NCC rejects operators’ plea for longer tenor on spectrum fees

 

frequency 

The plan to hike spectrum fees by about 400 per cent is currently a source of concern to telecommunications operators in the country. 

But to cushion this impact, operators suggested that spreading the payment for spectrum over a period of time would help a great deal in managing capital expenditure (CAPEX), cost of sales and guarantee investment for the continued improvement of network infrastructure.

   

According to them, a longer tenor will be in alignment with the provisions of the New National Broadband Plan (NNBP) 2020-2025, wherein it was recommended that the payments of spectrum fees should be spread across the lifetime of the licence to ensure network rollout is not adversely impacted. 

Despite the appeal, the Nigerian Communications Commission (NCC) did not give assurance of granting the demands of the operators. 

The service providers expressed these concerns at a virtual public hearing organised by the NCC. The draft spectrum regulation, the outcome of the hearing, recently released by the Commission, showed that submissions were received from operators, including Airtel Networks Limited; MTN Nigeria Communications Limited; IHS Nigeria Limited; Smile Communications Limited; VDT Communications Limited, and Huawei Limited. 

Already, ahead of the planned deployment of 5G networks in the country, the Federal Government, through the NCC, has disclosed that each slot of the spectrum frequency would be going for a fixed price of N75 billion. 

In the draft spectrum regulation, Airtel raised the fact that the 400 per cent increment in spectrum fees, would have negative impact on the industry, especially with the need for more rollout of 4G networks and the impending 5G. 

According to the public hearing report, “Airtel requested the Commission to retain the subsisting regime to support expedited deployment of 4G/5G technologies for the continued growth and development of a more robust digital economy.” 

From Smile Communications’ perspective, spreading the payment for spectrum over years would help operators a great deal in managing capital expenditures and upgrades of network infrastructure. 

But the NCC in its response to this, said the provision of the New National Broadband Plan 2020 to 2025, under reference presumed and proposed the payment plan for new entrants/new licensees. “However, the commission will continue to determine the payment plan as applicable. Therefore, the recommendation is not acceptable,” the regulator said. 

Corroborating Airtel’s stance, VDT Communications, a wholesale broadband provider, observed that the unit price per MHz for each licensing region was increased by 400 per cent and opined that there was no clear basis to arrive at the unit price per MHz.