President Goodluck Jonathan’s ‘Democracy Day’ speech last week left little to ponder concerning his roadmap on the ICT industry as his one paragraph take on the sector simply identified his establishment of the Ministry of Communications Technology (MCT) and its mission. It was a long thesis on his one-year scorecard.
But while industry stakeholders worry about the President’s little exposition on ICT, the bigger headache remains the ongoing imbroglio between the Nigeria Communications Commission (NCC) and mobile operators, which seem headed for a head-on-collision.
With connected active mobile subscription now in excess of 99 million (total existing customer base stood at 119,460,789 million) by end of March 2012, Nigeria continues to be the leading market in the Middle East and Africa (MEA) region.
Despite this phenomena growth in over a decade of market liberalization, the telecom landscape is underpin by under development occasioned by lack of governments’ investment in infrastructure.
There is also the notoriously epileptic public power supply which has defied several governments’ attempts at revamping it.
Investors are forced to have power generation as part of business plan in other to survive in this striving market. But the cost of operating private power to generate electricity for industries builds into operational cost resulting in high prices of commodities and services.
The mobile industry has had a long running battle with customers who accuse operators of shortchanging them in price fixing compared to other African markets.
But the operators are also quick to point at the fact that operational cost is sometimes 10 times higher in Nigeria than other African markets due to infrastructure and logistic deficiencies.
Emeka Oparah, vice president corporate communications at Airtel Nigeria, believes it is more profitable doing business in Malawi than Nigeria because of infrastructural challenges.
“Why should Malawi, one of the poorest countries in the world, have a more stable power supply than the clay-footed giant of Africa? And so a business in Malawi is more profitable than its peer in Nigeria,” said Oparah in a facebook post.
Industry watchers also acknowledge that MTN Nigeria is Nigeria’s biggest diesel distributor due to its vast network of infrastructure built across Nigeria’s 923,768 sq metres landmass. Despite huge investments pumped into infrastructure by the four major telecom operators – MTN, Globacom, Airtel and Etisalat – the challenge of service delivery persist.
In May the Nigeria Communications Commission (NCC), the industry regulator imposed a hefty combine N1.17 Billion fine on these four majors for poor service delivery. They were expected to pay up on or before May 25, but none has paid up even to this moment.
Last week there was a meeting between the majors and the NCC on the fines, but it ended in deadlock leading to further imposition of N2.5 million daily fines on the operators until they pay up.
Tony Ojobo, director of public affairs at NCC said the operators didn’t show remorse and offered to word on their payment schedule.
“The point is that there are specifications in the guidelines that after the deadline for the sanctions there is going to be N2.5 million for each day of default and we are already in default period and it is expected that the sanction as well as the default penalty will have to be paid,” said Ojobo.
Ojobo said the commission was not on witch-hunting expenditure, but rather accuse the telcos of failing in their KPI (key performance indicators) measurements.
But more worrisome is NCC threat of further sanctions that appear more severe than monetary fines. Ojobo mentioned withdrawal of “regulatory services such as the issuing of new numbers or entertaining any request whatsoever from the service provider. The regulator has a number of regulatory tools to get the service provider to conform or obey the regulatory rules.”
Perhaps its time Mrs. Omobola Johnson, minister of communications technology steps into the matter. It is pertinent for government to look into operators’ grievances and not wave them aside. The government cannot be transversing the globe seeking investors while not seem to be treating those already here with flippancy.
The continued beating of war drums by both parties could only send wrong signals to investors who already have enough to worry about with the al-Qaeda linked Boko Haram insurgence in the North. It is in the nation’s interest to have a conducive operating environment for all investors.