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'SLOW
BUT A STEADY SCALING OF NEW HEIGHTS'
: 2009 IN RETROSPECT
(A review of the telecom industry in 2009)
by
The CyberschuulNews.com Team
Telecommunications and banking in any economy can be likened to
Siamese twins. This is because there is
a symbiotic, interdependent and
self-reinforcing relationship between
both sectors as they individually and
jointly stimulate as well drive the
economy. So when global telecom players
tried to convince us of their immunity,
given what we knew was going on in the
economy, we did not believe them. Events
somewhat justified our scepticism.
At home and abroad as we proceeded into the year 2009, we began to
understand the chicanery that brought us
to within a whisker of complete
collapse. As businesses went to the wall
and repossessions increased, bankers and
banking became unpleasant euphemisms
with some chief executives put on 24hr
watch and police surveillance, some got
arrested and a few got sent down. Abroad
Ponzi schemes and all manner of fraud
and deception that hitherto hidden in
file cabinets were flushed out, vital
evidence saved from shredders and
massive irregularities revealed.
Financial institutions were summarily
stripped of the “reputable” adjective.
At home Nigeria was not without its own
thrilling episodes.
But in the Telecom/InfoTech industry, the story was somewhat
different. In both the Nigerian
experience and from a universal
perspective, 2009 was a mixed bag of the
good, the bad and sometimes the
downright ugly.
The year started with a new Minister of Communications, Prof Dora
Akunyili who was appointed in the dying
days of 2008. She resumed at the Radio
House with the vigour and reputation of
an accomplished professional and fighter
having taken on the scourge of fake
drugs and its miners with considerable
success. She took her office
battle-ready to take on the mantra of
being government’s mouthpiece, which
essentially is the job of the Minister
of Information and communications. In an
Iron Lady-like fashion, she hand bagged
virtually anything in sight and around -
telephone tariff, transparency,
‘re-branding’, ‘hijackers? not us' etc that by the
year end yesterday, observers conceded
it had been a slow but eventful year for
the telecom industry. She saw current
telephone tariff as unacceptable and bore
down on it with vengeance attempting to
force it down with mere wishful thinking, emotion and
bold face .
Unfortunately, it did not quite work.
On balance the industry recorded a few isolated wins in these
bruising encounters, but it was
simultaneously forced to slow down its
pace to synchronize with the speed of
overall leadership.
The Rural Telephony Project
The Minister resumed meeting the controversial rural telephone
project, a Chinese initiative for
Nigeria, into which $200m had been sunk
with no discernible output. She read out
a list of six telephone ‘operators’
(more like licensees who have not
invoked their licenses) who offered to
buy over the failed project. January
2010 will mark the first anniversary of
the handover. Hopefully Ministry
officials will give a progress report.
Compulsory NEFT
Banks and financial institutions still maintained their lead in
applying e-processes as they introduced
a range of financial products for which
telecom played key role just as mobile
operators also deployed banks’ automatic
teller machines as platform for
delivering their primary services.
Federal government insisted, for the first time, that all of its
disbursement henceforth would be by bank
transaction thus giving the National
Electronic Funds Transfer (NEFT) its
literal meaning in running government
business. Although government has given
it the “e-payment” nomenclature, it may
well have to move full steam ahead in
2010 to implement other related
electronic technology inspired
facilities to turn what is essentially
an e-aspiration into an e-reality. Can
there be a true ‘e’ without broadband
internet access?
Broadband hopes
A sizeable number of fibre projects which may turn around Africa’s
low internet penetration moved closer to
reality during the year. MainOne Cable
Company concluded the shore-end laying
of its undersea fibre optic cables in
Lagos marking a critical intermediary
stage of installation on the shores of
countries where the cable system was
expected to berth its origins in
Portugal. Ditto for Globacom, both
promising good and cheap access in the
New Year. Elsewhere on the continent,
SEACOM announced the New Transatlantic
submarine fibre-optic project designed
to encircle the African continent,
connecting its coastal and hinterland
countries as well as islands reached a
remarkable milestone with the completion
and commissioning of the phase which
links South and East Africa to global
networks via India and Europe.
All represented significant progress for Internet development in
Africa.
ITU Secretary General, Hamadoun Toure,
applauded the progress made in the
continent when he said in Abuja that the
continent has given a good account of
itself. He craftily deprecated President
Yar' Adua’s prediction that Nigeria
would attain 100 million telephone lines
by the year 2020 as lacking in ambition
since current trends show that the
President’s prophecy may be achieved
before 2015 if things went fine in
Nigeria.
Co-location, Wimax, and Number Portability
The issue of co-location was aired when
Nigerian Communications Commission
in collaboration with
Telecom Answers Associates, an
indigenous telecoms consultancy company
and
Helios Towers Ltd a frontrunner
co-location licensee brought key
industry players and stakeholders
together under the Co-location Forum
2009 to deliberate, coalesce their
thinking, experiences and views on the
development of Infrastructure Sharing
and co-location as a concept and modus
operandi to be embraced primarily by
industry. The forum report attests
co-location is a worthy cause and the
report went ahead to publish industry
networking and industry resource data
which investors would take advantage as
a result latch on to co-location as a
viable option of industry management
tool.
Marginal reduction in telephone tariff
3 years after the last review of tariff of telephone service, NCC
commissioned a new study into the
subject and came up with marginal
downward review of interconnection
tariff which served as a basis for
deriving subscribers’ telephones charges
by operators. It also went ahead to
prescribe adjustment on the rates
payable among operators at the end of
each of the next three years. An
industry study had prescribed tariff
review, foreclosed and recommended a
repeat to determine future decisions.
Strange? Not half.
Death Knell of NITEL and eviction of Mtel
NITEL, the First National Operator’s continued slide into obscurity
shows no sign of abating. It now looks
like the government is more confused
today than it was two years ago when it
shepherded the company into the stable
of Trans Corporation International,
a.k.a. Transcorp. The purpose-built
‘conglomerate’ of the previous
administration was revoked for failure
to follow through with the investment
and capital injection plan. The
parastatal was handed back to the Bureau
for Public Enterprises (BPE) to initiate
another, hopefully more successful sale.
Hoping against hope, they just might be
in another relay race. Transcorp of
course challenged the government’s
action and hinted at a protracted legal
struggle, but shortly after its senior
executives became guests of the EFCC,
the hint rapidly dissipated.
It all seems a far cry from days of old when NITEL was at its pomp
bestriding the industry unchallenged.
Days when all we had were land lines,
poor connectivity and low coverage and
when telephone cost an arm and a leg.
Death of $100 laptop in Nigeria
A few projects commenced by the Obasanjo regime, appear good
investment at least on paper albeit in a
customary fashion that betrays
democratic discipline somehow
conveniently got ignored by the present
government. One such project was the
$100 laptop, which disappeared from the
agenda and even more surprising nothing
is in place to replace it.
Cyber war campaign made an issue in Nigeria
The threat posed by cyber criminality on
Nigeria’s banking and telecommunications
institutions, was highlighted by the
President and Co-founder of EC-Council,
Mr. Sanjay Bavisi advocating internal
Information Technology (IT) policy to be
implemented by corporate big wigs.
Speaking at a seminar for bank and
telecom executives in Lagos, he called
for vigilance and companies should deter
just anybody taking a mobile phone into
a company as this was potentially
perilous as rogues could use mobile
phones or digital devices, to install
malicious software and steal data.
“Without human capital and proper methodology
in place, it will be difficult to
control cyber attacks,” he said.
Nigeria’s slow motion raises concern
The pace of Nigeria’s transformation to
a digital economy continues to be a
cause for consternation with Nigerians
in the Diaspora impressing on home based
that while mobile telephony had somehow
fulfilled
the major objective of providing
communication services throughout the
country, we are light years away from
what is a digital revolution. Nigeria’s
snail pace of reform was highlighted by
what
President Obama did not say in Ghana
dispatching Secretary of State Clinton
on a whistle stop tour of Africa to
wake officials up and ‘smell the
coffee’.
And who were those not listening? Those
who were supposed to.
Threat to the Regulator’s Independence
The national communications Act 2003, heralded as very apt at its
inception, may well just be due for
revision. The legislature mounted so
much debate and held public forums to
suggest a genuine desire to make the
regulator better able to fulfill its
role and discharge its responsibilities,
but is yet to back such talk, or indeed
desire, with the propagation of a
statutory framework that would bring
about changes.
The Act itself came under severe pressure when the independence of
the Nigerian Communications Commission
was tested with President Yar’ Adua’s
belatedly giving a ruling over the
controversial issue of 23.5 GHz
frequency auction. For reasons of
administrative convenience at best, the
President overturned a frequency
allocation which the regulator had
issued but did on specious legal
justification. Alas this afforded us a
chance to test a critical aspect of the
law which had all along been assumed a
good instrument of industry management
but which was crying out for a review
that could bolster the role of the
regulator to act faster than it could
otherwise have in evoking sanction on
erring industry players. But sadly the
opportunity was lost.
A threat to the independence of NCC represents a direct affront to
inward investment which, analysts say,
will slow down even more if it is
subjugated by ‘here-today-gone-tomorrow’
politicians. Mobitel's and a few others
might have seen their investment go down
the drain and the prospective challenge
to current players has been curtailed
but more importantly, it is the ‘wait
and see’ approach that investors would
adopt when it comes to squaring up to
the industry. Such a shame, more so for
the only industry sector that stumbled
on getting it right in the absence of
any discernible policy thrust that
assisted the Commission in attaining its
good performance.
Lagos State government on its part
continued its insistence on taxing
InfoTech infrastructure. The move was
construed by some as hostile to
business. To others, it was a
demonstration of the crippling
bureaucracy of the Lagos State
Government and constitutional aberration
of its House of Assembly, but more
importantly, it was viewed as
extortionist and draconian. To these
people, justice prevailed when both the
High Court and Court of Appeal ruled
that the regulation of the telecoms
sector remained the business of the
Federal Government.
Good Friends we lost
The industry suffered a colossal loss of some its most illustrious
contributors. This list included, Ndukwe
Kalu a patriot who contributed
immeasurably within and beyond his
capacity toward ensuring online
visibility and presence of Nigeria
within the cyberspace. The year also saw
the departure of perhaps the longest
serving minister of Communications in
Africa, South Africa’s Mrs. Ivy
Matsepe-Casaburri, who died at 71. She
was in her 10th year as Minister when
she passed away.
The Global Economic Recession
The year began with the global economic recession claiming its
first big casualty in the Telecom
industry. As the global meltdown’
beginning to bite, One of the victims to
feel its teeth marks was Nortel, - a
world class Canadian Telecommunication
equipment manufacturer, Nortel Networks.
Nortel sources said that phone companies
are reducing their orders and figures
are going downwards so Nortel has to
move fast. It went to Court to file
bankruptcy papers just as it was making
a debt payment of over a $ 100million.
Obama deploys Broadband investment to stem economic decline
The Obama administration ended the year
like it began – full of hope and
embracing ICT. Carrying the banner of
Keynesian economics (socialism to the
average American), it named 18 projects
that would receive a portion of the $7.4
billion in stimulus funds set aside to
bring high-speed Internet to poor and
rural areas that have been overlooked by
Internet service providers. Vice
President Biden announced the government
plans to distribute about $2 billion
over the next couple of months with the
remainder spent on mapping projects or
will be distributed in a final round of
grants in coming months. VP Biden said
the funds were the essence of the
Recovery Act sparking new growth,
tapping into the ingenuity of the
American people and giving them the
tools needed to help build a new economy
in the 21st century.
The World Wide Web was 20
In 2009, the world celebrated as World Wide Web turned 20. Not to
be confused with the internet which
describes the global network of
connected computers in a manner that
makes it an open platform, the year
marked 20 years of sharing of
information through a global database of
linked pages. What links both is how
radically change they have both
transformed our lives in the realm of
business, pleasure, research and
development. The founder of the World
Wide Web Sir Tim Berners-Lee is still
very much around leading its further
development.
Some things never change
Electricity Supply
The greatest malady of the telecom
industry has remained inaccessibility of
reliable pubic power supply. A 2006
study by Telecom Answers Associates on
why internet penetration remained low in
Nigeria in spite of high number of
licenses issues for service provision
reported that much when it said:
‘‘…There is a huge gap between demand
and supply of bandwidth. The gap is
brought about by consumers’ inability to
buy bandwidth and this inability is
accentuated by an indescribable and
worsening access to basic public
electricity supply across the entire
country…’
It was towards the end of 2009 that a
veiled suggestion for a truly
liberalized electricity power supply
industry came from a very unusual
quarters. Engr. John Ayodele a General
Manager in charge of Operations at Power
Holding Company of Nigeria, PHCN, in a
Lecture delivered to the NIEEE
recommended that the option of
‘Distributed Generation’ (DG) be
adopted. Distributed generation refers
to the proximity between electricity
production and the place of consumption
as a means of addressing the asymmetry
between investment, expenditure and
demand in the supply of power. The
lecture represented the first steps in a
long road to liberalization: That is,
generation, distribution and marketing
of electricity. Though the concept is
not new on the agenda of National
Electricity Regulation Agency, its
implementation had always dogged by a
perceived sense of insincerity.
2010 Expectations: More or more of the same
Industry restructuring, not merger, expected
The industry caught a whiff of the Minister of Information and
Communications pledging to recommend the
merger of the Nigerian Communications
Commission, NCC, and the National
Broadcasting Commission, NBC before the
end of the year as if it was a new
subject. As the year ended not much was
heard of the pledge. The reasons given
for a merger are at best specious as
industry players have consistently
argued that what is required in the
spirit of driving the industry and
economy forward is restructuring via the
wholesale review of regulatory and
administrative regime in a true, orderly
ICT industry.
SIM Card registration scheme
Eight years after the first use of subscriber identification
module, SIM system of locating users
within networks, Nigerian authorities
eventually introduced a scheme to
curtail the menace of mobile phone
handset theft in Nigeria, authorized and
commissioned a registry and anti-phone
theft system for Mobile phones in the
country. The registry and the service
are designed that a mobile phone which
is reported stolen will be rendered
useless as it cannot be connected to any
telephone network in the country. The
service which will be at no cost but
will require subscribers register their
15 digit International Mobile Equipment
identity (IMEI) numbers with the Central
Equipment Identity Registry (CEIR) thus
addressing the need to identify phone
users not only within the switch system
but also within the global networking to
curtail fraud and improve planning data.
NCC in the closing days of the year put
commencement date to March 1, 2010.
Broadband in Nigeria expected
Tempo of the clamour for Nigeria to make strategic
investment in Broadband infrastructure
is approaching fever pitch. Professional
associations, NGOs, those in academia
and industry players are united in their
accepting that although there is reason
to celebrate the rapid increase in
subscriber numbers, it has become
obvious the aspect of data penetration
through broadband that is supposed to
boost Internet penetration is lagging
behind owing to the unavailability of
full broadband services, coupled with
high cost of bandwidth.
Emerging businesses
A new Global Mobile Personal Service by Satellite provider,
Globaltouch West Africa rolled out
service from its earth station based in
Kaduna.
And two Nigerian firms Globacom and Omatek forayed into other
markets as they opened outlets in Ghana
and Benin Republic.
Space Research and Development: Its
business not technological development
–allegedly
NARSDA which celebrated its 10th
anniversary during the year started it
with a new administration which ended
the tenure of the biology Professor who
took charge of the agency in its
formative years. It took the country the
loss of a launched commercial satellite
in space to reappraise things. Quite
rich for an agency who in all ten years
of its existence and modus operandi has
no basis - not Act of law nor in the
appropriation of its finances by the
nation’s legislature. Such malady of
democracy or indeed the legacy of
somebody.
The agency has promised that the lost satellite
would be returned to space in 2010. Say
‘amen’, somebody.
Content development in Nigeria, Cyberchuulnews.com taking a
lead as it goes commercial.
CyberschuulNews.com has set April 21, 2010 as
the launch date for commercial services
at a public event in Lagos. A recent
release by the publishers to its
subscribers says a new world of
opportunities would emerge from the
stable of the e-publications The launch
represents an opportunity to marry
various independent and impartial
aspects of Telecoms and IT company
portfolios performance and financial
reporting with content to produce an
entity which is more vibrant
inspirational and an expression of the
magic of a creative spirit.
January 1, 2010
www.cyberschuulnews.com
The CyberschuulNews.com Team produces
Cyberschuulnews.
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