Hope: African Govts Must Address High Cost of Spectrum Licences
Director, Spectrum and Public Policy, Africa, GSMA, Mortimer Hope, who was in Nigeria recently, spoke on the need for Nigerian and African nations to address the issue of high cost of spectrum licensing, which results in the high cost of internet service
Cost of spectrum licence is still high in Nigeria and other African countries, resulting in high cost of internet service offerings. What can GSMA do to address this issue?
This is a national issue that needs national attention from different African governments. It has to be addressed through policy decision making among governments. Nigeria as a nation, has gone a long way in addressing issues with spectrum licences, and if the cost of spectrum remains too high, it will definitely affect productivity and cost of services because the operators who are paying for the spectrum licences will be spending so much money for licences alone and will not have enough money to build and expand their networks. Telecoms regulators in Nigeria and other African countries should not make the cost of spectrum too high, but should work towards making spectrum available to the operators at reasonable price, to enable the operators meet the rising demand for mobile services in their various African countries.
What are the expectations of African governments concerning mobile broadband spectrum allocation for Africa at the next ITU World Radio Communication Conference in Geneva in November this year?
At the 2015 World Radio Communication Conference (WRC-15) in Geneva in November, that is being put together by the International Telecoms Union (ITU), Africa has a rare opportunity to secure the future of the mobile internet. Decisions on spectrum allocation made at WRC-15, will define mobile connectivity well into the next decade.
Exponential growth in the use of mobile phones, tablets and other wireless devices accessing the internet, is putting intense pressure on existing spectrum allocations in Africa. Unless governments choose to grant mobile operators access to sufficient spectrum, countries across the continent will miss out on the substantial socioeconomic benefits that mobile broadband delivers.
It is therefore critical that governments and regulators take the opportunity that WRC-15 provides to take strategic and decisive action on spectrum allocation that will safeguard the future of mobile broadband in Africa. Policymakers need to act urgently to deliver all the undoubted advantages that the mobile internet provides to citizens throughout the continent.
How can GSMA help Nigeria to be part of the revolution of the Internet of Things?
It is an opportunity for the Nigerian government to use the present situation of insufficient spectrum licences for mobile broadband across Africa, to push for the allocation of more spectrum licences for Nigeria in order to address the issue of limited mobile broadband access, and at the same time, become part of the revolution of the Internet of Things (IoTs). Government should endeavour to get additional spectrum for mobile services, and if this is achieved, operators will have enough spectrum band to provide quality services and connect more devices that will drive the revolution of Internet of Things in Nigeria. The implication for this is that should Nigeria and other African countries miss this opportunity to push for more frequency allocation which has to be approved at the ITU’s World Radiocommunication Conference 2015 (WRC-15) in Geneva, this year, it means Africa and Nigeria will have to wait for another four years, when the WRC meeting will hold again, to address the issue of spectrum licence. Africa must therefore come with a common position for more spectrum allocation that will drive the revolution of IoTs.
What will be the economic value of the planned additional spectrum allocation for Africa?
It has several economic values for Africa and Nigeria in particular, which is the most populous nation in Africa with over 170 million people.
One of the benefits is that it will increase Africa’s Gross Domestic Product (GDP) within the next five years by $39 billion and there will be additional 500,000 jobs created within the same period. The benefits for Nigeria, range from between $2.2 to $4.6 billion, and it will also reduce cost of bandwidth, which will be 57 times lower than the current cost of bandwidth, especially when the C-band is made available for mobile broadband.
At the African Telecoms Union (ATU) preparatory meeting, which the GSMA attended in Abuja, the GSMA published the findings of a new report developed by Frontier Economics, which highlighted the substantial economic benefits of reallocating C-band spectrum, which is mainly used for delivery of satellite services in Africa, to mobile broadband. According to the report, access to C-band spectrum for mobile services will decrease marginal costs for mobile operators, leading to lower prices for mobile broadband in Africa.
Nigeria and other African countries stand to gain a lot, if they have a common voice, and present the case of additional spectrum allocation to Africa at the next International Telecoms Union (ITU) meeting holding in Geneva by November this year. Like I said earlier, Nigeria’s economic benefits range from $2.2 billion to $4.6 billion, which is 57 times the cost of migrating existing services, and South Africa’s economic benefits stand at $511 million to $1.1 billion, which is 13 times the cost of migrating existing services. All these could be achieved if African governments come up with a collective demand for more spectrum allocation for mobile broadband in Africa.
In addition, the total estimated revenue to African governments through mobile industry taxation and the auction of spectrum licences is approximately $13 billion.
Based on the renewed call on African governments, had there been any occasion in the past where Africans spoke with one voice for additional frequency allocation?
In 2007, when the 800MHz spectrum, which is the digital dividend, was made available, African governments largely contributed to its approval, because they spoke with one voice for the need of the spectrum licence. So we expect a common position from African governments for additional spectrum for mobile internet during the ITU Geneva meeting in November this year, when the issue is raised.
Do you see individual infrastructure rollout plan by telecoms operators as a challenge to quality service offerings, even if there is available spectrum?
Nigeria has a large population and it will not be economically viable for operators to rollout their own infrastructure. But if they have to build their own telecoms infrastructure and networks just because government did not provide the infrastructure, then it will affect their profit margins, which will eventually affect service quality. It is therefore advisable for government to always subsidise infrastructure rollout for the operators, especially in rural communities, where operators see as not economically viable for business. The truth is that everyone, including those living in rural communities must have access to communication, and that is the vision of ITU.
Government should be able to build infrastructure so that the operators could plug into them at any time to provide services, but in the absence of that, government should be able to subsidise the cost of individual infrastructure rollout plan by the operators. But I am equally happy that the Nigerian Communications Commission (NCC) plans to licence six Infrastructure Companies (InfraCos) across the six geopolitical zones of the country that will address the issue of broadband infrastructure in the country, and two out of the six are already licenced. This is a good development but more still need to be done.
What is GSMA doing to drive teledensity growth in Africa, and how has the challenge been so far?
In terms of driving internet connectivity and teledensity growth in Africa, the GSMA has been able to push for additional lower frequency band for Africa that are good for telecoms coverage.The lower the frequency band, the faster the deployment. We have also been pushing for the June 17, 2015 deadline for the digital migration in Nigeria in order to build on the dividend of frequency spectrum. The GSMA has been in discussions with African governments in this regard, encouraging them to do more, and we are beginning to get good results in the growth of internet connectivity and teledensity growth across Africa, including Nigeria.
What is GSMA all about and what is its interest in mobile operators globally?
GSMA stands for Global System for Mobile Communication Association (GSM Association) which is GSMA for short. It is a global trade group that represents network operators that use GSM technology for their networks. The GSMA also counts a number of manufacturers and suppliers that provide the GSM technology as associate members.
GSMA represents the interests of mobile operators worldwide, uniting nearly 800 operators with more than 250 companies in the broader mobile ecosystem, including handset and device makers, software companies, equipment providers and internet companies, as well as organisations in adjacent industry sectors. The GSMA also produces industry-leading events such as Mobile World Congress, Mobile World Congress Shanghai and the Mobile 360 S. In March next month, it will be organising the Mobile World Congress (MWC 2015) in Barcelona, Spain.
The Mobile World Congress for this year is a four-day event, beginning from 2nd to 5th March. Mobile communications revolution is driving the world’s major technology breakthroughs. From wearable devices to connected cars and homes, mobile technology is at the heart of worldwide innovation. As an industry, we are connecting billions of people to the transformative power of the internet and mobilising every device we use in our daily lives. This is exactly what the 2015 GSMA Mobile World Congress will be showcasing. It will convene industry leaders, visionaries and innovators to explore the trends that will shape mobile in the years ahead.