Gsm Revolution in Nigeria

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THREE YEARS OF GSM REVOLUTION IN NIGERIA

By Ernest C. Ndukwe, Executive Vice Chairman, Nigerian Communications Commission (NCC)

INTRODUCTION
♦ Telecommunications is acknowledged as

one of the most important infrastructures essential to the socio-economic well-being of any nation. ♦ The globalisation of world economy has further amplified the importance of telecommunications to the economy. ♦ The Telecommunication Sector is one of the fastest-growing sectors, and in terms of capitalization. 24/05/2006 2

INTRODUCTION – CONTD.
♦ Government recorgnised the importance of

telecommunications for the socio-economic development of the nation. ♦ The phenomenal growth of GSM since it was introduced in Nigeria less than three years ago confirms this. ♦ GSM is indeed one of the major dividends of Nigeria’s transition to democracy.

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THE ENABLING ENVIROMENT THAT MADE GSM A REALITY
♦ Making the right choice of technology ♦ Taking timely decisions ♦ Consistent and predictable regulatory policy

on the part of government ♦ Transparent award process used by the regulatory authority ♦ A large ‘ready-made’ market 24/05/2006 4

DIVIDENDS OF GSM REVOLUTION
♦ Foreign capital inflow ♦ Stimulation of local investment ♦ Increased access to telephony services ♦ Job creation ♦ Indigenous skills acquisition and

technology transfer

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DIVIDENDS OF GSM REVOLUTION – CONTD.
♦ Revenue generation in licence fees of over

$1.1 billion USD ♦ Economic empowerment of local population ♦ Phenomenal increase in Nigeria’s teledensity within three years ♦ Increased tax-revenue for government

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STATISTICAL INDICATORS.
The following are approximate data relating to GSM deployment in Nigeria in the first three years. ♦ Private Investment of over $4 billion ♦ Total number of lines connected to subscribers: over 3.8 million ♦ Improved national coverage of cities, villages and highways 24/05/2006 7

STATISTICAL INDICATORS contd.
Dec-00 Number of Connected Fixed Lines Number of Connected Digital Mobile Lines Number of National Carriers Number of Operating ISPs Number of Active Licensed Fixed Line Operators Number of Licensed Mobile Operators Dec-02 Jun-03 Dec-03 Mar-04

450,000 None 1 18 9

702,000 1.6m 2 30 16

724,790 2.05m 2 30 19

850,000 3.1m 2 35 30

888,854 3.8m 2 35 30

1

4

4

4

4

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STATISTICAL INDICATORS CONTD.
♦ Employment generation

– – – –

Direct Employment: over 5000 Large number of franchised dealers nationwide Estimated indirect employment: over 400,000 Nigerian ICT professionals being attracted home

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BACKWARD LINKAGE EFFECT.
♦ Increase turnover for advertising and

marketing services ♦ Increase in e-commerce and e-banking services ♦ Increase banking sector turnover through loans and advances ♦ Astronomical increase in traffic volume for other private telecom operators ♦ Contribution to Nigeria’s GDP: 1-3% increase 24/05/2006 10

CHALLENGES
♦ LEGACY ISSUES

– Weak Infrastructure base – Unusually huge demand for services due to inefficiencies of the past – Spectrum Planning & Allocation problems – Enabling Laws and Regulations limitations – Unreliable Electric power supply

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FUTURE CHALLENGES
♦ Ensure competition in all market segments ♦ Improvement in quality of service ♦ Improvement in supporting infrastructure

such as power and transmission facilities ♦ Decrease in network congestion and interconnectivity bottlenecks ♦ Enforcement ♦ Managing consumer expectations 24/05/2006 12

FUTURE CHALLENGES – CONTD.
♦ Maintaining favourable regulatory and

investment climate ♦ Cheaper internet access ♦ Expanding broadband services ♦ Rural access ♦ Local manufacturing

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CONCLUSION
♦ TWO YEARS OF TELECOM SECTOR REFORM HAS

BROUGHT ABOUT ? Improvement in Investment Climate ? Increase in number of market players ? Unprecedented Growth in...
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