10 Years of GSM in Nigeria: Shape of things to come

Ten years is gone since Global System for Mobile communications, GSM debuted in the country. The celebrations, last week also depicted the the warm welcome the technology received at berth and goes ahead to show what impression it had made in the lives of Nigerian people in these past decade.

For instance a recent report released by the Nigerian Communications Commission (NCC) pitched the Foreign Direct Investment (FDI) the industry has attracted in the last nine years to about US$15 billion. Even one of the operators, MTN Nigeria pitched its in-country investment alone in excess of N900 billion. This is aside the $1 billion the company will spend on capital expenditure in 2011. According to the Corporate Services Executive of MTN, Mr. Akinwale Goodluck, the money will be spent on optimization; expanding the fibre-optic cable network and the micro-wave backbone that the company has built round Nigeria; “as well as improving transmission capacity, building more base stations and substantially increasing the capacity of our network,” he said. He commented that the $1 Billion ear marked for 2011, represented 70% of the capital expenditure for the MTN Group’s West and Central Africa region. 

The Nigerian telecoms market telephone subscriber figure is estimated to be about 90 million active lines (fixed and mobile) and still growing. The potential of the market, in spite of achievements so far, remains enormous. Market expansion and subscriber numbers are expected to grow exponentially in the next few years even as mobile operators extend coverage to more of the uncovered villages and rural communities.

Projection for the market is that it will grow to 118 million mobile subscribers by 2014, while the NCC predicts that teledensity will reach between 90 and 100 percent by 2020.

Without any gainsaying, the telecommunications industry in the last 10 years has positively impacted the country and its citizens in a myriad of ways. We will waste space and time, if we were to list them all here in this article. But perhaps the informal sector is where the impact of the mobile revolution is most visible.

Today, hardly can you find a mechanic, fisherman, tailor, hairdresser, carpenter, vulcanizer or a cattle header without a mobile phone. Business has never been better for the people employed in this sector, and the impact on the economy has been tremendous.

As GSM marks 10 years in Nigeria and as we salute the operators for their accomplishments, it is a useful exercise to reflect over what used to be and what we now have, so that people can truly appreciate the positive changes that have taken place in the last 10 years and also plan how to consolidate the gains in the years ahead.

Goodluck, captured this succinctly recently when he remarked that it is quite possible for people to think GSM has been in Nigeria for more than 10 years, considering its impact so far and how most people today cannot afford to stay away from their phones for a full day.

He gave a rather interesting, but very true illustration. Most people would fret more today if they forget their phones at home than if they forget their wallets. It is funny but it is true. The phone has somehow become a very important part of our lives. And in the few cases when it gets left behind at home, the owner feels incomplete and vulnerable the entire day, and productivity for the day can be seriously affected.

True that a number of sectors

in the country have witnessed unprecedented growth in the last decade, but the financial sector has witnessed a total overhaul as a result of the Information and Communications Technology (ICT) revolution. For instance, Automated Teller Machines (ATMs), mobile banking, online real-time banking, electronic fund transfers, local and international debit and credit cards, ePayment and Point of Sale (POS) terminal deployment and so many other technology-driven changes have defined Nigeria’s banking industry in the past decade.

Today, in spite of the expansion of the financial industry, penetration is still considered very low as formal banking coverage of Nigeria is estimated at 14% in the last 120 years. Insurance penetration is less than 1%. Experts believe that the mobile platform can be used to improve penetration for these two critical industries. Experts predict that if the mobile platform is effectively utilized in the insurance industry, penetration can increase by 10% within the next 10 years. This projection is made on a premise that the country already has over 85 million lines which can be deployed to provide the public various financial and social services.

However, industry players are of the view that the ICT sector still have room for improvement.

At a recent public function in Lagos, the Executive Vice Chairman of NCC, Engr. Eugine Juwa charged the operators to improve on their quality of service or face the music. He stressed the determination of the agency to sanction any operator that is found to be flouting the law, even as he threatened to issue more license to encourage competition, should the existing operators fail to render commensurate service to their charges.

He also harped on the need for the operators to increase their base stations to accommodate the increasing traffic on their networks.

According to him, it was for this purpose that the regulator directed the operators to stop all forms of promotion, since the operators can no longer guarantee the quality of their services.

More worrisome to some stakeholders is that the operators operate with only 13, 000 base stations across the country, serving the 145 million Nigerians, despite the huge amount of money they wreck in daily. Their argument is that since Nigerians are willing to pay for the services, they have no reason not to deploy more infrastructure that will guarantee quality services.

The National President of the Association of Telecommunication Companies of Nigeria, Engr. Titi Omo-Ettu, also at a function recently, cited poor infrastructure and the unfriendly business environment in the country as a major challenge confronting the operators in Nigeria.

He said that connecting the next 50 million Nigerians to broadband must be the centre stage for the next decade of GSM growth.

For Chairman of Zinox computers, Dr. Leo Stan-Ekeh, though Nigeria had recorded some significant growth in the past ten years,it failed in the area of building capacity and developing local content.

For Nigeria to join the rest of the world, as a global player in the emerging knowledge economy , it must begin now to build local capacity and encourage growth of locally made goods to enable her face future challenges.

Former President of ATCON and Chairman of Teledom Group, Dr. Emmanuel Ekuwem, said that there is no doubt that the past ten years of GSM in Nigerian had been eventful and impacted so much on the economy, in the area of direct foreign investment, boosting internet penetration, and enhancing communication, Nigeria must begin to focus on building technical know how and solving problem of unemployment through ICT.

He was also of the view that Nigerian must begin to discourage patronage to foreign made goods at the detriment of locally made ones, if it must remain relevant in the 21st century economy and be self sufficient.

-By Prince Osuagwu & Emmanuel Elebeke 

Source: Vanguard