Telecom
Creating Enabling Environment for Increased Investment in Telecom
Investment is critical to development of any sector of an economy. Massive investment in a sector is an ingredient of how vibrant, and competitiveness of that sector which result in good quality of service delivery to consumers in that sector. Against this backdrop that stakeholders in the telecommunications sector of the country’s economy are craving for an increased investment in the sector. However, the high growth rate recorded in the sector is premised on the investment and vibrancy of telecommunications as a sector in the economy.
Engr. Ernest Ndukwe, chief executive of the Nigerian Communications Commission, has said that telecoms investment in Nigeria in the last eight years has exceeded USD18 billion.
The current investment figure is made up of about US$12 billon from foreign direct investment while the balance is from investments made within the country since 2001.
He said government’s invitation to the private sector for participation in the industry has paid handsomely and led to the current success indices in the sector.
The NCC boss said that the decision by Nigeria to implement a technologically neutral regulation has resulted in investments in both the GSM and CDMA based services and made diverse services available in Nigeria with investors attacking services from different points thereby providing choices for the Nigerian consumer.
Aside the $2.6 billion generated through licensing fees from the GSM, notable investment witnessed in the sector especially through acquisition of local operators by foreign ones include, Telkom of South Africa’s 100% acquisition of Multi-Links for $350 million, MTN acquisition of VGC Communications at $65 million, MTN acquisition of XS Broadband for $32.1 million and Zain acquisition of over 60% stake in Vmobile for $1billion. Also, Sudatel has acquired 70% stake of Intercellular at $60 million. On the local front Visafone acquired some CDMA operators to become the largest operator in that space. The acquired CDMA operators are Independent Telephone Networks (ITN), Bourdex and Cell Communications although the company refused to disclose the cost of these acquisitions but industry watches believed the deals worth over N3 billion.
In fact, the eight year of telecom sector reform has brought about substantial private sector investment, increase in the number of market players, unprecedented growth in the network, expanded geographic coverage, empowerment of citizenry, employment creation and economic stimulus.
The role of a regulator and government in developing telecommunications sector is demanding and encompasses far-reaching and multi-disciplinary issues. To be successful, the functions should be based upon a well defined set of objective which typically includes attracting investment, infrastructure planning and development, sector efficiency, encouragement of competition among others.
As the economy of the nation continues to look up and with pressures from global financial markets, and the position of Nigeria as a major commercial centre in the West Africa region, the demand for reliable and modern telecommunication infrastructural facilities is heavy.
Nigeria must therefore be viewed as a major market for telecommunications equipment and services in technology areas such as: digital transmission system (including microwave, satellite and optic fibre), submarine communications, digital exchanges (wired and wireless), billing systems and data communications networks including primary rate ISDN and Broadband ISDN services. The Federal Government of Nigeria should be interested in attracting local and international operators to come and participate, in the urgently needed expansion of her telecommunications infrastructure by providing the enabling environment for the intending investors to play in.
Obstacle to investment
There are challenges in the telecom sector that are inimical to investment which need to be addressed if the country will attract the desired massive investment she is looking for to sustain growth as well as bring development in the sector.
Some of these challenges according to Gbenga Adebayo, chairman of the Association of Licensed Telecommunications Operators of Nigeria (Alton), could hinder the sustenance of the growth, if they are not nipped in the bud. He listed some of the challenges as multiple regulation, government interference in telecom matters, multiple taxations, insufficient broadband rollout in the industry, security of infrastructure, quality of service, inadequate power supply, and state of access roads, among others.
He advocates the independence of industry regulator such that the regulator must be free from political interference which was witnessed in the licensing of 2.3 GHz spectrum. Multiple regulation he said is a bane of growth and government must continue to provide the right regulatory and policy environment without crisscross between various arms of government.
Adebayo called for the scrapping of all forms of levies and fees charges by various agencies of government on right of way approvals, insisting that they are all inimical to a true regulatory framework in any society.
He also explained that capacity building is critical for the sustenance of telecom development and that more effort is needed from government to ensure that the technical manpower requirements for the information and communications technology (ICT) industry were met. This, he said, was traceable to challenge in the socio-economic environment and the guaranteed minimum quality of lives and that the industry was loosing a number of highly trained personnel to other countries with less potential, but with better social security and standard of living and economic values, better healthcare, better education guarantees for their children, better security of lives and properties and quality of living.
He reiterated the fact that telecommunications in Nigeria remained the most functional and reliable public social infrastructure, while calling on stakeholders to continue to do the needful to sustain the growth and stability of the telecom sector of the economy through the provision of enabling environment for investors both local and foreign.
In order to optimize and accelerate development in telecoms sector in the country, attention must continue to be paid to these key issues that affect investment.
The sector today requires massive inflow of private investment for infrastructure upgrade and expansion. Half-hearted liberalization measures have denied many African countries access to investment that could have been available to the sector both from within and outside such countries. Governments must therefore resist pressures to protect incumbent operators to the detriment of truly competitive markets.
The need for government to provide the right environment that will attract serious investors and for market forces to thrive cannot be overemphasized. All policies must of necessity be aimed at attracting new sources of capital, accelerating network expansion, improving pricing, enhancing quality of service, introducing of new technologies and providing access to ICT resources to all citizens at affordable prices.
The expansion of telecommunications facilities must go side by side with the development of human resource capacity that will support the industry. We must develop knowledge, skills and competencies to understand, plan and deploy the complex networks of wireless systems, fibre optics, satellite systems, and a host of other information and communications technologies.
Industry watches that spoke to Nigeria CommunicationsWeek believed that attracting massive investment in the telecom industry goes beyond providing a good regulatory framework which NCC has done, and that environmental as well as operational challenges are very key to achieving it.
They cited instances of bureaucratic bottleneck in securing approval for deployment of telecom infrastructure which state and local governments give. They also decried unending demand by government agencies for one levy or the other, for example, MTN disclosed that an environmental agency demanded that it pays N1million every year on its mast. Recently, some manufacturing companies in the country have started relocating their production factories to neighbouring countries that have improved social infrastructure especially power which accounts for over 60 per cent of cost of production in the country. Telecommunications sector is not different, imagine where an operators do not have to provide generators and its rising maintenance cost on its so 5,000 base station what such operator would be saving.
Such an operator will be saving the cost of 10,000 generators at a cost of N2million each as well as cost of fueling such generators where it runs on it for 17 hours in a day. Operators will not face the problem of theft of these generators that is now target to armed robbers.
All these challenges make nonsense of most business projections and speculation of foreign investors into the country, which has resulted in scaring them away from investing in the country. The earlier these issues are addressed the sooner the realization of the much needed massive investment in telecommunications space that will bring about development in the sector.
MTN Group has moved a step closer to taking full ownership of telecommunications tower operator IHS Towers, after shareholders of the infrastructure company approved the proposed acquisition at an extraordinary general meeting (EGM).
The telecommunications group announced that IHS shareholders voted in favour of the transaction by the required two-thirds majority at the EGM held on 4 August, satisfying one of the key conditions precedent to the deal.
MTN first announced in February that it had entered into an agreement to acquire the remaining shares in IHS, a move that would give the mobile operator full ownership of one of Africa’s largest independent tower companies.
The acquisition forms part of MTN’s Ambition 2030 strategy, which aims to strengthen the group’s digital infrastructure capabilities and diversify revenue streams as demand for connectivity, cloud services and artificial intelligence (AI) continues to grow across the continent.
“The approval by IHS shareholders is an important step toward completion of the transaction,” says Ralph Mupita, MTN Group president and CEO.
“Within our Ambition 2030, the three-platform strategy, towers are a critical value-creation driver that will strengthen MTN’s strategic and financial position for the future, in a world where digital infrastructure and AI are becoming increasingly essential to Africa’s growth and development.”
Tower infrastructure has become increasingly strategic for mobile network operators as demand for high-speed mobile broadband, cloud computing and AI-powered services drives the need for expanded and more efficient network capacity.
The proposed acquisition is expected to strengthen MTN’s position as it continues expanding its digital ecosystem across Africa, where it serves more than 300 million subscribers.
IHS is one of the world’s largest tower companies, with nearly 29 000 towers in Africa serving various mobile network operators in five key MTN markets.
According to the mobile operator, the proposed transaction, which follows discussions noted in February, marks an important step to unlock compelling value for MTN, and strengthen and reintegrate its ownership of critical digital infrastructure across Africa.
For IHS shareholders, MTN notes, it provides an attractive opportunity to crystalise value.
The funding for the proposed transaction of the remaining shares MTN does not already own, for a consideration of $2.2 billion (R35 billion), will be through cash of approximately $1.1 billion on IHS’s balance sheet, along with available liquidity and debt from MTN.
MTN has approximately 24.7% shareholding in IHS, and as part of the transaction, it intends to take the company private through the acquisition of all outstanding shares it does not own, pursuant to a cash merger.
By reintegrating the tower assets, MTN says it will be able to internalise the margin currently paid to IHS, benefit from current and future incremental third-party revenues, improve cost predictability and unlock significant long-term value embedded in its existing investment.
The transaction remains subject to the receipt of the necessary regulatory approvals, which MTN says are still in progress. No timeline has been provided for the completion of the acquisition.
Telecommunications services provider Airtel Nigeria has further extended its national retail footprint with the rollout of 350 out of a planned 500 premium experience centres, which are designed to bring faster, more convenient service closer to millions of Nigerians.
The new retail shops, officially unveiled at a symbolic launch at City Mall, Onikan, Lagos, mark the latest phase in Airtel Nigeria’s grand retail strategy. They significantly expand the company’s extensive network of over 9,000 exclusive shops across every local government area, more than 350 premium experience centres, and over 73,000 retailers in all top towns and cities nationwide.
Built as compact, high-efficiency touchpoints, the newly launched shops are designed to enable subscribers complete all transactions such as Home Broadband, Fiber and Outdoor Units Subscription, Postpaid Plan Subscription, Enterprise Applications Enquiry and Subscription, as well as Prepaid Product services such as SIM registration and Data Plan purchase, other enquiries and comprehensive account support.
Simultaneously, several shops commenced operations at Purple Mall, Lekki; Marina, Lagos Island; Magodo, Lagos; Oke-Ilewo, Abeokuta; Trend Setter Mall, Benin; Abakaliki, Ebonyi State; Kano City Mall, Kano; Carpenters Mall, Gwarinpa, Abuja; and other parts of the country.
The rollout emphasises the company’s continued investment in customer experience and responds directly to feedback from customers seeking quicker access to everyday services without the longer waiting times that may be associated with larger retail centres.
Speaking on the company retail objectives, Joypratip Sengupta, Director, Sales and Distribution, Airtel Nigeria, explained that quality retail experience ultimately drives customer satisfaction. “Our goal is to demonstrate our dedication to exceptional quality of service, and these new shops, by their design, location, and equipment fit right within our goal to deliver superior service to every one of our customers,” he said.
He added that the expansion reflects Airtel Nigeria’s belief that excellent customer experience goes beyond technology to ensuring customers can receive support whenever and wherever they need it.
“Our business at Airtel is to ensure that we bring our services closer to our customers, and everything we do is centred on putting the customer first. These experience centres are open to help customers carry out their transactions faster and with greater ease. Whether you want to replace a SIM, purchase one of our routers, recharge airtime or data, or resolve any service issue, you can now do so more conveniently and closer to where you are,” he said.
He explained that the initiative represents a significant update to Airtel’s retail strategy, placing greater emphasis on accessibility, speed, and convenience.
“These express shops are designed to reduce traffic at our larger shops while giving customers faster access to the services they need. More importantly, they reinforce our vision of building the most accessible customer service network in Nigeria. As the telecom operator with the country’s largest retail footprint, we will continue expanding into more neighbourhoods, making it easier for customers to connect with Airtel wherever they are,” Sengupta noted.
In her remarks at the launch, Lynda Amechi, Head, Shops and Retail Postpaid Business, revealed that the new retail model was born from listening to customers and reimagining how Airtel delivers its services.
She said, “At Airtel, some of our best ideas come directly from our customers. One of the recurring concerns we received was the time customers sometimes spent waiting at our larger experience centres, even when they only needed simple transactions completed. We listened carefully and realised that many of these requests could be resolved within minutes if we brought our services closer to the communities where customers live and work.”
These new shops are also integrated into Airtel Nigeria’s broader customer experience agenda, which have seen the company continue to invest in digital self-service platforms, AI-powered customer support, nationwide customer forums, and significant network expansion across the country.
With this phase of shop launches, Airtel Nigeria has expanded customer access across the country while integrating digital innovation into physical touchpoints.
The Presidential Renewed Hope Media Tour has commended the National Agency for Science and Engineering Infrastructure (NASENI) for its progress in advancing indigenous technology development, describing the agency as a key driver of President Bola Tinubu’s Renewed Hope Agenda and Nigeria’s industrial transformation.
The commendation came during a visit by the presidential media delegation to NASENI’s headquarters in Abuja, where members inspected the agency’s technology and manufacturing facilities.
Speaking on behalf of the delegation, Mr. Bayo Onanuga, Special Adviser to the President on Communication, Information and Strategy, described the agency’s achievements as “impressive, impressive, impressive.”
He said NASENI’s progress demonstrated the capacity of Nigerian youths to excel when provided with the right leadership and support.
Onanuga also praised the leadership of the Executive Vice Chairman and Chief Executive Officer of NASENI, Khalil Suleiman Halilu, for repositioning the agency to support the Federal Government’s industrialisation objectives.
In his remarks, Halilu said sustainable industrial growth does not necessarily depend on producing goods entirely from local inputs but requires strategic investment in technology development, innovation and partnerships.
He explained that the agency is focusing on commercially viable innovations capable of creating jobs, reducing production time and supporting the Federal Government’s Nigeria First Policy.
According to him, NASENI is also strengthening technology transfer, commercialisation of research outputs, mentorship programmes for innovators and the Innovate Naija Challenge, which offers a ₦500 million prize fund to support promising Nigerian innovations.
The Minister of Information and National Orientation, Mohammed Idris, commended NASENI’s achievements and urged the media to give greater visibility to the Federal Government’s programmes and accomplishments across various sectors.
Also speaking, Hadiza Bala Usman stressed the need for stronger strategic communication and increased patronage of locally developed technologies and innovations.
Similarly, Sunday Dare advocated policies that would encourage Ministries, Departments and Agencies to prioritise NASENI products and other locally manufactured goods.
Other members of the delegation, including Tunde Rahman and Otega Ogra, also commended the agency’s strategic partnerships and locally developed technologies.
During the tour, the delegation inspected facilities dedicated to drone technology, helicopter assembly, reverse engineering, precision manufacturing, renewable energy, agricultural technology and recycling systems.
The visitors also witnessed the implementation of NASENI’s 3Cs framework—Creation, Collaboration and Commercialization—which the agency said is driving indigenous manufacturing, innovation and technology transfer.
At the end of the visit, stakeholders called for sustained nationwide campaigns to promote Nigerian-made products, strengthen local manufacturing, reduce dependence on imports and accelerate the country’s industrialisation agenda under President Tinubu.
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