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Telecoms sector awaits dividend of frequency allocation

By on April 28, 2015

With the current efforts aimed at deepening provision of broadband Internet services in the country, the Nigerian Communications Commission says it is awaiting the release of digital spectrum licence to add to the list of spectrums resources already pencilled in for auctioning to boost broadband provision.

The Digital Dividend Spectrum is the frequency band located with 70megahertz, which has been internationally adjudged to be very useful in deploying high-speed Internet services in the country.

The 700 spectrum band was approved by the International Telecommunications Union, global telecoms regulation arm of the United Nations, for mobile broadband deployment about three years ago.

In Nigeria and just as it is the case in other countries around the world, these spectrum bands, which have been held by the broadcast industry, are supposed to be taken from broadcast media, which are due to migrate from analogue to digital transmission, using a lower frequency band.

But currently, a dominant cloud of uncertainty still pervades the air on the ability of most broadcasting stations in Nigeria to migrate as of the June 2015 deadline set by ITU for all broadcasting stations across the globe to have migrated from their analogue broadcasting frequency to digital platforms.

“As of today, none of these frequencies has been released despite the fact that we are on the eve of migration to digital broadcasting. Besides, we are not sure yet whether any of these broadcast media is ready for digital transmission,” an official source at the Nigerian Communications Commission said.

However, the source explained that with the current efforts by the country to increase broadband penetration from its current eight per cent to 30 per cent by 2018, in line with the Federal Government’s target as contained in the National Broadband Plan, it would require that there was adequate spectrum to deploy broadband services including the Long Term Evolution.

Already, stakeholders are waiting patiently for the digital dividend to be released by the necessary authority since frequency allocation in Nigeria has processes.

For instance, if the 700 Mhz frequencies are taken over from the broadcast media by the National Broadcasting Commission, they are handed over to the National Frequency Management Commission, which is the custodian of all frequencies in Nigeria under the Ministry of Communications Technology.

The NFMC then decides what slots it gives out to the NCC for allocation accordingly with appropriate guidelines according to global best practices, especially as stipulated by the ITU.

As such, the 700 Mhz band, indeed, will allow LTE mobile broadband services to be provided by the telecoms players.

According to the President, Association of Telecoms Companies of Nigeria, Mr. Lanre Ajayi, it will be an advantage for the country, “if these spectrum bands are released by the appropriate authority for NCC to allocate to would-be applicants.”

In other words, the Digital Dividends are not yet available, and so NCC cannot assign what it does not have, though, in its usually proactive manner, NCC had started consulting with the stakeholders on the best way to allocate the spectrum bands ahead of the expected release of the spectrum from broadcast industry to the NFMC.

Meanwhile, the Federal Government has declared year 2015 as the broadband year and for mobile operators, the most technically advanced technology for broadband offering is the LTE.

Our correspondent learnt that this was a development that had necessitated the current race by the NCC to acquire the necessary, but scarce spectrum such as the 700Mhz to enable operators to roll out LTE services and offer mobile broadband.

Technically, LTE is a wireless broadband technology designed to support roaming Internet access via cell phones and handheld devices. Because LTE offers significant improvements over older cellular communication standards, some refer to it as a 4G (fourth generation) technology along with WiMax.

The LTE can theoretically support downloads at 300 megabites per second (Mbps) or more based on experimental trials. However, the actual network bandwidth available to an individual LTE subscriber sharing the service provider’s network with other customers is significantly less.

The LTE service is only available in limited geographic areas, but telecommunications providers have been actively expanding their LTE services and the release of the digital dividend spectrum will go a long way in putting Nigeria on the map of countries, where LTE services are currently being deployed.

LTE is the global standard for the fourth generation of mobile networks (4G) supported by all major players in the industry. It offers the capacity and the speed to handle a rapid increase in data traffic.

According to latest Ericsson Mobility Report, there will be 9.3 billion mobile subscriptions in 2019 while also predicting that 65 per cent of the world’s population will have LTE coverage by that same year.

Also, as of March 2014, a GSMA report indicated that there were 279 commercially-launched LTE networks in 101 countries and 482 LTE network commitments in 147 countries.

Generally, LTE offers superior performance and capacity; simplicity in deployment; appreciable latency as well as compatible with a wide range of terminal devices.

For telecoms end users, LTE services will give them a superior user experience when it comes to stability, throughput, and latency. The increased capacity will bring new and better services to users.

Also, for telecoms operators, LTE offers existing and Greenfield operators the advantage of a future proof network delivering capacity, throughput and user experience creating new business opportunities and revenues. LTE offers low long-term capital and operational costs. Networks deployed today can be used for all generations of communication; 2G, 3G and 4G.

“The introduction of LTE is an evolutionary step, rather than revolutionary, as large parts of existing infrastructure are re-used providing a future-proof technology path for flexible migration of services between 2G, 3G and 4G mobile technologies. But in order to meet customer expectations and demands for capacity and speed tomorrow, all major players need to put an LTE strategy in place today,” a telecoms analyst, Mr. Akin Akinbo, said.

Indeed, deploying telecoms services through wireless means requires the provision of adequate spectrum to telecoms operators for service deployment and this has informed the effort by the regulator to ensure it sources for adequate spectrum to be licensed to telecoms players.

Meanwhile, in addition to the efforts being made to ensure the availability of 700Mhz , the NCC on March 12, 2015 convened a stakeholders’ consultative forum on the 70/80 Mhz band, in Lagos.

For now, the commission is already putting things in place in line with the inputs of stakeholders and industry players while working to fine-tune the document and release the rules for the bidding process “very soon.”

Earlier, in February 2014, the regulator auctioned the 2.3 Ghz spectrum band to a national player, which will commence commercial service any moment from now, as part of the regulator’s move to make adequate spectrum available for broadband services, in a country where more than 90 per cent of telecoms services are deployed through wireless means.

While it is also true that the proposed 2.6 gigahertz spectrum auction band had experienced two postponements, a top official at the Ministry of Communication Technology, who craved anonymity, explained the reason for the postponements.

The ministry source said, “The NCC wants to get it right. Recall that in 2001 after the Digital Mobile Licence auction, Communication Investment Limited, one of the winners, did not pay for the licence because the frequency allocated to CIL was believed to be encumbered and it lost the licence and the deposit for it.

“So, the NCC wants to clear any foreseeable cobwebs before such a major licence round like the 2.6Ghz.Indeed, this licensing round is work in progress.”

Also, the Infrastructure Companies (Infracos) licences have begun, as Lagos and North Central including Abuja licensing was already done.

The other five zones, according to the NCC, are works in progress, as government, through the NCC, is dangling incentives to attract bidders to zones which are believed to be less attractive commercially. This is to ensure broadband services are rolled out across all geopolitical zones in the country.

Besides, the Ministry of Communications Technology had said that tax holidays of between five and seven years, about 30 per cent for capital expenditure was also in the offing.

In addition, the 5.4 gigahertz across the 36 states of the federation has already been advertised and applications are already being received at the commission.