Globacom loses spectrum bid to Bitflux
Giant telecoms operator Globacom has failed in its bid to acquire the wholesale wireless broadband service licence, the 2.3GHz spectrum, which was put up for sale yesterday.
A relatively unknown Bitflux Communications emerged winner at the conclusion of the Open Access Model auction conducted by the officials of Nigerian Communications Commission (NCC) at the Transcorp Hilton Hotel in Abuja after biding the spectrum slot for $23.251 million to beat Globacom bid at $23.50 million.
The federal government had earlier pegged a minimum reserved price of $23 million for the auction.
Bitflux has 14 business days (from yesterday) as deadline to pay $23.251m, NCC’s Executive Vice Chairman Dr Eugene Juwah said.
Speaking after he announced Bitflux as winner, Dr Juwah said if the company pays the money within the 14 days period, it will also be required to pay additional N155m in the next 30 days because it does not have a unified licence, which enables it to carry out other communications services along with the provision of broadband.
But should the company fail to pay within the period, Globacom would then be given the opportunity to pay and acquire the licence, the NCC boss said. He said the auctioning of the spectrum is to expand the critical broadband infrastructure across the country.
In her speech before the opening of the bids, Minister of Communication Technology Mrs Omobola Johnson said there would be five-fold increase in broadband penetration across the country before 2017.
Represented by the ministry’s Permanent Secretary Dr Tunji Olaopa, Mrs Johnson said government would not accept any excuse from the service provider on the roll out of the broadband service.
Glo’s CEO Mohammed Jameel said his company felt the price was too high for its business plan.
He said Glo thought it would not make sense economically to bid above the price it did as it would not be realistic.
A representative of Bitflux, Biodun Omoniyi, said he was optimistic that the company would pay within 14 days.
Omoniyi also said the company would roll out services in the next one year, adding that it would get the whole of Nigeria covered with fast internet broadband in its first year of roll out.
Glo and Bitflux had earlier paid a non-refundable bid deposit of $2.3 million, among other factors, which qualified them for yesterday’s auction.
Protests greeted NCC’s announcement of the two companies as the only two that qualified for the final bidding.
Some of the contenders had earlier withdrawn from the race due largely to lack of confidence in the process.
Some of the companies that withdrew are, Zinox Telecommunications, Airtel Nigeria, MTN, Etisalat and Spectranet.
This paper had also reported exclusively that only few foreign and local firms expressed their interests in the bidding process.