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By Chinenye Anuforo, [email protected]
Following approval of the National Policy on Fifth Generation (5G) technology deployment in Nigeria by the Federal Executive Council (FEC) recently, the Minister of Communications and Digital Economy, Isa Ali Ibrahim Pantami, urged the Nigerian Communications Commission (NCC) to prepare for immediate and effective implementation of the policy.
This means that, by January 2022, Nigeria is expected to join other nations that have deployed the Fifth Generation (5G) networks on a commercial basis.
The 5G network is an advanced form of 1G, 2G, 3G and 4G. Nigeria currently operates the last three.
5G enables a new kind of network that is designed to connect virtually everyone and everything together including machines, objects, and devices.
5G wireless technology is meant to deliver higher multi-Gbps peak data speeds, ultra low latency, more reliability, massive network capacity, increased availability, and a more uniform user experience to more users. Higher performance and improved efficiency empower new user experiences and connects new industries.
Through a landmark 5G Economy study, it was revealed that 5G’s full economic effect will likely be realized across the globe by 2035—supporting a wide range of industries and potentially enabling up to $13.1 trillion worth of goods and services.
This impact is much greater than previous network generations. The development requirements of the new 5G network are also expanding beyond the traditional mobile networking players to industries such as the automotive industry.
The study also revealed that the 5G value chain (including OEMs, operators, content creators, app developers, and consumers) could alone support up to 22.8 million jobs.
And there are many emerging and new applications that will still be defined in the future. Only time will tell what the full “5G effect” on the economy is going to be.
With so many identified benefits of 5G and having conducted a successful trial of the fifth generation network with the biggest telecoms provider, MTN Nigeria, the Federal Government through the Ministry of Communications and Digital Economy has been making significant efforts to ensure Nigeria join a host of other countries to start deployment of 5G network early next year.
NCC’s readiness
The Executive Vice Chairman, NCC, Umar Garba Danbatta, stated the Commission is ready for the implementation of the government’s decision on 5G.
“Already, we are set for the auction of some spectrum slots in 3.5GHz band. The other day I was at the National assembly, I informed the senate that we were 95 per cent ready for 5G. Today, as we speak, I am delighted to tell you that we are already at 97 per cent completion,” Danbatta told stakeholders at a forum.
“The Committee set up to auction the Spectrum has already developed an Information Memorandum (IM) which is already published for inputs and comments from all industry stakeholders. Prior to this, a 5G deployment plan was developed and we have since secured Federal Government’s approval,” he said.
To emphasise the NCC’s readiness, the Commission also last week disclosed it has fixed the reserve price for the 3.5GHz (5G) spectrum auction at $197.4 million and the auction for 5G services will hold December 13, 2021.
The Director of Spectrum, NCC, Oluwatoyin Asaju disclosed this at stakeholders consultative Forum on the Draft Information Memorandum (IM) for the 3.5GHz Spectrum Auction organised by the NCC in collaboration with the Ministry of Communications and Digital Economy in Lagos on Thursday.
A reserve price is a minimum amount that a seller will accept as the winning bid. In bidding process, it prevents a bidder who offers a price lower than what the owner will accept from winning the auction
Asaju said the commission would first hold a mock auction on December 10, 2021.
“A reserve price of approximately N75 billion (Seventy-Five Billion) Naira only, equivalent to One Hundred and Ninety-Seven Million and Four Hundred Thousand United States Dollars only (USS 197,400,000.00) is to be used,” Asaju said.
“An Initial Bid Deposit (IBD) equal to 10% of the reserve price is adopted in line with the previous auction.”
He said the ascending clock auction process will be used.
“The auction will be software-based, adding that provisions have been made for the manual auction should the auction software fail during the auction process.”
On eligibility criteria for network operators, Asaju said only licensees with 100 percent regulatory compliance would be allowed to participate in the auction.
“New entrants are allowed to participate in the auction in addition to existing licensees,” he added.
“Licensees with outstanding debts that have secured Management’s approval for a payment plan will be allowed to participate.”
Operators reactions
However, operators in the telecoms industry argued that the minimum price set for the planned 5G spectrum is too expensive and higher than what obtains in other other countries.
According to MTN and Airtel, the reserve price of about N75bn ($197.4m) is too high and above what obtains in other climes of the world.
In their comments, the GSMA (an umbrella body for all the operators in the sector) raised concerns over the spectrum price, saying it might affect the plan to achieve affordable Internet access for a large portion of the populace.
The GSMA added that a licence tenor of about 15 years should be considered if the spectrum price is to be sustained.
MTN had said the price should be reviewed to reflect market realities, while adding that the licence tenor should be put at 20 years as against the 10 years proposed by the NCC.
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.
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.
The Chairman of the Association of Telecommunications Companies of Nigeria (ATCON), Ikechukwu Nnamani, who admitted that Nigeria should not be left behind as far as emerging technologies are concerned, said reduced spectrum cost would help operators to deliver 5G service to subscribers at an affordable rate.
“There is no doubt that the operators are going to spend a lot of money to deploy 5G and they will need to recoup their investments from the service. The only way the cost can be lowered for the subscriber is for the telecoms regulator to make the 5G spectrum cost as low as possible,” he said.
On his on part, Okoh Aihe former Director, NCC stated that 5G technology can actually contribute immeasurably to rebuilding and re-calibrating the economy, thus actually making it possible for the new technology to explode growth in the economy through youth participation and other citizen mobilisation.
“Technology may actually provide the magic wand to perform the miracle which President Buhari spoke about in his independent day speech. Because, in truth, trying to pull a 100m out of poverty in less than two years is nothing but a miracle; it’s like trying to climb the walls of Burj Khalifa in Dubai without requisite skills.”
He stated that the Generic Reserve Price, of one hundred and ninety-seven million and four hundred thousand United States Dollars (US$197,400,000) is troubling. “For a country in visible economic trouble for which every naira and dollar counts, there shouldn’t be the impression that the focus of the auction is to raise money.”
However, emphasis should be on 5G rollout for development and not cash generation to feed a panting economy.
Stakeholders reactions
Expressing his concerns about the deployment of 5G in the country, Mr. Jide Awe an ICT expert explained that offering significant improvements over previous generations, the fifth generation (5G) of cellular technology can certainly not be ignored. “The 5G system meets the need of applications and experiences with heavy bandwidth requirements such as video streaming on-the-go and augmented reality and virtual reality applications.
Much of the attention on 5G comes from a realization that it will distinguish countries in the new digital economy. For Nigeria, leveraging on 5G can improve competitiveness and create immense possibilities in innovation and transformation, towards building a new digital economy. Although Nigeria still has serious challenges in telecom infrastructure provision, 5G offers huge potential for new unexplored growth areas.
The eventual full-scale rollout of 5G however demands huge investment to design and invest in this new infrastructure. It is therefore impossible to overemphasize the need to create an environment in the entire telecom space (5G and existing networks) that enables investment and deployment. Critical aspects such as access of providers to equipment, support of investment, partnerships and facilitating infrastructure rollout should be addressed. The recent draft Executive Order declaring telecommunications infrastructure ‘a critical national infrastructure’ is a welcome development.”
Awe said the essence of 5G adoption is to ensure the country is not left behind in the digital age.
The Chief Executive Officer, Internet Exchange Point of Nigeria (IXPN) and President, Nigeria Internet Registration Association (NiRA), Muhammed Rudman, said Nigeria needs to follow the global trend. He said even though some places in Nigeria currently have only 2G and 3G, there is need to follow global trends in order not to be left out. “Most areas don’t have the internet access to 4G. Even in Lagos, not all the areas have 4G network but the reality is, we need to follow the global trend because technology constantly evolves,” he said.
Rudman stated that because Nigeria did not succeed in the initial technology evolution doesn’t mean it shouldn’t try and catch up with the next wave.
