TELECOM: Leveraging Mobile Virtual Network Operators To Reach Unserved, Underserved Communities

Broadband coverage to unserved areas is critical to ensure delivery of quality internet services to every Nigerian, irrespective of where they are; yet, the Nigerian National Broadband Plan 2020 to 2025 document report revealed that 31,160,000 Nigerians live in areas without telecommunication coverage.

The report further revealed that there are 1,954,540 unserved people in Jigawa; 1,639,631 in Kebbi; 1,872,307 in Kaduna; 1,777,778 in Kano; 2,120,389 in Katsina; 1,831,880 in Sokoto; 2,032,764 in Zamfara; 1,430,991 in Adamawa; 2,630,828 in Bauchi; 2,249,301 in Borno; 843,134 in Gombe; 1,100,456 in Taraba; 1,647,475 in Yobe; 13,000 in Ekiti; and 992 in Lagos.

In Ondo, there are 142,123 living in unserved areas; 90,400 in Ogun; 45,926 in Osun: 466,665 in Oyo; 12,561 in Akwa-Ibom; 114,148 in Bayelsa; 388,333 in Cross River and 145,057 in Delta state, among others.

The absence of telecommunication coverage has provided a cover for criminal activities and insecurity in these unserved areas, the Nigerian Communication Commission (NCC).

To avert the trend in the country, the commission, on the 11th August 2022, notified the public that it would be issuing the Mobile Virtual Network Operators License (MVNO License) which would improve the telecommunication output of the country, enable the expansion and availability of quality mobile coverage, and close the gap to the unserved/underserved Nigerian population. NCC also issued the License Framework for the Establishment of Mobile Virtual Network Operators in Nigeria.

The executive vice chairman, NCC, Prof Umar Danbatta, at the Telecommunications Sector Sustainability Forum (TSSF) 2.0 conference on Mobile Virtual Network Operation in Nigeria, defined MVNO as a wireless communication service provider that resells mobile network services bought at wholesale prices from Mobile Network Operators (MNO), such as 9mobile, Airtel, MTN and Glo, for discounted amounts to end users and customers.

Pursuit to the Nigerian Communications Act  (NCA 2003), Licensing Regulation 2019, and other subsidiary regulations, the commission through the MVNO, has created an enabling environment where various players provide diverse services based on licenses, issued by the commission.

“In its drive to create enabling environment, the Commission has introduced Mobile Virtual Network Operators (MVNOs) license that will generate employment and bridge the gap between the unserved and the underserved in the society. It will also further engender competition and provide choices for telecommunication consumers,” Danbatta explained.

The EVC disclosed that the MVNO license is a five tier classification that has distinctive services to be offered by the players in different tiers.

“Tier 1 is a virtual operator, which relies totally on hosts facilities with restricted tariff control; Tier 2 is sample facilities operator, which owns intelligent network, and has loose tariff control; Tier 3 is care facilities operator which can negotiate interconnect agreements, has major tariff control; Tier 4 is a virtual aggregator/enabler, which performs aggregation and enabling but only operates in unserved regions and Tier 5 is the Unified Virtual Operator, which has freedom to operate in the whole segments/tiers,” he added.

Danbatta, who was represented by NCC director of Licensing and Authorization, Alh. Muhammad Babajika at the conference, said the Nigerian market is reported to have the demand for differentiated services with lots of gaps in several sectors especially mobile to fixed market, M2M, B2B, rural networks.

Additionally, the growing concern of over-the-top (OTT) OTT players eating into operator’s Average Revenue Per User (ARPU) offers prime opportunity for MVNOs to partner with these players therefore directing some revenue back to the MVNOs through in wholesale agreements, he averred.

Most importantly, with the government’s use of a multi-tier system for licensing MVNOs, The EVC urged potential licensees to complete its wholesale agreements with an MNO, adding that the bouquet of services depicted in the framework attempts to capture the several and divers levels of MVNO operations as observed in other markets.

He tasked stakeholders in the industry to collaborate on various efforts that will contribute positively while continuing to ensure that operators are conducted within the respective telecommunications licenses to ensure that service challenges and demands are adequately delivered.

The convener of the forum and managing editor of Business Remarks, Bukola Olanrewaju said MVNOs is of immense value to the mobile telecommunications industry as they provide services at an affordable rate to customers and work with Mobile Network Operators (MNOs) who own the telecommunication infrastructure.

The introduction of Mobile Virtual Network Operators (MVNOs) is believed to add value for both operators and customers; for the operators by using their available excess capacity and for the customers by offering innovative and several niche value-added services that were not offered by Mobile Network Operators (MNOs), Olanrewaju stated.

“From the consumer side, MVNOs can provide more competitive offerings, which means lower costs without compromising on service. Utilizing network capacity without having to own it frees up costs that are then passed down to the consumer. MVNOs can also offer a more tailored-made service via MNOs, which tends to offer more of a generic service that suits the masses,” she averred.