Operators face hurdle in network expansion plans

David Venn, chief executive officer, Spectranet, a 4G LTE internet service provider, has said that network congestion being experience by telecommunications subscribers will persist as operators are finding it difficult to carry out expansion of their network.

He told Nigeria CommunicationsWeek that operators are faced with a serious challenge of convincing shareholders to bring money to expand their network to offer subscribers quality service for both voice and data because of uncertainty in returns on investment.

“There won’t be improvement in the network quality service for now as operators could not convince their shareholders to invest in network capacity because there is no strong business case for such investment with the present data price.

“The present data floor in the industry encourages more people to use data service which is response for network congestion and revenue from the service does not encourage shareholders to bring money to expand capacity. Something has to change if we are to deliver quality service and what has to change is for Nigerian Communications Commission to revisit data floor,” he said.

Venn explained that the telecommunications landscape in the country is now changing from a voice centric to data centric source of revenue just as WhatsApp has almost eroded revenue that GSM operators are making from short message service (SMS).

“Operators need equipment to build towers. In the last one year it has been difficult for us to access dollar to import equipment for network expansion as well as adding capacity, the ones we are doing is from the equipment we imported before the new policy on FX, for big operators it has been very difficult for them to import equipment which has affected their efforts in adding capacity,” he said.

Engr. Gbenga Adebayo, chairman, Association of Licensed Telecommunications Operators of Nigeria (ALTON), called on NCC to revisit the data floor price determination in order to save and encourage small operators in the sector.

“Data floor price determination is meant for small operators not for big operators who will still survive with the present situation. We are trying to avoid a situation where CDMA operators died because of price war. If data price is determined, it will encourage small operators in the sector. We need to look at it beyond public sentiment and emotions around it and revisit the issue for the growth of the industry,” he said.

Olusola Teniola, president, Association of Telecommunications Companies of Nigeria (ATCON) added that the industry regulator needs to revisit the data price floor to determine the appropriate data pricing to ensure that investors have certainty in government policies in order for them to bring capital that will be used for infrastructure deployment required for broadband.

“This is important in view of 30 percent broadband target by end of 2018 which we have just over one year to achieve. It is important that the industry sees government policies as one that creates an enabling environment for businesses to thrive so that investors can bring funds to invest for the development of the sector.”