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Telecoms license structure comes under scrutiny

By Adeyemi Adepetun
23 June 2021   |   4:20 am
Technology is changing so fast that no one may be capable of giving a one hundred per cent detail of what is happening at any given time.

Telecoms<br />

ADEYEMI ADEPETUN writes that the planned review of telecoms license structure in Nigeria is expected to throw up more issues, among which is convergence. Largely, it is expected this should make the country improve its competitiveness.

Technology is changing so fast that no one may be capable of giving a one hundred per cent detail of what is happening at any given time.
From 1G to 2G, then 3G, later 4G, and now 5G. Some countries including Japan and China are already making advances at 6G. On the enterprise level, technologies have moved towards Internet of Things (IoT), Machine Learning, Artificial Intelligence, Robotic Process Automation (RPA); Edge and Quantum Computing; Virtual and Augmented Reality, Blockchain, Fourth Industrial Revolution (4IR), among others. Indeed, technology is moving at the speed of light.
Today, it is instructive to say that people and indeed countries that are not advancing technologies are primed to be left behind.
Earlier in the month, at the heat of the Federal Government and Twitter spat, the former directed the National Broadcasting Commission (NBC) to kick-start the process of licensing Over The Top (OTT) service providers in the country. This decision did not sit well with telecommunications operators, which believed that such regulation should be under the purview of the Nigerian Communications Commission (NCC).

As such, in demonstration of its responsiveness to global trends and the dynamics in the information and communications technology ecosystem, the NCC initiated the process for the review of existing licensing structure in the Nigerian telecommunications industry.
The Executive Vice Chairman and Chief Executive Officer of NCC, Prof. Umar Garba Danbatta inaugurated an in-house Standing Committee to carry out the task.
Danbatta, while inaugurating the Committee, said the need for the review of the existing license structure was informed by the wide range of technological advances, convergence of technologies and services which have characterised the global telecoms space over the years, and whose impact is increasingly being experienced in Nigeria.
According to him, the current license structure is almost 20 years old, hence the need for an urgent review of the existing license pattern to reflect new licensing trends in line with international standards while providing opportunities for improved revenue for the government.
“Therefore, it is evidently clear that this Standing Committee, drawn up from competent hands in various departments of the Commission, is perfectly suited and capable of addressing the enormous task of reviewing the existing license structure of telecom licensees in Nigeria,” he said.

Task before Committee
WHILE noting that the work of the Standing Committee will be carried out in phases, Danbatta said effective delivery of the Committee’s task will help the commission to institute a process, which will culminate in the review of the terms and conditions of the various license categories. These, he said, will include licensing fee, as well as identification of the limitations of the various license categories, with a view to clearly determining licenses that should be phased out or amended.
Specifically, Danbatta outlined management’s seven-point deliverables from the committee to include a comprehensive review/report on existing licenses; report and recommendations on consultative fora; and report on recommended new license undertakings.
Others include a report on recommended amendment to license fees and durations; a report on benchmarking of license with similar jurisdictions, a report on the impact of certain licenses on other license holders. The Committee is also expected to recommend solutions as well as develop an updated regulatory framework for new and amended licenses as the case may be; and a final report on the project with all recommendations.
Also speaking during the inauguration of the Committee, the Director, Licensing and Authorisation, NCC and Chairman of the Committee, Mohammad Babajika, assured the Commission’s management of the Committee’s resolve to deliver on the terms of their assignment.
At the end of the Committee’s assignment, and following due consultations with industry stakeholders, the Commission envisages a new draft framework for new and amended licenses.

Licensing Regime
The nature of licenses granted by the NCC is personal to the licensee, such that a licensee is not permitted to operate, assign, sub-license or transfer their license to any other party without obtaining a prior written approval from the NCC. There are two major classifications of licenses under the NCA. These are Individual License and Class License. Findings from showed that an Individual license is a category of license, which terms, conditions and obligations, scope and limitations are limited to the service being provided. In Nigeria, Individual Licenses are granted for the following services: Internet Services, Non-Commercial Closed User Group, Sales and Installation, Unified Access Service License, International Data Access, International Gateway, Interconnect Exchange, Metropolitan (Fibre) Cable Network, Mobile Number Portability, National Carrier, National Long Distance Communications, among others.
On the other hand, a Class License is a broader category of license, in which terms, conditions and obligations under the license are common to all license holders. The NCC usually grants a Class License in respect of any matter requiring a Class License under the NCA. In Nigeria, Class Licenses are issued for: Sales & Installations, Repairs & Maintenance of Telecoms Facilities, Cabling Services, Telecentre/Cyber Café and Public Payphone Services.

Industry Expectations
Speaking on the issue, the Nigeria Coordinator, Alliance for Affordable Internet (A4AI), Olusola Teniola, said the license structure of the industry is very relevant to the infrastructure required to build from the ground up, the basic elements of a carrier grade voice network, which has also provided a platform for data services and access to the Internet where the country now have broadband deployed across it.
He however, said it is noteworthy that the licensing regime then, did not take into consideration the fast and evolving nature of Internet Protocols (IP) and the advent of the convergence of voice, broadcasting and multimedia technologies under the same technological building blocks.
Teniola said for NCC to remain relevant, its regulatory tools need to be updated and brought in line with advances made in the digital realm.
According to him, the areas that will need to be keenly looked into are: impact on current licensees, impact on legacy investments and costs that FG is seeking to introduce in an environment like Nigeria, where digital divide exists.
Teniola said the Nigerian National Broadband Plan 2020-25 recommends that spectrum prices should be reviewed to allow for wider affordability of services deliveries, which is certainly an area that should be of focus.
He stressed also that 5G and 6G will bring with it tremendous opportunities to leap-frog the classical supplementary services that have been widely adopted and used in more advanced jurisdictions.

According to him, in the case of Africa and in particular Nigeria, it is well recognised the National Regulatory Authorities may have to develop regulation that aligns complex data streams alongside ‘voice’ that will be viewed as just another data application as opposed to what it was in the past.
Teniola, a former President of the Association Telecommunications Companies of Nigeria (ATCON), said in order to ensure ubiquitous broadband and relevant Use Cases, NCC would need to introduce innovative regulation in line with the Nigerian Digital Economy Policy and Strategy 2020-2030 aspirations.
The A4AI chief said this may give the much-needed impetus for further innovation targeted at moving the industry beyond the services of just connectivity and address meaningful connectivity that would lay a foundation for the 4th Industrial Revolution (4IR). Teniola said the structure should also embrace the country’s Cybercrime Policy and Strategy 2021.
He stressed that Quality of Service should also embrace Customer Experience and “hence the regulatory tools should focus on broadband speeds and the outcomes over and beyond what is obtainable by consumers right now.”
On his part, the Chairman, Association of Licensed Telecoms Companies of Nigeria (ALTON), Gbenga Adebayo, welcomed the plan, urging efficient spectrum use.
Adebayo said operators have made comments and prayers to the NCC through the appropriate quarters and are quite positive that the commission will consider them.
“We appreciate the continuous need for efficient spectrum utilisation and we are positive that the NCC and other responsible spectrum management authorities will continue to do the needful required from time to time.”