MTN’s interest in new $273m 5G-spectrum auction sparks industry fears
The interest of MTN in acquiring an additional Fifth–Generation (5G) spectrum licence is currently causing serious controversy among other operators and stakeholders in the industry.
Other operators and stakeholders who disagreed with MTN‘s move argued that it could make the company a dominant service provider in the country, without considering the development of the telecoms industry.
At the Nigerian Communications Commission (NCC) meeting in Lagos yesterday, on “Stakeholders‘ Engagement on the Draft Information Memorandum (IM) on the Auction of Additional 2 Lots of 100MHz in the 3.5GHz Band,” the issue of spectrum pricing was of great significance.
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The NCC convened the meeting to seek industry input on the planned $273.6 million 5G–spectrum auction. The auction is scheduled for December 19, in Abuja and will offer Lot A (3400–3500MHz) and Lot C (3600–3700MHz). Nigeria has already four 5G licences, with two currently functional. The NCC hopes that by December, there will be an additional two.
The Assistant Director of the Technical Standard and Network Integrity Department of the Nigerian Communications Commission (NCC), Edoyemi Ogoh, read out a response from stakeholders earlier received on the draft IM. In this response, MTN restated its previous recommendations that to ensure that all spectrum can be assigned and used efficiently, it would be appropriate to allow successful bidders in prior auctions of spectrum in the 3.5GHz (or indeed any other spectrum band) to participate in future awards. MTN believes that a cumulative cap of 200MHz in the 3.5GHz would be appropriate across all awards in the band.
Some stakeholders and operators who responded to the question claimed that giving MTN another 5G license would make them a dominant player, which would not allow other players, especially Tier 2 operators, to grow and compete well in the industry.
But in defence of MTN, the General Manager, Regulatory Affairs at the telecommunications firm, Ikenna Ikeme, said the company had entered the last auction in 2021 with the expectation that it was an open market and it would be allowed to participate in other auctions should the need arise.
NCC Executive Commissioner, Technical Services, Ubale Maska said that the telco‘s request isn‘t the first in the telecommunications industry as there are precedents and Nigeria is an open market. He listed USA, Germany, Finland, among others as countries, where such had happened before now.
The Executive Vice Chairman of NCC, Prof. Umar Garba Danbatta, said that all requests will be given due consideration, and that feedback will be given before the auction. He said that the auction process is not about generating revenue for the government
“The motive is not to generate money for the federal government. It has nothing to do with the revenue we are going to generate. The price was determined by the last auction. We will always make reference to the reserve price no matter when the auction was held,” Danbatta said.
The Nigerian Communications Commission (NCC) has said that it will only assign spectrum through open, transparent and competitive bidding. This is in response to Airtel Nigeria‘s request to be granted administrative assignment of spectrum to provide 5G services in the country.
Airtel had argued that its participation in the last bid round in the 3.5GHz spectrum led to boosting Federal Government’s revenue. However, NCC stated that the market price for the spectrum lots has been determined by the last auction.
