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2017: Year Of Telecom Upheavals, Milestones




The Nigerian Information and Communication technology (ICT) sector in 2017 was marked by upheavals in the Nigerian telecommunications sector, especially with the move by some banks to forcefully takeover one of the mobile networks, unethical practice of call masking and refilling by some network operators, mandatory enforcement of Code of Corporate Governance on service providers, perennial quality of service (QoS) issues and growth on the online space by Nigerian small and medium enterprises (SMEs).

The telecoms sector continued to flourish with growth in subscriber base, rise in the contribution of the sector to the gross domestic product (GDP) and increased investments inflows. Many of the mobile operators strengthened their operations, investing in new technologies and re-farming their spectrum to provide Fourth Generation Long Term Evolution (4GLTE) service.

$1.2bn Etisalat Debt

The $1.2 billion syndicated loan for Etisalat Nigeria given by 13 local and foreign banks dominated the telecom space from the first quarter of 2017 till the end of the year. In March, leading Nigerian banks tried to forcefully takeover Etisalat Nigeria over stalled payment of its loan domiciled in US dollars. This attracted the attention of the Nigerian Communications Communication (NCC) and the Central Bank of Nigeria (CBN).

But after months of talks to resolve the imbroglio failed, the majority shareholders of the telecom outfit namely Etisalat International and Mubadala of UAE abandoned their shareholdings in the beleaguered in the telecom network thus forcing the two regulators to appoint an interim Board and Management. This led to the renaming of the mobile network to 9Mobile Nigeria. As at the time of filing this report, five prospective investors are battling to acquire 9Mobile.

Telecom Growth

The telecom sector continued to grow, attracting over $70 billion (N21.4 trillion) investments as at the third quarter of the year, up from $68 billion in 2016 just as the federal government intensified the implementation of new policies that would attract further investments into the sector and the economy in general such as planned licencing of broadband infrastructure (InfraCos) providers and other spectrum.

Executive vice chairman, Nigerian Communications Commission (NCC), Prof Umar Danbatta said “We are at 21 percent now and our target is to hit 30 percent by 2018, consistent with the National Broadband Plan. Nigeria with a population of about 170 million is a preferred investment destination in Africa. With over 150 million active subscribers, in the voice segment, over 102 percent teledensity and a little over 92 million internet connections, Nigeria is indeed a place to invest.”

The telecoms sector contributed N1.549 trillion to the Gross Domestic Product (GDP) in the second quarter of 2017, representing 6.68 per cent increase from the first quarter of the year (N1.452 trillion) according to figures released by Bureau of Statistics (NBS’s) report on the economy.  The sector in Q2 of 2017, contributed 9.5 per cent to the GDP in contrast to 9.1 per cent contribution in the first quarter of the year.

QoS, Call Masking

However, the telecom sector continued to be dominated by issues of poor quality of service. Across several states and the Federal Capital Territory (FCT), delayed approval for installation of base stations/fibre deployments, non-implementation of National Economic Council (NEC) resolution on multiple taxation, levies and charges on ICT infrastructure in Nigeria were identified as major challenges faced by telecom operators.

Other challenges include inability of operators to co-locate because the sites offered for co-location were inadequate and do not suit the technical specifications of the service providers. All these necessitated poor telecom services such as dropped calls, poor and non-delivery of text messages in some instances and low capital expenditure by the operators.

Another fraudulent practice that crept into the sector was call masking and refilling- international calls which display numbers in the National Numbering Plan (NNP) as the calling number and vice versa- an unethical and anti-competitive practice identified among the various networks by NCC which retaliated by imposing fines on the guilty networks.

Also, NCC working with the security agency forced telecom operators to eradicate improperly registered, unregistered and pre-registered Subscriber Identification Module (SIM) cards from their network or face severe sanctions.

Mandatory Corporate Governance

Another major milestone recorded in the telecom sector was the mandatory implementation of the Code of Corporate Governance for all licenced telecom service providers in other to put the industry on a sustainable footing. NCC from the last quarter of 2017 also commenced periodic stress tests on the licensees in order to ascertain their viability as going concerns under the extant laws of Nigeria.

According to experts, the events of the recent past in the industry such as the failed takeover of Etisalat Nigeria (now 9Mobile) by 13 lender banks, underscore the urgent need for stakeholders to implement the time-tested governance principles in the conduct of their businesses. From deliberate violation of licence conditions to serial breaches of contractual obligations, the industry has never been this threatened, the experts said.

Online SMEs Presence, 24m IDs, IXPN Hub  

Nigeria continued to record increasing growth in online presence. The number of registered .NG domain names surpassed 100,000 as at November from figures from the Nigerian Internet Registration Association (NiRA), which witnessed significant growth in the .ng ecosystem using the 3R Model (Registry/Registrar/Registrant) of operation and management of the .ng ccTLD.

According to Revd Sunday Folayan, president of NIRA “The registration of the .ng domain contributes to reduced capital flight, creates jobs, skills development and contributes towards increased growth of our gross domestic product (GDP). We are all witnesses to the growth in tech startup businesses in Nigeria.”

Meanwhile, Google Nigeria disclosed that over 100,000 small and medium enterprises (SMEs) in Lagos and Abuja and detailed outlines of more than one million commercial and residential buildings in Nigeria have been added to Google Map to improve ease of doing business in the country.

Chief Executive Officer, Google, Sundar Pitchai speaking at an event entitled ‘Google for Nigeria’ held in Lagos few months said “This building footprint will help users get a better understanding of the world around them”, adding that over 1,000 new street addresses in Ikeja, Ikoyi and other areas of Lagos State have been added.

In a major plus for Nigeria, Ghana Internet Exchange Point (GIXP) connected to the Internet Exchange Point of Nigeria (IXPN) to route traffic locally within the region. While this process is on a vice-versa and partnership basis, the move is expected to enhance the chances of Nigeria becoming the regional hub for Internet content in the region and the continent; it will also serve as an opportunity for both countries to reduce cost and improve latency on the route.

Also, the National Identity Management Commission (NIMC) within the outgoing year made remarkable progress as the National Identification Number (NIN) in the database jumped to over 24 million from the seven million it was in 2015. It also increased to about 809 enrolment centres nationwide.

Daring Malwares, New Technologies

On the global scale, 2017 proved to be a lucrative year for cybercrime. Prominent malware and attack methods continue to evolve, creatively bypassing existing security solutions. Massive attack campaigns such as WannaCry, NotPetya and Fireball showcase the nature of today’s threat landscape. All regions have suffered from these large-scale attacks, reinforcing the need for proactive solutions.

The year was also marked by emerging technology breakthroughs in a number of fields, including artificial intelligence (AI), robotics, augmented reality, nanotechnology, quantum computing, biotechnology, the Internet of Things IoT), 3D printing and driver-less vehicles, among others.





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