NCC Moves to End Unfair Transmission Cable Pricing, Monopoly

Nigeria n Communications Commission (NCC) in its tradition of harnessing stakeholders’ views before issuing out regulatory guidelines, on Tuesday, in Lagos, sought to know industry players’ input towards tackling unfair transmission cable pricing in the nation’s telecommunication sector.

Dr. Eugene Juwah, executive vice chairman of NCC, said that the commission heeded stakeholders cry to address the lingering arbitrary, predatory and discriminatory pricing inherent in the transmission line market segment.

On the heels of this, the NCC commissioned KPMG, a global network of professional firms notable for providing audit, advisory and tax services; to carry out a study on the matter.

Barely a year ago, NCC held a similar interactive Forum with focus on ‘Dynamics, Pricing and Related Matters’, where representatives of the operating Companies raised issues such as discriminatory and arbitrary pricing; predatory pricing; denial of access routes, among others.

Juwah, who was represented by Mr. Okechukwu Itanyi, executive commissioner, Stakeholder Management at NCC, at the Stakeholders Forum on ‘Transmission Cable Pricing’ said that on conclusion of the cost based transmission cable pricing study and on the verge of developing strong enforcement regulations, “the policy of the Government on Communication is that prices should be determines by market forces, but it also recognizes that in the journey from monopoly to full market competition, there would be period(s) of transition when competitive market forces may be inadequate to bring about efficient market conduct and prices that are close to costs”.

“In such situations, Juwah said, “the policy provides that regulatory intervention goes into effect. In the discharge of our regulatory and oversight functions, we are committed to participatory regulation and shall continue to ensure wide consultation before major decisions affecting the industry are taken”.

The EVC noted that, consequently, stakeholders’ inputs will be taken into accounts in finalizing the study.

Nodding in agreement, Ms. Josephine Amuwa, director, Policy, Competition & Economic Analysis at NCC, said that KPMG was contracted to carry out the study, comparing other markets and the International Telecommunications Union (ITU’s) standards.

According to her, part of the Study revealed that there are unfair practices in the industry as regards transmission cable pricing which were capitalized on by two dominate operators.

Amuwa said, “We Commissioned the Study in 2012 and on the process, we discovered that there are two dominate operators. Dominance on itself is not bad; a Regulator will not punish them, but will ensure they do not make the market uncompetitive. That is one of the reason KPMG was charged to use data provided by operators, weigh them in line with global best practices, while giving credence to ITU guidelines”.

The Director added that in the wake of clamour for ‘broadband Nigeria’, transmission market segment becomes even more relevant, as there are few players due to the inhibitive entry challenges.

Such challenges, she said include, right-of-way (RoW), double taxation, among other, through which monopoly crept in and led to anti-competitive environment, unfair pricing, refusal to use ducts, refusal to use supply channels, duplication of infrastructure and ultimately poor quality of service (QoS).

Speaking on behalf of the researchers, Mr. Joseph Tegbe, partner and head, Telecoms, Media and Technology Management Consulting at KPMG, said that it took them one year to gather data from operators, however, the exercise has paid off with the Study ready for stakeholders to consider issues involved.

While fielding questions from operators who wanted to know about the pricing models adopted in the report, considerations for geographical locations with peculiarities and other market indices, Tegbe advised them to use the two week window created by NCC for further input before the wholistic regulatory framework will be released.

In telecommunications, transmission cable depicts a system that transmits a signal from one place to another.

Simply put, it is the medium through which data (information) is transmitted from one point to another, for people’s daily usage of the internet, mobile network, cordless cables, among others.