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From Telecoms Backwaters to a Regional Hub - Tracking the Role of the Regulator in Telecom [analysis]
[December 08, 2008]

From Telecoms Backwaters to a Regional Hub - Tracking the Role of the Regulator in Telecom [analysis]

Dec 08, 2008 (Vanguard/All Africa Global Media via COMTEX) --
That no modern economy can be sustained today without an integral telecommunications infrastructure is widely acknowledged. Robust telecommunications network is important for the economic growth of nations and constitutes a base infrastructure that supports the world economy. Communication is a vital aspect of human existence and effective telecommunications services enhance living standards and improve productivity and efficiency in other sectors.

Thus communications and the technologies that support it, occupy a strategic position now more than ever in every aspect of human existence; and nations and businesses would become less competitive and lag behind others if they fail to avail themselves of this vital infrastructure of the Information age.

For Nigeria, the Information and Communications Technology (ICT) penetration in 1999 when the transition to democratic rule occurred was very low and less than 1% of the population of this vast country had access to a telephone. The new government identified that this was a major hindrance to development of the nation and decided that there was an urgent need for transformation in the (ICT) sector to stimulate the economy and open up new possibilities across her business, political, social and economic spheres.


In fact by year 2000 Nigeria had only 400,000 connected telephone lines and 25,000 analogue mobile lines. The total teledensity stood at a paltry 0.4 lines per 100 inhabitants. Connection costs were prohibitively high, and waiting time for fixed lines ran into years. Today, thanks to several factors which include Government sector reform policy, an enabling investment climate, the worldwide trend of rapid development in ICT, and the huge potential of the Nigerian market, the story is very different.

A comprehensive new sector legislation, the Nigerian Communication Act (NCA) was enacted in 2003 repealing the 1992 NCC Act. The new Act was to further the full liberalization of the sector and provide the ground rules for the orderly development and governance of the telecommunications sector.

In the ensuing 8 years from 2000, the Nigerian Communications Commission (NCC) licensed several Digital Mobile Operators, Fixed Wireless Access Operators, Long Distance Operators, Internet Service Providers, a Second National Carrier and recently, Unified Access operators. All these have had the collective effect of ensuring full competition in all segments of the telecommunications market. They have also had the effect of promoting rapid deployment of telecom services, resulting in exponential growth in the number of telephone lines in Nigeria.

Whilst between Nigeria's independence in 1960 and the end of year 2000, the number of connected lines grew at an average of 10,000 lines per annum, since 2001 the telecommunications industry has witnessed an average growth rate of about 8 million lines per annum. By the end of October 2008, Nigeria had attained about 59 million lines, (57.6 million of which are digital mobile lines), and the teledensity figures soared from the 0.4 lines per 100 inhabitants recorded in 1999, to 42 lines per 100 inhabitants by the end of October 2008.

The progress recorded in the industry has been brought about by Government liberalization of the sector and opening up of the market to private investment. The market reform has helped to accelerate investment flow into the sector and resulting in the rapid roll out of multifarious communications services. This sector transformation has also impacted other sectors of the economy and led improvements in efficiency and productivity, reduction in transaction costs, increased service innovation and better quality of life.

In spite of the liberalization in the sector, Government has had a vital role to play in catalyzing the development and growth of the nation's telecommunications infrastructure and in ensuring the continued existence of a competitive environment that fosters continuous growth and consumer satisfaction. Government achieves this role through the enactment of progressive policy and legal framework for the sector and the establishment of a strong independent Regulatory authority.

Therefore, the role of the Nigerian Communications Commission as the industry Regulator has been to encourage competition, remove barriers to market entry, oversee interconnection of new operators with incumbents, monitor tariffs and quality of service, protect consumer rights and ensure that affordable telecommunications services are available to all Nigerians.

Telecommunications Backwaters - A Historical Perspective
The development of telecom in Nigeria started in 1886 with the laying of the first telegraphic submarine cable by the British firm, Cable & Wireless Ltd. At independence in 1960 Nigeria had 18,724 fixed telephone lines. In 1962, the Nigerian government teamed up with Cable & wireless as a senior partner to establish the Nigerian External Telecommunications Ltd. (NET) to handle international Gateway services. Telecom and postal services were under the Department Post and Telecommunications (P&T) in the Ministry of Communications.

By 1984/85 Nigeria separated postal and telecom functions of the P & T Department and consequently, NITEL was created as a commercialized entity and monopoly Telecommunications operator. However over the ensuing years, NITEL was not able to meet up with public expectations and demands for services. Network expansion was slow and service delivery was very poor and expensive. Between 1960 and year 2000, the active subscriber base rose to about 400,000 fixed lines (for an estimated population of 120 million). A proper analysis of the 400,000 active subscriber lines indicated that at least half of those lines were actually official phone lines owned by corporate and Government entities. What this suggests is that Nigeria, in spite of her population and economic potential by the year 2000, did not have more than 200,000 individual families with telephone lines at home!

Although cellular telephony services were launched in Nigeria in the mid 1980s, by the end of year 2000, the number of active cellular subscribers was just 20,000. This figure represents an average annual growth rate of only about 1,250 subscribers per annum. There were only two countries in the world in 2000 which had teledensity levels that were worse than that of Nigeria - Afghanistan and Mongolia.

With the fore going statistics, the Nigerian Government was fully aware of the desperate need for growth in its telecommunications sector. Along with other forward looking and progressive developing countries, Nigeria having identified the need for considerable investment in this sector to expand and upgrade networks, expand subscriber base and introduce market_based approaches to the supply of telecommunications services, moved towards liberalization of her telecommunications industry.

Government decided to embark on market oriented reforms, partially liberalizing the Nigerian telecommunications sector via NCC Decree 75 of 1992. Some of these reforms include amongst others Separation of the policy_making body (MOC) from industry regulator and network operators and the establishment of the Sector Regulator, the NCC, in 1993. Despite the huge potentials offered by the Nigerian telecom market, progress was slow due to the fact that military rule was not favourably disposed to independent regulatory performance. Political uncertainties and perceived policy inconsistencies, among other shortcomings prevalent at the time had combined to make for relatively unattractive investment climate in Nigeria.

Though licensing of network operators and service providers only began in 1996, NITEL however continued to retain monopoly over National long distance services, International gateway services and Mobile Telephony services. It is an established fact that most countries that tried partial liberalistion did not achieve any appreciable success in attracting investment into the sector.

Not much was therefore achieved until 1999 when democratic governance was enthroned and a new board of the Commission appointed in April 2000. A new telecom policy was subsequently crafted by a representative stakeholder group and released in September 2000, the hallmark of which was the blueprint for full liberalization of the telecom industry.

The NCC immediately proceeded to open up to competition, all market segments including those previously held exclusively under the monopoly incumbent operator e.g. the national and international long distance services, mobile services, etc. Government also ensured the creation of a level_playing field with the incumbent operator, NITEL, being brought under the regulatory oversight of the NCC and NITEL was formally issued an operating license in 2001.

The Telecom Revolution
Before the advent of the Digital Mobile Communications services launched in August 2001, (popularly referred to as GSM services in Nigeria) ownership of telephones was the exclusive preserve of the rich and the well connected in the Nigerian society.

Seven years on, the growth of the telecommunications sector is unmatched by any other sector and it has recorded phenomenal growth both in terms of subscriber's base and infrastructural development in the country.

Today, GSM phones beep in almost every palm, pocket, handbags, offices, markets, parties, school hostels, hotels beer parlors and others. Nigeria has mobile signals in all the states of the federation.

A number of our major highways are covered by mobile services; several rural communities have access to one form of telecommunications service or the other; our law enforcement community have the necessary tools to keep in touch with their bases; medical practitioners have had their work facilitated by telecommunications services; and both small, medium and large scale businesses have been empowered by these vital ICT tools. Indeed, the Nigerian economy has been impacted positively through job creation, improved business performance, and timely information exchange.

Digital Mobile License (DML) Auctions
In January 2001, the Commission conducted an auction for Digital Mobile Licenses. This auction was acclaimed locally and internationally as one of the best in the world thanks to the high level of transparency exhibited during the exercise. The auction brought about the emergence of three mobile networks; ECONET Wireless (now ZAIN), MTN and MTEL, (a subsidiary of the incumbent national operator the Nigerian Telecommunications Limited _ NITEL) In 2002 a fourth Digital Mobile License was issued to Globacom (Glomobile) through another transparent auction process for a Second national Carrier License

The transparent manner in which the Commission handled the DML gave the impetus to other licensing auctions that followed.

These include, the Second National Operator (SNO) license granted to Globacom, Fixed Wireless Access (FWA) licenses on regional basis granted to 24 companies, the Unified Access Service Licenses (UASL), as well as the 3G licenses which have been granted to 4 companies. To further increase competition a fifth Mobile License (with GSM spectrum) was awarded to Emerging Market Telecommunications Services Limited, early 2008.Through the award of these licenses the Commission has facilitated the phenomenal expansion of telephone lines in Nigeria.

Revenue Generation to Government
Thanks to the licensing of these operators and the ensuing growth of the telecommunications sector, the Federal Government between 2001 and 2008 has earned over $2.5 Billion US Dollarsfrom spectrum licensing fees alone. Import duties and taxes from the telecommunications industry have also contributed substantial revenue to the Federal Government.

As recorded by GSMA, Nigeria is now amongst the top 10 growth countries for GSM in the world:
In order to facilitate the penetration of internet services the Commission has licensed several Internet Service Providers and has further encouraged the spread of internet access by initiating a class licensing regime to simplify authorization processes for the rollout of cybercafes and tele_centers.

SERVICE CATEGORY 1999 2000 2001 2002 2003 2004 2005 2006
2007
National Carriers* 1 1 1 2 2 2 2 2 2
Fixed Telephony 9 16 16 17 20 22 26 26 25
Unified License* N/A N/A N/A N/A N/A N/A N/A N/A 13
VSAT Networks N/A N/A N/A N/A 51 52 59 59 59
Internet Services 18 30 30 35 35 36 69 117 117
Table 3: ACTIVE LICENSED OPERATORS AND SERVICE PROVIDERS (1999_2007)
Catalyzing the Telecom Revolution Through Adequate Sector Regulation
Before the licensing of the Digital Mobile Operators in 2001, private investment in the telecommunications sector in Nigeria stood at about $US50 million. Between 2001 and now, the sector has attracted over $US12 billion most of which has been foreign direct investment (FDI). With ongoing strategic expansion plans being developed and carried out by many of the major service providers, another $US3 billion in direct investment is expected to have been invested into the sector in the year to the end of the 2008.

These high investment levels have been attained because Nigeria has become one of the most desired investment destinations for ICT in Africa due to the potential of the market and a stable policy and regulatory regime.

The Regulator, in an open liberalized market draws its relevance from the widely accepted role of the State as a motivator and impartial umpire. This role is typically very demanding and encompasses far_reaching and multi_disciplinary issues. To be successful, the function should be based upon a well defined set of objectives. These objectives must cover virtually every aspect of telecommunications network and service provision including tariff, technical standards, allocation of scarce resources, fair competition, and the regulation and mediation of inter_operator issues such as interconnectivity and interconnect termination rates. Indeed, a good regulatory environment can contribute to attracting investment by providing stable, transparent and non_discriminatory access to telecommunications resources.

The concept of having an independent Regulator for a nation's telecommunications industry only got worldwide acceptance in the last decade of the 20th century following the global and rapid privatization of several state owned monopolies and the liberalization of the telecommunications sector in several countries. By the development of sensible, transparent and investor_friendly legal and regulatory framework, serious investors would be encouraged to participate in a host nation's telecommunications market.

For sectoral liberalization to achieve the desired goal of Government and to meet the needs of the populace, the regulatory oversight function must be carried out through an independent Regulator, properly empowered to effectively carry out its assignment.

Regulator's Role
Typically the role of the Regulator is to encourage the growth of commercial enterprises and competition; prevent development of cartels and uncompetitive practices; remove barriers to market entry often experienced by new operators; and oversee the interconnection of new entrants with incumbent and dominant operators. The Regulator is also required to monitor tariffs and ensure that rates are financially and economically reasonable; make sure that service quality is of an acceptable standard; that customers are treated fairly and that operators extend their services to remote and rural areas.

Another key role of the Regulatory body is to see to the optimal use and equitable allocation of scarce resources such as the frequency spectrum, numbers and rights of way.

Key Success Factors for Regulation
(a) Enabling Laws
The foundation for a successful regulatory environment is the enabling laws, which must be such that the Regulatory body has the statutory powers to function effectively. Good regulation is essential to ensure the success of sector reforms.

(b) Government Support
The second important factor is the divestment of Government from ownership of telecommunications operating entities. Governments will be more inclined to introduce significant competition in the market and strengthen the regulatory institution if they do not also double as owners of telecommunications operators.

(c) Independence
Experience has shown that the independence of the Regulatory body is essential to the successful performance of its role in the sector. Regulators need to be isolated from political or administrative pressures to be able to regulate the market fairly and earn the confidence of investors, consumers and stakeholders.

(d) Manpower
The Regulatory body should be staffed with requisite trained professional personnel in the legal, technical, financial, economic and general management areas. The personnel should be adequately remunerated and be granted terms of employment which guarantee them minimum level of independence in the discharge of their functions.

(e) Funding
Without adequate funding a Regulatory body will not be effective. Some Regulators are funded from Government appropriations while others are funded by revenues from licenses and spectrum fees. The latter is generally preferred as it helps guarantee the independence of the Regulator and ensure that the regulatory function is not cash strapped, and therefore unable to carry out its mandated functions. Sadly, a number of National Regulatory Agencies (NRA) in Africa are starved of basic funds necessary for training, manpower development and operational effectiveness. In an environment characterized by operators with deep pockets, the NRAs' must be operationally and financially independent of network operators and service providers and must never depend on such entities for favors or handouts.

(f) Consultations
All sectoral stakeholders must be given the opportunity to comment or make their case concerning a major decision that impacts them before a decision is taken. When Nigeria decided to auction frequencies for the 2G Digital mobile services NCC started by publishing a Consultation document, both on the Commission's Website and in the print media, for the information and participation of all stakeholders. The comments received were taken into consideration in preparing the final bid documents. Of critical note is that unless perspectives of all interested parties are taken into consideration, Regulators risk making wrong decisions.

As already known by most Regulators, the bigger knowledge base is with the operators and other stakeholders in the field. Open consultations therefore are a major source of useful information for Regulators' decision marking. Regular consultations have always been an integral part of the regulatory processes at the NCC,

for rule making or decision making.
(g) Regulatory Decisions
In carrying out regulatory decisions, the key regulatory principles to be adopted are transparency, objectivity, professionalism, efficiency and fairness. Once these principles have been applied, the Regulators must be bold to make timely decisions. Some Regulators in attempt to avoid offending anyone, delay decisions or create unworkable compromises. This can lead to retarding the development of the sector and any delays in the development of the telecommunications sector can be costly to the operator, the consumer or the nation.

(h) Licensing
Licensing criteria must be well articulated and publicly available, and the terms and conditions of individual licenses must be investor friendly and also ensure consumer rights. In addition, the licensing processes must be transparent and timely, and the prevention of anti_competitive conducts by dominant operators in crucial.

(i) Interconnection
The regulatory environment should be such that the NRA guarantees new entrants seamless interconnection with the incumbents and dominant operators. Technical standards and specifications, rates and quality must be on non_discriminatory basis, and interconnection must be assured on a timely, transparent and reasonable manner. Finally, the NRA must ensure that the interconnecting parties have access to quick and independent dispute resolution.

(j) Consumer Protection
It is essential that consumer's are effectively protected from any form of exploitative behaviour by the operating companies and service providers. The Regulatory agency must therefore ensure that subsisting legal and regulatory frameworks support the rights of the consumers. To that effect, NCC mandates operators to publish their Consumer Codes of Practice, which clearly state the rights of their consumers, the services being offered, the channels for lodging complaints etc. Operators are also required to provide telephone numbers through which consumer complaints can be lodged. Operators are also to establish consumer care centres where complaints can be addressed quickly, effectively and efficiently.

Drop In Cost Of Ownership And Tariff Rates
The opening up of the market to competition in all segments of the industry has resulted in major drop in prices for telecommunications services. Pre_2001, the cost of subscription to MTEL's analogue mobile services was over N60,000 per line. In 2001, the GSM subscription started with a price of twenty thousand Naira (N20,000) per line and today, this figure has fallen to almost zero. The tariff for calls on the GSM network was as high as fifty Naira (N50.00) per minute. Today, a call on a GSM network can be made for lower than twenty five Naira (N25.00) per minute (mobile to mobile).

Although it does not set retail prices, the Commission consistently monitors the prices at which the operators offer their services to the public. In the first instance, the Commission approves all tariffs as stated in the Nigerian Communications Act 2003, and thereafter, monitors their implementation.

The Commission however intervenes as necessary in determining interconnect rates for the industry. The combined effect of the two interconnect rate determinations made in 2004 and 2006 was a reduction of the mobile termination rate from about N30 to N18.00 per minute in 2003 and subsequently to N11.40 per minute in 2006. This has enabled the fixed operators reduce their retail tariffs for calls to mobile networks to as low as N20.00 per minute. The Commission will be initiating a process for reviewing the interconnect rates in the next few months in line with international best practice.

The Commission has continued to implement the policy of licensing competitive operators in all segments of the market. Today, the Nigerian ICT market remains the most competitive ICT market in Africa, with service providers competing fiercely for market share.

NCC and Consumer Protection
In line with the Regulatory responsibility for the protection of the consumers, NCC has been very active and innovative in its effort to inform, educate and protect the consumers of telecommunications services in Nigeria. It has been fully discharging of this mandate and empowering the consumer through the following initiatives:

(a) The Telecom Consumer Parliament (TCP)
This is a platform created by the Commission to bring together stakeholders in the industry (i.e. the Telecom Regulator, Operators and Consumers) to openly discuss problems affecting the consumers of telecommunications services. The program is usually recorded and broadcast on national television. This novel approach in dealing with consumer issues has been acknowledged by the International Telecommunications Union (ITU) as an innovative and effective mechanism for resolving the complaints of consumers. It is held every month across the six (6) geopolitical zones of the country.

(b) Consumer outreach program (COP)
In this forum, the Commission addresses specific consumer issues, provide vital information and education to the consumers, creates awareness of its services and the consumers' right to complaint, as well as bring operators face to face with consumers to deal with their needs, questions and concerns.

(c) Customer Care Centre
This centre is established within the Commission, and its job is to collate and respond promptly to consumer enquiries and complaints received through e_mails, formal letters, telephone, or in person. Consumers are encouraged to only approach the Commission only when the operators are unable or unwilling to.

solve their problems. Many consumers have had their complaints resolved through this medium.
(d) Collaboration with Consumer Advocacy Groups
The Commission is collaborating with several Consumer Advocacy Groups in Nigeria. It has also signed an MOU with the Consumer Protection Council (CPC) aimed at collaborating to further ensure protection of Consumers in relation to telecom service delivery.

Socio_Economic Impact of the Telecom Revolution
The Nigerian socio_economic landscape has been greatly transformed thanks to recent developments in the telecommunications sector. It has had positive impact on virtually all facets of life in the country - political, social and economic. Government's interface with the citizens is now faster, family contact is renewed across distant parts, and businesses thrive thanks to their ability to link their customers in new and innovative ways.

Ownership of phones now cuts across the various social classes, opening great opportunities for the e_health, e_education, e_security, e_commerce and e_banking, etc, in the country. The growth in the telecommunications sector has resulted in the creation of over 12,000 direct jobs in the telecommunications sector, and hundreds of thousands more are informally employed through the sector.

Today the telecom sector is a key contributor to Gross Domestic Products (GDP). The telecommunications sector has continued toactively contribute to the Gross Domestic Product (GDP) of Nigeria. The percentage share of GDP from telecommunications sector rose from 0.06 in 1999 to 2.39 in 2007 at 1990 basic prices.

Universal Service Provision Fund
The 2003 NCA Act established the Universal Service Provision Fund (USPF), with the principal objective being the provision of subsidy to fund service delivery in high cost areas especially the rural and under_served parts of the country. The USPF Board was inaugurated in July 2006. In order to ensure the spread of telecommunications services to meet the needs of millions of Nigerians without ICT access, the Commission through the USPF is working to extend services to rural/underserved/unserved areas. Some of the ongoing USPF initiatives include:

(a) Community Communications Center (CCC)
The project is aimed at establishing Community Communications Centers that will extend voice, internet, ICT training and other services to unserved communities on shared basis. Each center is designed to provide a public calling center, cybercafe and ICT training courses, as well as serve as a platform from which to wirelessly extend Internet access to surrounding communities.

(b) Schools Access Programme (SAP)
The SAP project is designed to provide broadband internet connectivity to schools, universities and neighbouring communities with particular focus on the rural areas.

(c) Rural Broadband Internet (RUBI) Access
The program awards subsidies to successful proponents to provide wholesale Internet access to Community Communication Centers (CCC), cybercafes, Rural Internet Service Providers (RISE), Institutions, etc, in rural communities in Nigeria.

(d) Accelerated Mobile Phone Expansion (AMPE) Project
The Accelerated Mobile Phone Expansion (AMPE) Project is designed to encourage network roll out in at least 5 unserved towns/villages in each of the 774 Local Government Areas (LGA). The Fund awards subsidies to Network operators to encourage service rollout in remote and unserved areas of the nation

(e) Backbone Transmission Infrastructures
It was identified that one of the issues limiting the roll out of networks to certain rural communities has been the lack of backbone infrastructure near enough to make connectivity to the national network cost effective. The project aims to extend backbone transmission infrastructure to such remote locations and facilitate the rollout of voice and data access points there.

The Digital Bridge Institute (DBI)
The growth in the number of skilled manpower required for the telecom industry in Nigeria since year 2001 has been enormous. The Commission as an effective Regulator was committed to ensuring that the dearth of skilled Nigerians to run the fast expanding telecom industry in the country was remedied. A milestone was achieved on May 20, 2004 when the President, commissioned the ultra modern Digital Bridge Institute (DBI) in Utako, Abuja, established by the NCC as an international Centre for Advanced Communications studies.

Its primary aim is to ensure that some of the technical manpower requirements for the ICT industry are met with adequately trained and skilled personnel that can be recruited into the fast growing ICT market in Nigeria. The DBI also carries out training in other specialist areas such as economic analysis, financial planning, law, arbitration, mediation, interconnection, e_commerce, business management, human resource management andconsultancy services.

The Government Telecommunications Training Schools in Kano and Oshodi have recently been transferred to the Commission by the Federal Government and are currently being resuscitated to become campuses of the DBI. It is planned that from next year the expanded DBI will be providing various training programs for hundreds of graduates annually, to service both local and international ICT markets.

Digital Awareness Program (DAP)
As its contribution to the development ICT knowledge amongst young Nigerians, the NCC started the DAP project, which is aimed at encouraging the appreciation and use of ICT in primary, secondary and tertiary institutions all over the country. A total of 119 educational institutions have so far been provided with computers and internet facilities. At all the locations, the rooms housing the computer labs are refurbished and standby power supply provided.

Furthermore, in collaboration with the DBI, the Commission has provided ICT training for several hundreds of students from the schools that benefited from the DAP.

Realizing the need to train the lecturers in our tertiary institutions, another initiative, the Advanced Digital Appreciation (ADAPT) was introduced by the Commission and is aimed at bridging the identified ICT skills gap among lecturers in Nigerian universities, and equipping them to be able to use ICTs for their work, and as an aid for embracing web_based teaching and learning.

Institutional Strengthening of the NCC
When the new Board of the NCC was constituted and inaugurated in year 2000, the Commission's workforce was small and in no position to adequately discharge their statutory functions. Some one during those early days wrote that "NCC has one and a half engineers, a Commission Secretary and some protocol officers". The challenge of building a strong, professional and independent Regulatory agency was taken up by the Board. In the ensuing years, the Commission developed a full structure and, today, has all the professional skills necessary to function as the nation's telecommunications Regulator. It boasts an eminent list of 41 engineers and technologists and a good number of lawyers, economists and administrators.

To maintain and continuously improve on the skills base in the workforce, the Commission devotes a lot of resources to staff training and development. The Commission also places a lot of emphasis on staff welfare and the maintenance of a good working environment. This has contributed to earning NCC the reputation as an exemplary government agency and one of the foremost regulatory institutions in Africa.

From a cluster of three detached dwelling houses in Garki, Abuja, and the subsequent relocation to the more conducive building, Benue Plaza, in the Central Business District of Abuja, today, NCC has a permanent and very modern Head Office building in the Maitama district of Abuja. NCC has truly witnessed a structural and institutional transformation and continues to strive to maintain excellence in its corporate governance practices and regulatory interventions.

The NCC is widely acknowledged as a model telecommunications regulatory institution in Africa and in the past few years, has played host to various representatives from African telecommunications regulatory authorities on study tours.

It is the Commission's intention to continue to partner with the ITU and other development agencies in furthering the exchange of experience and expertise necessary for global best practices regulation in the region. NCC facilitated the establishment of the West African Telecommunications Assembly (WATRA) which it has continued to nurture and support, and is also very active within the African Telecom Union (ATU) and the ITU. With its current growth pattern and its position in Africa, Nigeria through the NCC, remains committed to facilitating the growth of the Nigeria's telecommunications sector, and taking its leadership position in telecommunications development in Africa.

Challenges
Though tremendous progress has been witnessed in the telecommunications sector, there nonetheless remain numerous challenges. A key challenge remains the issue of ensuring optimum quality of service (QoS) in the networks. However, the Commission is working assiduously to ensure that the quality of service continues to improve significantly within the shortest possible time. The major contributor to the current QoS challenges had been network capacity constraints as the network operators had not been able to expand their networks fast enough to meet the ever growing demand by subscribers.

To ease the congestion, the Commission barred promotional exercises by Operators, and directed Operators to cancel restrictions on validity of airtime credits which forced consumers to use up airtime credits faster.

Other factors that have caused the decline in QoS include the continued deterioration in the public power supply in recent times; security challenges; theft of Electric generating sets; transmission cable cuts; delay in securing approval for locations for the citing of new base stations, amongst others. The Commission is committed to achieving positive changes and has been working with operators to achieve network optimization and speed up the rate of deployment of new base stations, switches and transmission infrastructure.

Although the NCC rightly maintains that the responsibility to ensure good and acceptable quality of service rests with the Service Provider, the Commission has gone ahead and constituted an industry working group on Quality of Service.

The Future Outlook
At the rate of network growth it had been predicted that Nigeria would overtake South Africa to become nation with the largest number of connected lines in Africa. This prediction became reality in the first quarter of 2008.

However the nation's performance in the area of internet and broadband penetration remained low. Emphasis is therefore being placed on facilitating more rapid development of Nigeria's data capability by promoting large scale broadband internet deployment and aggressive optic fiber rollout across the country.

Some of the initiatives currently being employed by NCC to ensure further infrastructure development in the industry include:

(a) Wire Nigeria (WiN) Project
Rapid roll out of network resources such as base station and switches which should result in improved quality of service have been hindered by insufficient transmission infrastructure across Nigeria, with optic fiber and microwave transmission lines only available in limited number. The WiN project aims at ensuring that all the States of Nigeria are linked to the national optic fibre backbone infrastructure.

Therefore, the Commission in consultation with the operating companies is offering incentives that will encourage more rapid expansion of the transmission infrastructure through the development of fiber transmission cables. Since 2003 over 17,000km new optic fiber cables have been installed. There is another on going project which involves the installation of fiber cable over electric power lines. This has greatly increased the long distance transmission capacity available to support the fast network growth. The Commission expects that in thenext two years Nigeria will be fairly well served with transmission capacity to support anticipated large scale demand for broadband, voice and data services.

(b) State Accelerated Broadband Initiative (SABI)
There is already a growing broadband divide between Africa and the rest of the world with Nigeria recording very low internet and broadband penetration nationwide. There is therefore an urgent need to initiate policies that are aimed at promoting faster deployment of broadband in Nigeria. The SABI project is NCC's immediate response to this requirement and is designed to encourage the operating companies to build and run a broadband infrastructure with Government support and incentives in all state capitals, major commercial cities and subsequently all over the country.

(c) Connectivity across the West African Market
A vital area of infrastructure rollout that the Commission is focused on is on the communication links to other countries in the West African sub region. The WATRA constitution requires amongst others, the need for harmonization of regulations for telecom service delivery and pricing in the sub_region and the need to promote the establishment and operation of efficient, adequate, and cost effective telecommunications networks and services. This is vital to the economic development of the member states, and we must therefore put in place, such regional polices, that are aimed at eliminating regulatory barriers to regional integration and development.

Currently, ZAIN, MTN, Globacom and Direct_on_PC are also operating in other West African countries such as Chad, Niger, Senegal, Burkina Faso, Guinea Bissau, Guinea Republic, Liberia, Ghana and Togo, Ivory Coast etc. This geographical reach of the mobile operating companies is also facilitating business transactions across Nigeria and across the West Africa sub region. Nigeria, with its population and market potential is at the centre of it all, and is fast assuming the status of an ICT sub_regional hub for West Africa.

The Commission is working with WATRA to ensure that communications across national geographical boundaries are greatly enhanced through substantially harmonized legal and regulatory policies; the adoption of common spectrum policies; common technical standards and type approval policies; substantially common license framework; common interconnect and tariff issues; and common dispute resolution process and procedure.

The NCC believes that now is the time for the barriers to be eliminated. If the WATRA mandate is fully implemented, the West African sub region will witness a common market for telecommunications with more operators operating across the sub_region, increasing competition, providing more choice for the consumer and reducing the cost of services.

Wanted: A Power Revolution
With the present state of electricity supply in the country, the digital revolution in Nigeria cannot attain its full potential. Growth of subscriber lines should also go side by side with improvement in the public electricity power supply situation in the country. It is the wireless deployment that has contributed to over 99% of the new subscribers added to the telecommunications network since 2001. However, unlike fixed wire_line line systems, wireless systems require electricity to power the terminal equipment, and to work efficiently.

Computers, DSL connectors, table top units, mobile phone sets, base stations/cell sites, switching centers, microwave transmission stations and all the other ICT equipment, infrastructure, systems and terminals must have good power supply to work well. Unless this vital source of energy is always available and reliable, the Nigerian people may not be able to fully enjoy the benefits that the digital revolution

offers especially in the remote and rural areas of the country.
Conclusion
Today, the Nigerian telecommunications industry is very different from what it was just a few years ago up to year 2000. The nation over the period from 2001 to date has recorded massive nationwide deployment of communications infrastructure, availability of a wide choice of communications services, growth in the teledensity figures, and improved technological know_how and expertise of the Nigerian workforce. Increased competition in the market has also resulted in cheaper and more affordable services for the consumers.

Today, to get connected to a mobile service is virtually free.
The sector is a major employer of labour with tens of thousands of Nigerians directly employed by the Telecom operators, and several hundreds of thousands of others also benefiting from indirect employment generated by the operators. Some of those beneficiaries of the growth in the sector include contractors to equipment suppliers, construction firms, research companies, advert agencies, media consultants, etc. In the financial sector, enterprising banks have designed innovative products that leverage the use of mobile phones.

The emergence of the large number of telecommunications companies has also led to the return of significant numbers of Nigerians from the Diaspora. These professionals, with the requisite international experience have been attracted back home and form an invaluable addition to the industry's growing pool of skilled human capital.

Doing its part, the Nigerian Government has also provided the right enabling environment to attract serious investors and encourage market forces to thrive. The various Government initiatives and policies being implemented were carefully designed and aimed at attracting investment, accelerating network expansion, introducing new technologies, improving pricing and enhancing choice and quality of service.

Nigeria is set to leapfrog into the circle of the world's information_rich economies. As the nation's Regulatory authority, the NCC is determined to see that universal access is attained so that all Nigerians, not just those in major cities and urban areas, enjoy the full benefits of the Information age with the attendant positive socio_economic gains. The Commission in line with its vision and in the fulfillment of its mandate is committed to the attainment of a robust, efficient, ubiquitous and high quality national network that will provide modern, affordable, widely available ICT services to the citizens of Nigeria.

From the telecommunications backwaters, Nigeria is today a veritable role model within Africa, with the impressive growth recorded in the telecommunications industry since 2001. But the Commission will not rest on its laurels, but will continue to work towards the development of world class telecommunications industry for Nigeria.

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