36 million telephone lines inactive – NCC, Fixed telephony faces total collapse


Out of a total connected telephone lines of over 141 million in Nigeria, over 36 million are currently inactive, writes DAYO OKETOLA

One of the key elements distinguishing the Nigerian telecoms industry is the robust active subscriber base it successfully recorded in the past decade from as little as 400,000 lines in 2001 to over 100 million in 2011. Notwithstanding the impressive and stable year-on-year subscriber growth, more subscribers had also dumped their lines. Specifically, over seven million lines had become inactive in the country between December 2011 and August, 2012, and this has raised concerns among telecoms analysts.

More disturbing to them is the near death of the country’s fixed telecommunications caused by the crisis engulfing the national carrier, NITEL and overdependence on mobile phone.

Experts observed that while more consumers were subscribing to telecoms service, many others were also dumping their lines, thereby aggravating the rate at which telephone lines become inactive in the country.

They, therefore, argue that inactive lines in the country, like the active ones, could also be seen as representing a veritable index for evaluating the industry.

The data recently released by the Nigerian Communications Commission revealed that mobile network operators such as MTN, Glo, Airtel and Etisalat added over 1.8 million new lines in August alone, thereby increasing the subscriber base from 103.4 million active telephone lines in July to over 105.2 million at the end of August 2012.

While active mobile subscription on the GSM networks increased from 91 million in January to 101.4 million at the end of August; the Code Division Multiple Access operators’ subscriber base shrank from 4.4 million to 3.3 million during the eight-month period.

Therefore driven by the subscriber loss by the CDMA operators such as Visafone, Starcomms, Multi-links, and ZOOMmobile, the number of inactive telephone lines in the country increased to 36 million in August, 2012 from 33.7 million in June, 2012.

According to the NCC, 35.8 million out of the country’s 134.9 million total connected lines were inactive in March, 2012, meaning that mobile operators could only account for 99.1 million active lines on their networks while the remaining lines had become inactive in March.

While 94.5 million of the country’s 99.4 million connected GSM lines as at March were active, the remaining 24.9 million GSM lines were inactive.

Additionally, CDMA operators had also lost over nine million lines as at March, 2012. Only four million out of the 13.1 total connected CDMA lines are still active.

While the total connected mobile and fixed lines increased from 124.8 million in December, 2011 to 141 million in August, 2012, inactive lines also climbed within the same period from 28.9 million to 36 million.

In the entire scenario, telecoms experts agree that fixed telephony seems to be facing the greatest risk as more and more fixed lines are going inactive.

Experts lamented that the culture of fixed telephony had been dying in the country with the constant climb of mobile telephony. Out of the 2.3 million total connected fixed lines in January 2012, only 688,333 were active leaving over 1.6 million dormant. In the same vein, out of the 2,395,680 total connected lines in August, 2012, 1.9 million fixed lines were inactive.

Fixed telephony experienced a sharp decline with the crisis of NITEL and it is feared it might go to extinction in Nigeria as the country continues to depend largely on mobile telephony. Out of the 2.7 million connected fixed lines in 2010, only a little over one million were active, leaving over 1.6 million lines inactive. Similarly, only 719,406 fixed lines were active out of the 2.2 million connected fixed lines as at December, 2011. This figure had decreased to 488,088 in August, 2012.

Above all, out of the 105.2 million active lines in the country as at August 2012, only 488, 088 were fixed lines, less than one per cent of the entire active lines in the country.

To ensure that fixed telephony do not go to extinction in the country, the Executive Vice-Chairman, NCC, Dr. Eugene Juwah, announced in February 2012 that it was considering awarding new fixed line licences in 2013.

Juwah said licences would be issued to fixed line operators in an attempt to revive fixed telecommunications in the country and stop the over-reliance on mobile telephony in Nigeria.

He said, “We have broad plans for broadband deployment to enable us create an impact in the whole nation. To implement this, we have adopted the open access model as the platform. We are also looking at resuscitating the fixed line sector by giving out new licences and in doing this, increase telephony penetration.

“The success of this twin action will give Nigerians an enhanced choice of products and services, reduce over- reliance on mobile services and encourage internet usage.”

However, the President, Association of Licensed Telecommunications Operators of Nigeria, Mr. Gbenga Adebayo, said this would be a little difficult saying the cost of investing in fixed telephony infrastructure was huge for many operators.

In the same vein, analysts with Africa Analysis, a telecoms and Information Technology research firm, Mr. Babatunde Afolayan and Mr. Dobek Pater, opined that issuing additional CDMA licences for the purpose of deploying fixed line networks was not going to drive the growth of the fixed and broadband markets.

What is needed, according to them, is the development of a broadband policy and a national strategy that will set out objectives and a broad framework for achieving those objectives in terms of broadband development in Nigeria. The policy, they said, must be translated into a set of actionable market regulations, with the objective of meeting the policy targets.

They explained that the reason fixed line market had not developed well was not due to an insufficient number of operators in the market, but rather due to the quality of the market players and market conditions the operators had to contend with.

Analysts, who shared Afolayan and Pater’s views, also agreed that the telecoms industry was not lacking in operators who had been issued with licences to offer fixed and fixed wireless services.

They are, therefore, sceptical of how the new licences to be issued will revive fixed telephony in the country.

According to The Punch report of February 26, 2012, there are 11 companies licensed to offer fixed wireless services in Nigeria. They include XS Broadband Limited, Witel Limited (formerly Startech Connection Limited), Rainbownet Limited, Odua Telecoms Limited, and Cyberspace Limited.

Others are IPNX Nigeria Limited, Wideways Nigeria Limited, Hyperia Limited, Mega Tech Engineering Limited, Horizon Broadcasting and Telecommunications Limited, and Swift Networks Limited.

Some of these licensees never rolled out any network and even those that did never made any significant impact as some were encumbered with frequency issues and fleeting technology.

Incidentally, the licences of these operators will expire by the end of the year.Apart from these fixed wireless operators, there are other bigger operators who obtained Unified Access Service Licences. By the UASL, they could render fixed telephony services but majority of them concentrated on mobile services.

The list comprises Starcomms Limited, Danjay Telecomms Limited, Prest Cable & Satellite TV Systems Limited, MTN Nigeria Communications Limited, Multi–Links Telecommunications Limited, Gicell Wireless Limited, Intercellular Nigeria Plc, Celtel (now Airtel) Nigeria Limited.

Others are Siotel Nigeria Limited, Gamjitel Limited, Emerging Markets Telecommunication Services Limited (Etisalat), Visafone Communications Limited, Reliance Telecommunications Limited, Alheri Engineering Co. Limited, Smile Communications Nigeria Limited, and Megatech Engineering Limited.

Experts reiterated that the problem with fixed telephony in the country, was not inadequate operators, but too many operators focusing on small fixed services operations and mobile services.

Punch


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