The current structure of the telecommunications industry in Nigeria has been identified as an impediment to the attainment of the country’s broadband penetration targets.
Matthew Willsher, chief executive officer of Etisalat Nigeria, expressed this view in his keynote address at the 2015 Commonwealth Broadband Forum 2015 held in Abuja.
According to Willsher, “the inability of a majority of operators in the industry to achieve the scale necessary to support broadband deployment is perhaps, the most critical challenge affecting broadband growth in Nigeria.”
He said broadband deployment involves considerable amounts of fixed cost, adding that struggling operators who are unable to attract the volume of reasonably priced, long-term funding required to deploy and operate broadband infrastructure profitably, are leaving a major broadband investment deficit.
“The resultant shortfall is underlined by Nigeria’s ICT investment as a percentage of GDP ratio of 2.6 percent while the average for peer countries is 5.5 percent”, he said. While commending the Ministry of Communications Technology and the Nigerian Communications Commission (NCC) for their contributions to the progress made in the sector, he demanded for more work to be done to drive broadband development in Nigeria.
“Notwithstanding the appreciable progress in broadband deployment in Nigeria, considerable effort is still required to move Nigeria towards its broadband targets.
When benchmarked against peer countries, it is clear that there is a considerable gap between where we are and where we should be, given the size of our industry and economy,” he said.
He added, “Nigeria’s mobile broadband penetration stands at 10.1 percent while the average for peer countries in Africa is 30 percent. Peer countries have an average Smartphone penetration of 26 percent while Nigeria’s Smartphone penetration averages 12 percent.
In terms of mobile broadband affordability, measured by the percentage of average GDP per capita required for broadband access, the Internet Society estimates that Nigerians spend 9.8 percent of their average GDP per capita to access broadband while the average for peer countries is 4.3 percent.”
According to Willsher, tailor-made interventions by the NCC to ensure a more equitable distribution of value in the telecommunications industry, introduction of active network sharing, the refarming of the 800MHz spectrum, release of the digital dividend spectrum for use by the telecommunications industry and easing up of access to foreign exchange by operators are some of the critical policy and regulatory actions required to improve broadband accessibility and affordability in Nigeria.
He further opined that addressing the current challenges affecting broadband development in Nigeria will attract more investment with the resultant increase in broadband coverage and affordability. He noted that despite these challenges, Etisalat Nigeria had invested considerable resources in ’rolling out fiber across the country and in its pervasive 3G coverage of Nigeria’. He promised that Etisalat will continue to invest in broadband development as it sees broadband not only as an alternative source of revenue but a critical economic enabler with the potential to help Nigeria meet its Millennium Development Goals.
He concluded by calling on all stakeholders to take necessary action towards improving broadband availability and affordability in Nigeria citing studies which show that broadband has the potential to drive GDP growth for Nigeria in excess of N400 billion between 2014 and 2018.
Ben Uzor
