Anxiety over N75b 5G spectrum reserved price, license tenure

Telecommunications operators are worried about the reserved price of N75 billion (about $197. 4 million) as a starting point for the 5G license billed to take place on December 13, 2021.

Besides, the operators are also worried that the 10-year tenure placed on the license is too small; rather, they want a 20-year period as tenure.

In both cases, the Nigerian Communications Commission (NCC) said it will go ahead with its plans as it is working in line with global best practices. It, however, noted that some other issues that require a review would be looked into adequately.

These formed part of the deliberations, at yesterday’s Stakeholders Consultative Forum on the Draft Information Memorandum for the 3.5GHz Spectrum Auction for the planned 5G network deployment in Nigeria, organised by NCC.

Already, the Commission has scheduled December 10 for the mock auction, while the actual auction is fixed for December 13, 2021. Interested operators are expected to pay 10 per cent of the reserved price of $197.4 million to qualify to participate in the auction.

Chairman of the Association of Licensed Telecoms Operators of Nigeria (ALTON), Gbenga Adebayo, said as a sector, they are concern about the cost of the 5G license.

Adebayo said though the industry was committed to supporting the NCC to achieve its goals, the operators would have wanted a cheaper spectrum cost.

“So, in order not to launch what will not be efficiently driven, we need to look at the cost,” he stated. Though Adebayo spoke for all the telcos, individual companies that sent their queries to the NCC on the high price of the license fee and other issues, urged the Commission to look into the matter amicably.

For instance, MTN, Airtel, including the Global System for Mobile telecommunications Association (GSMA) wanted the fees reviewed.
MTN posited that the reserved price is 136 per cent higher than the market value. It recommended that the price should be reviewed downward to about $50 million to ensure full participation of more players.

The telecommunications firm also pointed out that instead of the 10-year tenure on the license, it should be extended to 20 years to guarantee full infrastructure support.

Airtel, in its submission, wanted the reserved price reduced to reflect the economic situation in the country. It also claimed that the two slots of 100MHz to be auctioned should be increased to ensure more participation.

GSMA also toed the line of other operators, stressing that NCC should make all slots in 3.5GHz available.

The telecoms association argued that the longer the tenure of license, the better the roll out of infrastructure by operators, hence the reserved price doesn’t reflect the principle contained in the New National Broadband Plan.

It should be recalled that the reserved price for the GSM auction in 2001 was put at $100million. Operators ended up paying $285 million at the end of the auction that took place in January of that year.

Earlier in his welcome address, the Executive Vice Chairman, NCC, Prof. Umar Danbatta, said among the mandates of the 5G Policy is the collaboration with relevant stakeholders and provision of the required spectrum and enabling environment to ensure full deployment of 5G.

He said the 5G will harness the social and economic benefits that come along with it, and will serve as a catalyst for the successful implementation of our National Digital Economy Development and Strategy (NDEPS) for a Digital Nigeria.