Fed Govt, Operators Disagree Over Proposed Cost Of 5G Spectrum

Operators in the telecommunication space have said the minimum price set for the planned 5G spectrum is too expensive and higher than what obtains in most other countries.

This was disclosed during the ‘Stakeholders Consultative Forum on the Draft Information Memorandum for the 3.5GHz Spectrum Auction’ which was held on Thursday in Lagos.

According to the Nigerian Communications Commission, the telcos expressed their concerns directly to them in a comment and recommendation format sent to the regulator.

According to MTN and Airtel, the reserve price of about N75bn ($197.4m) is too high and above what obtains in other climes of the world.

In their comments, the GSMA (an umbrella body for all the operators in the sector) raised concerns over the spectrum price, saying it might affect the plan to achieve affordable Internet access for a large portion of the populace.

The GSMA added that a licence tenor of about 15 years should be considered if the spectrum price is to be sustained.

Earlier, MTN had said the price should be reviewed to reflect market realities, while adding that the licence tenor should be put at 20 years as against the 10 years proposed by the NCC.

Echoing the concerns of the telcos, the Chairman, Association of Licensed Telecommunications Operators of Nigeria, Gbenga Adebayo, said, “We want to assure you of our commitment and readiness. A lot has been said about 5G, we look forward to today’s deliberation.

“We assure you that as we proceed, we will do all we can as a sector to ensure that 5G succeeds.

“For us in the sector, we are most concerned about the cost of 5G. This new direction will require a lot more investment, and the current infrastructure might not be sufficient and efficient for it.

“So, we need to address the issue of cost. In order not to have 5G that is only glamorously deployed and not efficient, we need to address the issue of cost.”

In his welcome address, the Minister of Communications and Digital Economy, Isa Pantami, said, “I am happy to inform you that the 3.5GHz spectrum band (the lower C-band), which is not effective in satellite operations, has been recovered from NIGCOMSAT and reallocated to the NCC in the first instance, for deployment of 5G technology based on terms and conditions agreed by both parties.”

In its response, the NCC said the base price for the spectrum was fair, adding that the agency had taken several factors into consideration it came up with the price.

The commission, however, added that it would consider the licence’s life span.

On the concerns raised about the availability of the spectrum, the NCC said, “Five lots of 100 MHz each TDD are to be cleared at different periods depending on the level of encumbrances on the slots.

“For the purpose of this auction, two lots of 100 MHz each are to be offered in the first phase of the auction.”

The NCC added that each lot of 1 X 100 MHz represents one eligibility point. According to the commission, the spectrum lot won by each bidder would be assigned on a nationwide basis, covering all the 36 states of the federation and the Federal Capital Territory.

Meanwhile, some stakeholders suggested that the bidding process should be postponed until the NCC encumbers the remaining three spectrum lots.

The NCC, however, said it would go ahead with the spectrum auction set for December 13, 2021, and would auction the remaining three lots in 24 months.