6 December 2012

Nigeria: Etisalat Identifies Hurdles to Rural Voice Telephony

Telecoms operator, Etisalat, has highlighted the actual reasons for the slow adoption of rural telephone penetration by telecoms operating companies, despite frantic efforts made by the Nigerian Communications Commission (NCC), to reverse the trend.

NCC had through its Universal Service Provision Fund (USPF), provided incentives to telecoms operating companies, to enable them rollout telecoms services in rural communities, but it appears such incentives are not motivational enough, as rural voice telephony penetration still remained low, in spite of the over 107 million telecoms subscribers recorded across existing networks.

The high subscriber number recorded, amidst weak rural telephone penetration, is a pointer to the fact that telecoms operating companies are over concentrated in urban communities where the bulk of revenue is, at the detriment of rural dwellers who also have the right to tele-communications services.

Head of Turnkey Rollout of the Engineering and Deployment Department at Etisalat, Mr. Valentine Amadi, who shared his views with THISDAY, identified government tax on traffic generated in rural communities, as a major concern to telecoms operators, since the volume of traffic generated in rural communities, remained abysmally low, compared to what is being generated in urban communities and cities.

His argument is that government tax telecoms operators for traffic generated in rural communities, at the same rate with that of traffic generated in urban communities and cities, irrespective of the wide difference of volume of traffic generated in the rural and urban communities.

According to Amadi, "It has become necessary to institute a tax-free or tax-rebate regime to traffic generated in rural parts of the country rather than using the current Universal Service Provision mechanism which does not encourage telecoms operators. Government should on another level, finance the civil infrastructure needed by telecoms operators as part of utilities provisioning similar to water, power, among others and for operators to pay rent for them".

Speaking on the need for telecommunications operators to effectively deploy the fourth generation (4G) infrastructure for a new market in Africa, Amadi emphasised the importance of a review of existing infrastructure, regulatory, environmental and government issues and the need for government to take over construction of service ducts on roads in Africa for telecoms installations.

He said, "Strategies for deployment of 4G network are chiefly determined by factors such as technology, regulatory terms, market size, environment/location as well as cost/project finances. With a global market of 5 billion, a projected penetration level of 47 per cent by 2017, majority of the 1.8 billion anticipated new connections are expected to come from the developing economies which are deficient in infrastructural developments with roughly 62 per cent of Africans living in urban slums."

He further listed the fundamental institutional issues that confront operators in delivering a 4G network as spectrum assignment and availability, choice of technology across countries and continents, quality of service regulations for networks in hybrid architecture, convergence of platforms for all services.

Others include lack of infrastructure such as power, transmission, transport, security, and adverse local operating environments, uncertain regulatory environments as well as complex fragmentation of Long Term Evolution (LTE) technology frequencies at national and regional levels.

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