The Telecom Summit. What is this idea of a Summit that has got stuck in the Telecom Calendar?
The idea of the summit is to create a forum for stakeholders in the Nigeria telecommunication industry to come together. It is not an exhibition or an external event that we want to invite people from other countries. It is actually a Nigerian thing. And it is organised by the regulatory body, with the sole aim of bringing stakeholders in the industry together; for us at NCC to tell them what plans we have for the industry for the coming year. For instance, this one will discuss 2005 B expectations and policy direction B and what our expectations of the industry would be in year 2005. That is one of the aims.
The other one is that it is the only forum where you gather chief executives and senior executives of telecommunication companies operating in Nigeria under one roof to actually discuss the industry. If you call a seminar for instance, you might have one or two people who are high level people attending. So, it is actually a forum where we get senior people and decision makers in the industry together under one roof to discuss with the regulatory body, with the Minister of Communication, with other key stake holders in the industry, and talk about what the expectations of the industry is all about. We also listen and find out the problems the operators might have and what they may want to share with us. It is like an x-ray of what has happened in the past. And then, we look at what need to be done for the future. For the Nigeria Communications Commission (NCC), it is an extremely important event and we normally look forward to it with a lot of interest.
It is like your answer has sort of knocked our second question. We would love to ask what is it you want Nigerians to know about the summit. But we think that has been handled. You have the Telecom Summit, The Digital Bridge Institute and The Consumer Parliament, I just want to ask; how do these ideas come into existence and what is it that you expect them to do for the industry?
You know as we perform our duty, we continue to find new ways and new channels for facilitating the work we are doing. The idea of the telecom summit came three years ago when we thought that we needed to engage the industry in a close level and to jaw-jaw with them and exchange ideas. So we came up with the telecom summit, it was well received. We held a very successful first event and followed it up with a second one. Now the third one is here. That=s about the telecom summit.
For the Digital Bridge Institute, the concept came up less than two years ago, when we looked at the telecom landscape and there were issues that were facing us. The fact that we had so many telecommunication companies rolling out networks at a very fast rate. And it was obvious to everybody that locally, in Nigeria, we lack the managerial competence and the manpower to tackle some of the very critical roles that we should, especially in the professional technical area, and some even on the side of management and issues of that nature. Obviously, as government, you don=t want a situation where we start importing manpower. It wouldn’t really work properly.
Also, we noticed that a lot of money was being spent sending our Nigeria employed people to South Africa, to London, to the U.S, and to Europe for one kind of training or the other. So, it was important that we try and make sure that we have that facility in place, so that when the operating companies require manpower and require training, they can actually depend on a locally established institution. That is why we left no stone unturned in making sure the DBI is such an institution with enough international flare to satisfy the yearning of the telecom operators and the policy makers B which is the government B and also us, the regulatory agent. Even us at the NCC, we have a need for training and retraining of our staff. The DBI was conceived to fulfill that requirement.
The third one is the telecom consumer parliament. How did we come about that? We looked at the Nigeria telecom landscape and saw that a lot of networks were being rolled out. Suddenly, we were faced with issue of having to contend with consumer issues. Nigeria is a large country, the operators were many, and of course, Nigeria was also growing the networks at a very fast rate. Like I always say, we have three constituencies that we service; the government B that=s one; the consumer B two; and the operator B three. It is a balancing act to ensure that you are able to satisfy the expectations of these three groups, because they are all important in their own rights.
The government lays out policies and they are anxious to ensure that all Nigerians have access to telecommunications. So, they need to come out with policies that will encourage that. Then, the consumer want tariff at an affordable price and at a very good quality. The operators need a level playing field to operate. They need to be encouraged by fiscal measure and policies of government to ensure that their investments are safe; that they are able to have security for their goods and installations. They would like that changes are not made in policies in such a way that their money is lost. All these have to be done in such a way that we also protect their interest. Because if you don=t, when investments die off, the consumer is not happy because he doesn’t get the service he is looking for. Government is not happy because it is not fulfilling it=s policy about universal access and service.
We need to balance the three contending constituencies to make sure we have a good flow and that we achieve the aim we want to achieve. That is what we have been trying to do over the years. We now looked and said, a forum where we can bring these three parties together might be a good thing. That is how the Consumer Parliament was conceived, because no matter what anybody says the consumer must be protected. The operators also, don=t like certain things they do to be published openly in other that it will not be detrimental to their business. So, when you have a programme on television, national television, the operators have responsibility to make sure they satisfy the consumer in such a way that those issues might not be brought up and it might loose face and loose value. That was the very strong point and we started it, and found out that both the consumers and the operators were very happy with the forum.
Many of the top level executives in the companies who did not have direct interface with consumers were now able to appreciate some of the issues the consumers were bringing up at this forum. So also were the consumers able to listen to the operators and appreciate some of the problems they (operators) have. When you look at what happened at the first few editions of the Consumer Parliament to the later editions, you would have noticed that the consumers have started appreciating the operators a bit more. And the operators are able to explain the reason why certain actions are taken, which ordinarily they would not have been able to explain to every individual. But on national television, you explain to every body that is watching the television programme. In that way, we have more people to address.
That=s why organisation like ITU, when we talked about the Consumer Parliament, recognised it as an alternative dispute resolution mechanism that can be used to actually address fundamental issues that concern consumers and their relationship with operators; and the regulators for that matter. When we started, some people were saying you might be exposing yourself as the regulators; people might tell you whatever they like. But because of the transparent organisation we run, we try not to shy away from being criticized or being evaluated by the public, because we are a public institution, primarily. It is from what people say that we can learn or change. If we are unto ourselves, and don=t listen to the public, we don=t hear about what they feel about issues, then we will not be doing our work well. People might not necessarily be appreciating what we are doing. So, that=s how the Consumer Parliament came about and I think, so far, it has met with the aim that we envisage.
You have said something about DBI but let=s get more insight. How is the enrolment going? Is it well serviced at the moment?
It is well serviced. After the commissioning by the President, it was now time to fine-tune the courses and start running them. It is growing in terms of its enrolment. I like to say here that the Digital Bridge Institute is not a polytechnic or a university. It is a place where specialized training is organised. Right now, what we run are short term courses, not long courses that you come out with a degree or a diploma. That might happen at a later date.
In fact, another important thing that happened is that we now have what we call the Advisory Council for the institute. We had the first meeting of the Advisory Council on September 29, and the second meeting on October 29, 2004. The advisory council is made up of 30 members, drawn from the industry. Managing Directors and executives of major telecommunication companies are in the advisory council. We also have some people who are invited on their own right, some notable people in the industry.
We also have some people from government agencies, and of course, our parent Ministry. All these make it a powerful Advisory Council that would be meeting, about two times a year, to advise on curriculum and expectations of the industry. The Advisory Council came out with a statement that the institute should try not to start with the award of degrees and diplomas but face professional courses that will enable people adapt easily to the requirements of the industry.
On the manpower required for training the students B that is the tutors or lecturers what is the local content input?
It=s a mixture. I can=t tell you the mix now but initially we think there would be a lot from abroad, because it is actually an international institute. Rather than export 20 students from Nigeria to a location outside this country, it is easier to bring one expert from abroad to Nigeria to deliver such courses if there is need for such expertise. But there are also local experts that have been identified who would also be involved in delivering the courses locally.
From your vantage position, if you are going to take a dispassionate look at the industry, what would you say remains the problem?
The problem of the sector still remains the issue of the spread of the telecom services. First of all, we would like all Nigerians to have easy access. Mind my words, I didn’t say ownership. All Nigerians should have easy access to telecommunication services. And in response to that we have put payphone services and call-centre services under what we call compilation. That is to encourage all our operators to roll-out as much as possible calling-centres and payphone points in our villages and cities to ensure that so many people have access to telecommunication. Yet, we are daunting about the rapid growth in network. But we are also mindful of the fact that we are just beginning. We are 120 million people with about 7 million lines. It is still a long way from meeting what I will consider a comfortable teledensity. Teledensity of 5B1 is good when you compare it to what it used to be, before now. But I will be happier when we get to the double digit mark, perhaps looking at the 10s and 20s that is when you can say; oh! It=s a country that=s digital.
Another important issue is that our progress has been mainly in voice communication. In the modern world, you talk about ubiquitous networks. You talk about broadband connection. Very soon, when we think we are bridging the digital divide and providing voice access to people, what would be facing would be a world that is witnessing a broadband divide. There are many countries that now have a lot of broadband connection, and they are facilitating communications in ways that have not been known before. Thats why I=m saying that there=s still a lot of work to be done in our country, and we need to now start on how best to facilitate it.
One of such ways is our pet project called AThe Wire Nigeria Project.@ Maybe the word project can sound confusing because it could sound as if we are the people to implement it. But it is a concept that we say is important that Nigeria has a wide spread of optic fibre infrastructure across the country. The network of fibre that we have, today, are only limited to certain roads. We like to see, under the wire Nigeria concept, that every part of this country, no matter how remote, is connected, to a backbone infrastructures, not just by radio but by optic fibre. We are happy that the national carriers, both NITEL and Globacom, are now addressing these issues. We have also taken the initiative of licensing a few companies to handle some of part of optic fibre installations that we think some of these big operators may not be interested in doing. We are even considering using the Universal Service Fund to also encourage the building of optic fibre infrastructure around the country.
That is very dear to my heart, something that I want to see actualised within a very short time. It lays a solid foundation for the various networks to spring up from various parts of the country without problems. As you know, some companies today, M-Tel in particular, they have base stations in some parts of the country but they have not been able to energize them because they don=t have transmission infrastructures to back-haul them back to their switches. Some others are using very expensive satellite communications links and sometimes they break down. All these can be minimized if we have a good transmission backbone in the country. That=s a challenge. Related to that is the issue of quality. Quality has many parts to it. One network that is of a poor quality can affect other networks. If network A has good quality and network B has not-so-good a quality, when subscriber in B dial into subscriber in A, he is only using part of network A that is of good quality, he has problem with some parts of B network that might not be so good.
So the link is the aggregate of those two. They say a chain is as strong as the weakest link in the chain. It is the same thing with telecommunication. That=s why we always talk about the fact that we have one network. No matter how many operators, we must try and build networks in such a way that they all operate at a fair amount of quality. For instance, if a call emanates from a NITEL network and goes through optic fibre infrastructure to land in Abuja and from there goes by satellite to a remote location, if there is a problem in that satellite link, then the whole network has a problem, despite the fact that some part of it is good. It is a collective thing, that=s why sometimes, we try to tell people that they should be patient, occasionally. Because there are many things we should have done many years ago, which we are just doing B things which we should have done 10-15 years ago, like this optic fibre infrastructure. Many countries did theirs years before, but we are just trying to do ours now. All these add to the issues.
From what you have said, both in terms of roll-out and in terms of in-flow of investment, we are not on a cruise level yet. Are we?
We are not on a cruise level now. I wouldn’t say we are on a cruise level. We are doing well by comparing with our standard before. We are doing extremely well because it is not just the mobile operators that are attracting investment to the sector, even fix operators are attracting some investment. But billions of dollars are required in order to reach that double digit subscriber base that we are talking about. So, we can=t say we are on a cruise level but we are doing well in terms of comparative analysis. Is like if say we had two lines before, but now we have 10; one can say that=s a 500 percent increase in subscriber base. But that doesn’t mean that 10 is such a wonderful number. That=s the kind of situation we have, presently.
Let=s look at the issue of rural telephony. How will the NCC get our operators to give access to the rural areas?
The truth of network today is that many rural areas have access to them, especially those that are on various highways. The highways that are completely covered as it were; from Lagos to Benin for instance, and Abuja to Kaduna. If there are villages along the way, they will get signals because of the nature of radio communication. But what we want to do is to encourage operators to go to the rural areas. That is why we have the Universal Service Fund to encourage operators to take the initiative.
Again, that is not all, because that goes back to the initial thing I said about infrastructure. If you have transmission infrastructure in the rural area, you dont need to convince operators to go there. I gave example of M-Tel that has some base stations that have not been fired up because there is no transmission. You can go to a remote location and say you want to do rural telephony, but how easy will it be to back haul that thing to the national network? So they all go together. In the Wire Nigeria Project, there is a rural telephone initiative indirectly, because most cities, today, have network. But the thing is now to go into those areas that have not been paid attention in the past. And once the backbone infrastructure is there networks immediately spring up. What we have noticed is that the Nigerian entrepreneurial spirit is so high. The day a base station lands in location, check the day later, you will see businessmen, already, setting up call centres, no matter how remote the area is. We are working in tandem with the operating companies, but they can only move as fast as they can go.
Is government actually prepared to foot some of the bills, viz a viz the infrastructure?
Yes, I mentioned it earlier. Thats why I said the Universal Service Fund would be applied. I am sure, if there is need for government to inject more money, they will do.
Looking at the picture of the industry that you have painted, it is like so much money is required to build up infrastructure. And from what is on ground, I don=t think the operators, as they presently are, would be able to raise all the money. I don=t know, I don=t know whether at anytime you thought of giving out more licenses than are presently available?
The truth there is that investment doesn’t necessarily come with the number of licenses. I give you an example; before the Obasanjos government, the previous military regime had issued so many mobile licenses. Over thirty (30) offers were made to various companies. About 10 or 12 of them eventually got spectrum allocation, but none rolled out, because the investors didn’t know who to finance. As Mr. A is coming out from the bankers office, Mr. B is entering with the same piece of paper. It is not necessarily the number of licenses that determine how much investment you get. In fact, if you over license, you might even actually discourage investment, because certain market can only absolve a certain limited number of operators, otherwise it will become uninteresting to investors. Saying that the number of operators, today cannot attract the required investment; I am not sure I will agree completely. I think we have done extremely well by licensing as many operating companies as possible. We have many fix operators, four mobile operators and two national carriers. Many countries around us, like South Africa - they just have three operators who are worth anything, though they are liberalizing the environment. Maybe by next year we may start seeing a few more operators in that environment.
But sometimes, two many licenses could actually dry up investments in a particular environment. Another thing is that these operators, even if they have all the money today to roll out 20 million lines they cannot roll them out because you need human beings to install them, the logistics to do it is very high. You need training, infrastructure, transmission capacities, generating set all over and who to man them, rights of way, and shipment/freights. All these things dont happen over night. They are built up in a gradual manner. If you do it too fast, you crash. So its not just the money, also you need to order the systems to come in a systematic basis. You need to clear them. Though you might have all the money, the sheer logistics is very demanding. Thats why I am saying, the people today are doing well in terms of rollout. In fact, sometimes Nigerians are even saying some of them are moving too fast. Its all part of the fact that a lot has been achieved.
Is it possible we put a price tag? Are you satisfied with the tariff operators charge consumers?
Every environment has its own development peculiarity. Tariff level is something that depends on the issue of supply and demand. See what is happening with the cost of SIM (cards) packs in the market; it crashed. I suspect that by December it will might even be N1, 000 or there about. That is the dynamic of a market. And these operators are pushing investments in to infrastructure. I create a pipe today, lets say one thing that flows through that pipe is called minute. I look at my pipe exit and the number of minutes. The capacity of this pipe is one million but really the number of minutes I am generating today is probably 1.2 or1.5 million. If I reduce the price the number of minutes will increase to 2million. Meanwhile, my pipe can only accommodate one million minutes, that is the challenge.
In many countries you have excess capacity. Like call these advanced countries, they build backbone infrastructure; in the night, the exchange is idol so they offer you to use the exchange free of charge at very minimal price because the capacity is there, they want to encourage people to use it. Now that the price is N48 in Nigeria, there is congestion. Can you image what will happen if the price is N20, you will not want to leave the phone. They need to build the capacity to be able to absolve that level of a call in their network and that is why they are building more base stations and more transmission infrastructure. I told people a few moths ago that the price of Sim pack before the end of the year will be much less than N2, 000. You achieved that even in this September. And my prediction next year by the time more and more infrastructure is built and operators have reduced their call charges, the capacity is there, people will want to use their phones the more.
It helps to rebuild a competitive mind. And thats what is happening today and in fact we are in a very exciting time. All the predictions we made in the past have been coming true. And what we want to assure everybody is that it will keep getting better. Thats why we went ahead to do the inter connect regulation that we did. The idea is to give the operators lead way to reduce their tariff at will. You know when the interconnect tariff was N18 between mobile and fixed, nobody could bring tariff to that N18 because we knew they wont make money. Globacom has come down to N19 because that they dont have to pay the other operators the previous interconnect rates. So you can afford to play around figures. We were pro-active that time and said, we did our studies and this is the right level that it should go and that we insisted on, because we knew we were in the right part. And that is also having the consumer in focus and allowing the competition to be able determine the price levels.
Before that interconnection rate that you came out with, most people have actually said you were on the side of the operators. I want to ask you now, on whose side is the NCC?
I think my answer came from the first statement I made that NCC have three constituencies to look after. So NCC is not on the side of anybody. We are actually here to help the consumer and make sure they are not taken on a ride. We are there to implement government policy on telecommunication industry and we are there to protect the investment of the private operators to make sure we maintain a level playing field and that the investors who give them money to spend have confidence in the telecom environment so that they will be able to invest more money into the network. What we want to do is to be fair to all concerned.
Coming back to the Telecom Summit, what do you want participants to take away?
At the Summit we would be announcing a few things about our policies for next year and likely issues that will be coming up. Secondly, we will have a workshop at the last day, what we will call open forum where we=ll discuss about what people will expect us to do post 2006 when the exclusivity period for mobile operators expires. I think from the various presentations and the outcome of the conference, Nigerians will have an idea of what the future holds for the telecom industry in Nigeria, and what plans the regulatory body has for ensuring that we sustain the successes that have been made in the industry so far. Thank you very much.
You have been manning this office for some years, what are the experiences, challenges and your future aspirations?
I must say that the job has been very challenging but it has also been very rewarding. I have enjoyed every minute of my stay here because when your effort is being rewarded by productivity, achievement, and goals of the industry is being met, you can feel no less. I must say that I am grateful to the government, the President, Vice President and our very good Minister that we have in Telecom today, and in fact, the previous Minister was also very wonderful to me. We have enjoyed good working relationship. And Nigeria has not only made its mark locally but also internationally. It=s a country that is now recognised in the Telecom industry. It=s a big honour and it is our hope that ours would be an example for other African countries to follow.
So as far as that is concerned, I feel much fulfilled and excited also because it has given me a chance to be of service to my country and that is also a most rewarding experience. I have met so many big people and I have a lot more energy in my body that I hope I will be able to continue to provide much more for the active development of our great country.
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