The National Communications Authority is confident of correcting ‘market imbalances’ in the telecommunications sector with the introduction of technology neutrality for non-significant market power (SMP) operators.
Technology neutrality is one of the remedies to address significant market power concerns, by creating a level playing field and stimulating investment in infrastructure for the deployment of 4G networks by non-SMP operators in the country, the NCA stated in a statement.
Vodafone and AT (formerly AirtelTigo) will be the major beneficiaries of this development. The introduction of technology neutrality will enable them to re-farm their spectrum assignment in the 900MHz, 1800MHz, and 2100MHz bands to provide 4G services, subject to paying an annual premium.
Benefits of technology neutrality
As one remedial action to address SMP concerns, the benefits of technology neutrality are vast. It provides opportunity for operators that do not currently have 4G services to deploy it within their current spectrum, levelling the playing field and enhancing their competitiveness. In addition, it offers an option for non-SMP operators with 4G services to re-farm portions of their current spectrum assignment to improve the quality of their 4G services.
Deepening Internet penetration
Industry players are confident that the move will enhance efforts by government to close the digital divide between ‘haves’ and the ‘have nots’ by boosting mid-band spectrum availability to ensure that the yawning digital divide is bridged.
“The issue of spectrum-pricing has never been more vital. Awarding significant amounts of additional spectrum is central to expanding and upgrading mobile broadband services – and will be core to the success of greater Internet penetration,” a source who pleaded anonymity told the B&FT.
“Instances of spectrum licences being sold for extremely high prices, or going unsold due to the cost, are becoming more common,” the GSMA said in a 2021 report dubbed ‘Spectrum Pricing: GSMA Public Policy Position’.
According to the study, which was undertaken by Coleago Consulting, the total cost of 5G deployments per city, for instance, would jump by between US$782million and US$5.8billion for areas where there is a deficit of 800MHz to 1000MHz spectrum.
These outcomes, the GSMA warned, will undermine consumer mobile services and the wider digital economy.
“The issue is especially problematic in developing countries, where spectrum prices are on average three times higher than in developed markets once income is taken into account,” it stated.
Spectrum is a valuable state asset and governments have the option to use it in raising revenues to fund vital state activities.
However, the primary goal in all awards should be to encourage the most efficient use of spectrum through investment in widespread, high-quality networks, said some industry players who spoke on condition of anonymity.
They further argued that efficient spectrum awards maximise access to affordable mobile broadband services, which in turn have a major impact on the digital economy.