December 16, 2021/CSL Research
According to reports, the Nigerian Communications Commission (NCC), on Monday, 13 December 2021, auctioned its two available 100MHZ spectrum licenses in the 3.5GHz spectrum band to deploy 5G Network in Nigeria. Although there were three bids, the auction produced two winners, MTN Nigeria and MAFAB Nigeria Communications Limited while Airtel lost. The winners at the auction, which passed through eleven (11) rounds with a final bid price of US$273.6m each, have till February 2022 to pay for the spectrum or risk losing it. Expectedly, numerous concerns have been raised following the conclusion of the exercise, with the most common concern being the ability of MAFAB to effectively utilize the license as the firm was only incorporated in Nigeria in July 2020 (19 months ago).
Furthermore, to deploy the spectrum in Nigeria, the two companies would be required to hold Unified Access Service License (UASL), the operational License for the spectrum which is renewable after ten years. We observed that as of August 2021, only MTN had applied for a renewal of its UASL License as confirmed by the NCC and is waiting for approval from the commission. MAFAB, however, according to the information sourced from their website, do not have the UASL License but operates under Interconnect Exchange and International Data Access licenses. This implies that the firm would have to seek additional licensing before operating the spectrum.
That said, the deployment of the fifth-generation network in Nigeria undoubtedly holds positive benefits for the Nigerian ICT segment and the overall information communication and technology space. To kick-start the 5G network roll-out, the Minister of Communications and Digital Economy, Isa Ali Ibrahim, directed the Nigerian Communications Commission (NCC) to publish an implementation roadmap for the deployment of 5G across the country with service roll-out obligations. Leaving no doubt for health and safety concerns by many Nigerians, the commission is to develop relevant regulatory instruments to address health-related issues for the successful roll-out of 5G by Mobile Network Operators (MNOs). The proposed roll-out will be done in phases, starting with major cities.
Specifically, for Nigeria, adopting the 5G technology will improve network connectivity and user experience and further drive the country’s goal of becoming a digital economy. The emergence of the 5G era in the country presents many benefits for the country. If successfully deployed, we expect the fifth-generation network to be characterized by greater speed of internet operations, lower latency, and improved capacity for remote execution compared to the previous generations. It is also important to note how this could aid the implementation of virtual networks, teleconferencing, web3.0, and a host of other protocols powered by the internet.
