THE Nigerian Communications Commission, NCC, recently made a commendable intervention in Nigeria’s broadband development by seeking a favourable pricing model for broadband services in the country.
The Commission also enlisted the services of research consultants, KPMG, to study the market and recommend a pricing model that will reflect current economic realities, suit the pockets of Nigerian subscribers and ALSO ensure that operators remain in business.
KPMG is, among other things, also to recommend the guidelines for regulating the pricing of retail broadband and data services in Nigeria and determine price cap and floor where necessary.
The report is expected in April when NCC will involve stakeholders in reviewing it.
The need for the action the NCC has taken cannot be over-emphasised. “Broadband for all” is a concept that is catching on in many developed countries, but only a paltry 38,000 km fibre out of about 120,000 km of fibre network required for pervasive coverage has been deployed in Nigeria.
Meanwhile, submarine broadband cable investments by private concerns like MainOne, Glo 1, WACS and Sat 3, have a volume of terabytes lying fallow on the shores of Lagos while the country struggles fruitlessly to achieve “last mile deployment” due to the inability of the federal and state governments to harmonise the Right of Way (RoW) levies that give operators access to deploy services.
The National Economic Council (NEC) RoW guideline stipulates N145 per metre for laying fibre network in every part of the country. But it is observed that states have arbitrarily fixed their own charges which range between N1,500 and N6,000.
While states like Rivers and Abia charge N1,500 and N2,000 respectively, others like Lagos, Delta and Ogun charge up to N5,840, N4,600 and N6,500 respectively.
Experts believe that adequate broadband penetration will contribute a lot to the GDP of the country and boost economic diversification.
This could happen if the country does something about its current low broadband penetration.
South Africa’s population is a fraction of Nigeria’s but due to pervasive broadband penetration, strong mobile companies are moving their headquarters there instead of where the population and demand could easily drive high returns on investment.
This is where the regulator should pay more attention. To make broadband available to all Nigerians irrespective of where they live, NCC should spearhead an aggressive harmonisation of the RoW fees paid by operators nationwide.
It will help a lot in ensuring that cable investors speedily complete their “last mile” deployments. This will not only explosively boost broadband availability in Nigeria, it will also drive down prices and the common man will benefit immensely.
The ball is now in the court of the regulator. Without the RoW harmonisation to enable the cable providers complete the good work they started, it is simply impossible to give Nigerians favourable broadband pricing.
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