and for this particular asset. By comparison, Morocco sold 20 MHz and Ghana 30 MHz in their respective 4G processes; Cote-d’Ivoire sold 40 MHz, but as part of a broader mix of frequencies including 2G and 3G, which raised overall value.

• Further, we believe the sale of the 2.6GHz on a stand-alone basis drags down the intrinsic value of this offering. The 2.6GHz band is best used as high-density, urban area complement to lower-band spectrum. Sold alone, it loses some of its attractiveness. In the majority of African 4G transactions in which 2.6GHz was offered, it was typically auctioned as part of a mix of 4G frequencies including the lower-band 700MHz or 800MHz. Few other markets -outside of Ghana’s narrow fixed wireless access (FWA) process of 2011- have sold 2.6GHz on a stand-alone basis. By selling 2.6GHz on a stand-alone basis, Nigeria is in effect selling 4G spectrum at FWA conditions.

• An operator purchasing the 2.6GHz would have no first-mover advantage in Nigeria. In nearly all other cases of 4G licensing in Africa, the players acquiring the spectrum are the first to roll out the services at scale. By contrast, Nigeria already has 5 LTE players (using 800MHz or 2300 MHz), at least 4 of which are specifically targeting the high-density urban areas that the new owner of the 2.6GHz band would presumably target. And nearly all these other players acquired their licences at a value point 3 times lower than the requested reserve price.

This all makes for interesting dynamics around the auction. The one company that could potentially afford the band, MTN Nigeria, doesn’t really have to have it.

MTN Nigeria acquired Visafone primarily for its sought-after 800MHz spectrum and has announced it will launch LTE in July 2016. Acquiring the 2.6GHz would still be useful, but arguably not enough to overbid.

Other GSM operators in need of 4G spectrum will have to assess whether this is the best use of capital, an equation complicated by the lack of visibility on the availability of the preferred 700MHz band. An operator without the lower band option would be (and indeed, should be) hesitant to invest in the 2.6GHz even at the suggested reserve price, only to be limited to high-density areas where competition is the fiercest.

In this case, the driving rationale for an investment would be not to be left behind – but the 2.6GHz is really only a small step while waiting for the real (and more expensive) prize, the 700 MHz or 800 MHz band.

The question is therefore how aggressive to be on 2.6GHz when this is not the most critical piece to have.

And indeed, an argument can be made that an aggressive bid for Smile Nigeria or Intercellular (who hold the last remaining 800MHz chunks) would be more sensible than a strong play for 2.6 GHz spectrum – though one does not exclude the other.

For the Nigerian government, the real proceeds are not in the 2.6GHz auction in our view. They are in finding a way to bring the 700 MHz or whatever might be left of the 800 MHz to market as soon as possible.

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Telecom

Mandatory Biometric Verification for Starlink Users in Nigeria Begins

Published

1 day ago

January 7, 2026

Ebere Melum-Nwogbo

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Users of satellite internet service provider Starlink in Nigeria are being required to complete a biometric Know Your Customer (KYC) process as a precondition to continue enjoying their services, according to .biometricupdate.

Mandatory Biometric Verification for Starlink Users in Nigeria Begins

According to local reports, more than 66,000 Starlink subscribers in the country had a December 31 ultimatum from the Nigerian Communications Commission (NCC) to complete the biometric verification or have their connection discontinued.

The process essentially entails linking a Starlkink account with the subscriber’s national digital ID.

The NCC, which is Nigeria’s telecoms industry regulator, is said to have first issued the directive in August last year, setting a three-month deadline which was to elapse on November 19, TechCabal reports.

The body however later extended it to December 31 after consultations with industry stakeholders. The internet account-NIN linkage, the NCC said, is to enhance identity verification and strengthen security within the country’s telecoms space.

Just a few days to the December 31 deadline, Starlink’s Nigeria office sent an email to its subscribers reminding them of the KYC requirement, and warned that all those who fail to comply would be disconnected.

And that once disconnected, reconnection would depend on network capacity in the concerned area.

The service provider said in its email that the process takes less than two minutes and users can complete it by logging in to their account via an app.

One user, quoted by TechCabal, said one needs to upload their selfie biometrics, provide their national identification number (NIN) and then give their consent for the account to be linked to their ID information.

Starlink’s internet service is present in about 155 countries with nine million users, as of 2025. Its growth in Nigeria is said to be rapid, making it the second largest internet service provider in the country, according to The Traffic.

Biometric identification for Starlink subscribers could become a continent-wide trend given that some countries have expressed reservations in opening up their internet space to the company over security concerns.

There’ve been fears that jihadists in countries like Mali and Nigeria may have exploited Starlink terminals to coordinate terror operations, and cybersecurity experts have also warned of risks related to weak regulation, digital sovereignty and data breaches.

The requirement for Starlink internet users to have their accounts linked with the NIN is similar to the SIM-NIN linkage policy which the Nigerian government battled to implement for many years, with many deadline extensions.

In October last year, the NCC, which is was at the forefront of the policy implementation, announced that all active SIM cards across all network providers had complied with the directive which was issued in 2020.

The idea, the federal government argued, was to strengthen security and curb criminality such as kidnappings which are aided and abetted by improperly identified mobile phone numbers.

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Telecom

NITDA DG Charts Bold Path for Innovation-Led Digital Boom in North

Published

1 day ago

January 7, 2026

Ugo Onwuaso

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Mr. Kashifu Inuwa, Director General of the National Information Technology Development Agency (NITDA), has urged Northern Nigeria to pivot urgently from traditional commerce to an innovation-driven digital economy for sustainable growth.

NITDA

Inuwa issued the call at the Future Map Foundation Roundtable 1.0 (North-West Edition) in Kano, attributing the region’s sluggish digital adoption not to talent deficits but to the lack of deliberate, coordinated strategies.

He stressed deeper collaboration across academia, private sector players, entrepreneurs, and government, positioning the private sector as the primary innovation engine while government supplies robust policies and an enabling ecosystem.

Inuwa advocated for people-focused, locally tailored innovations that tackle regional challenges head-on, enabling global competitiveness by transitioning from mere technology users to creators of homegrown solutions.

The roundtable convened policymakers, tech founders, and ecosystem stakeholders to forge a comprehensive roadmap for North-West digital transformation, yielding firm commitments to bolster regional innovation policies and public-private synergies.

Inuwa’s push dovetails seamlessly with the Federal Government’s Renewed Hope Agenda, which sets an ambitious target of 95 per cent nationwide digital literacy by 2030, fostering inclusive economic empowerment.

Participants hailed the forum as a pivotal step toward unlocking Northern Nigeria’s tech potential, with NITDA poised to lead implementation through strategic interventions and partnerships.

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Telecom

Samsung Plans to Double AI Mobile Devices to 800 million Units this Year

Published

2 days ago

January 6, 2026

Chike Onwuegbuchi

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Samsung Electronics plans to double this year the number of its mobile devices with “Galaxy AI” features largely powered by Google’s Gemini, its co-CEO said, which would give the U.S. firm an edge over rivals as the global race in artificial intelligence heats up.

The South Korean company, which had rolled out Gemini-backed AI features to about 400 million mobile products, including smartphones and tablets, by last year, plans to boost that figure to 800 million in 2026.

“We will apply AI to all products, all functions, and all services as quickly as possible,” T M Roh told Reuters in his first interview since becoming Samsung Electronics co-CEO in November.

The plan by the world’s largest backer of Google’s Android mobile platform is set to give a major boost to its developer Google, which is locked in a race with OpenAI and others to attract more consumer users to their AI model.

Samsung seeks to reclaim its lost crown from Apple in the smartphone market and fend off competition from Chinese rivals not only in mobile telephones, but televisions and home appliances, all overseen by Roh.

It will offer integrated AI services across consumer products to widen its lead over Apple in such features, though the latter was set to be the top smartphone maker last year, according to market researcher Counterpoint.

AI Race

Alphabet’s Google launched the latest version of Gemini in November, highlighting Gemini 3’s lead on several popular industry measures of AI model performance.

In response to Gemini 3, OpenAI CEO Sam Altman reportedly issued an internal “code red,” pausing non-core projects and redirecting teams to accelerate development. The ChatGPT maker launched its GPT-5.2 AI model a few weeks later.

Roh expects the adoption of AI to accelerate, as Samsung’s surveys on awareness of its Galaxy AI brand jumped to a level of 80% from about 30% in just one year.

“Even though the AI technology might seem a bit doubtful right now, within six months to a year, these technologies will become more widespread,” he said.

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