Wednesday, June 10, 2009

How not to rebrand Nigeria’s telecom industry

The recent face-off between the Ministry of Information and Communications and telecommunications regulator, Nigerian Communications Commission (NCC), over 2.3 GHz, may have left stakeholders wondering if controversy has become a tool for the rebranding endeavour of current government, writes REMMY NWEKE.

A search on ‘rebranding’ on the popular search engine,, would spring up with results of about 3,060,000 on ‘What is rebranding.’ And according to experts at free online encyclopedia, Wikipedia, rebranding is the process by which a product or service developed with one brand, company or product line affiliation is marketed or distributed with a different identity and could be individually or corporately marketed.

This may involve radical changes to the brand’s logo, brand name, image, marketing strategy, and advertising themes. These changes are typically aimed at the repositioning of the brand itself, generally in an attempt to distance itself from certain negative connotations of the previous branding, or to move the brand upbeat in a given market.

Therefore, rebranding could involve new products, mature products, or even products still in development. Also, the process could take place intentionally through a deliberate change in strategy or occur unintentionally from unplanned, emergent situations, such as a corporate restructuring.

DML auction, beginning of rebranding Nigeria:

However, in the case of Nigeria, most experts agreed that the nation’s rebranding overtly started with the globally acclaimed transparency in the Digital Mobile Licensing (DML) which commenced in December 2000 with the first batch of five companies fulfilling the payment requirement of $20 Million US Dollars and were therefore qualified to proceed to the auction stage proper.

The auction lasted for three days, between 17 and 19 January 2001, with three companies emerging as winners for the three licenses; namely MTN, Econet now Zain and CIL, while the controversial Nigerian Telecommunications (NITEL), now moribund, which had its own license as the first national carrier. The winning bid price for the successful companies was $285million, which was announced as the license fee to be paid within the fourteen (14) business days as stipulated in the information memorandum.

Thus, making it four companies in total that were issued letter of provisional award of license and given fourteen (14) business days within which to effect payment after which the license would be confirmed. At the close of the 14 days only three companies met the payment obligations on time and were therefore issued the final licenses.

One remarkable thing about the process was that the fourth company, CIL is a Nigerian company which has since transformed into Globacom and now laid siege to other licenses including the SNO, which offers it the suite of licenses it has today.

Most industry stakeholders opined that for NCC not to have compromised for the sake of a Nigerian company was absolutely unique for a Nigerian institution. Hence, this single step earned the telecom regulator, accolades both locally and internationally as well as from the global telecom regulator, the International Telecommunication Union (ITU).

Therefore, most analysts in the industry today see this sole step as the beginning of rebranding Nigeria and given experts definitions as aforementioned, it could be summed up that NCC as expected has been a change agent in the development of this country and ever since then has continued in this arena till the latest shuffle at the Federal level.

It follows that the unassuming ‘war’ invariably broke up between the Ministry of Information and Communication and NCC, forcing stakeholders to ask ‘What actually went wrong’?

Like play, it commenced few days after the ministers were assigned portfolios and the telecommunications got the hitherto amazon of anti-fake drugs agency, NAFDAC, Prof. Dora Akunyili on the saddle, with professionals opposing and counter-opposing the appointment. And like the ministers before now, she has Dr. Ikra Bilbis, who was described as a ‘fine gentleman’, as the minister of state.

Akunyili’s New Year desire:
And before some stakeholders could spell JACK, Akunyili summoned them to a one-day forum in January, also tagged as her New Year gift; which was largely rated as ‘charade.’ She used that platform to make pronouncements on the need to reduce tariff and one of the chief executive officers, among the leading GSM operators, who attempted to explain and enlighten the participants including herself on the process that could lead to her heart desire, was literally shouted down in the name of making a ‘political statement.’ This attitude no doubt set the operators on war path with the minister.

Although, it was assumed that probably, the NCC has not briefed the Minister enough, according to the Association of Telecommunications Companies of Nigeria (ATCON) in its reaction to Akunyili’s quest for tariff reduction, barely weeks in office without looking at other affiliate issues that could make that visible, namely power supply, security and even poor road infrastructure to name a few.

NCC must brief Akunyili often:
ATCON National President, Dr. Emmanuel Ekuwem, responded by tasking NCC, as matter of urgency to ensure it briefs the Minister more often, so as to position her for the challenges ahead. Noting that they are excited on her enthusiasm and keen interest to move the industry forward, but quickly reminded her that her role has now changed since she assumed office as the Federal Minister in charge of Information and Communication. They advised her to play according to the rules by being aware of her limits. That way, he said, there would be harmony and peaceful co-existence among the industry players including between her ministry and NCC as well as the larger stakeholders.

Pointing out that at NAFDAC, she was a regulator and now, she is a minister. “Presently, she is not a regulator as far as telecommunications is concerned,” he asserted, advising the ministry to focus on making relevant policies that would enhance the state of things in the country.”The ministry should not co-regulate telecom. The turf of regulation is on NCC, while policy making rests on the ministry,” he said, stressing that this points needed to be clarified because of what ATCON observed at the just concluded stakeholders’ forum held in Abuja.He insisted that ATCON believes NCC did not brief the minister adequately, otherwise, things should not have tilted toward mere consumer-based discussion at the stakeholders forum, rather than how to improve the industry holistically.

Like CIL, like Galaxy Wireless:
Soon after and precisely in March this year, NCC in its own wisdom appointed two firms, Detecon International and Price Water House Coopers, as consultants and advisers to the Commission for the review of current interconnection rates among telecom service providers; to analyze the cost of interconnect rates presently with the objective to further drive down the tariff across board, but like the proverbial, second wife in a polygamous family who will prefer to ask her colleague to give her palm oil to enable her chew palm-kernel, Akunyili, against all the gains outlined by notable expert groups like the Nigeria Internet Group (NIG) on the modalities for auction 2.3 Gega Hertz, found fault with the process and insisted on cancellation of the process, simply because Galaxy Wireless, purportedly owned by the Madueke’s was not successful, then she forgot that there were other licenses yet to be auctioned as the market expands.

Part of her argument was that the five working days given for payment was too short, frequency hullaballoo and other claims which have since been punctured given the overwhelming evidence, especially that NCC leadership was not supporting her clamour for tariff reduction and legal implication of the cancellation, cannot be compared with the consistency that has existed before her, if the initial winners in the 2.3GHz – Multi-Links Telkom Limited, Mobitel Nigeria Limited and Spectranet Limited pursue their licenses to the letter as being threatened.

Listen to NIG:
NIG had barely finished commending NCC over the granting of the latest three licenses on 2.3 GHz), describing the process as ingenious, when the cancellation news hit the wave. According to its president, Mr. Lanre Ajayi, for NCC to have been able to peg the price of this frequency and yet conduct a transparent sale is inventive and deserves commendation.

Auctioning such a frequency, he said, is an easier process because the spectrum, which is a limited resource but desired by many, will simply go to the highest bidder. But this may drive broadband Internet out of the reach of many Nigerians. On the other hand, by pegging the cost is more challenging, since it is more difficult to select who should have it out of 40 contestants.

“Pegging the cost of spectrum is certainly a way of lowering the cost of broadband Internet to Nigerians and guaranteeing deeper broadband penetration in the country,” he said recalling that the group has been on the vanguard of a low cost of spectrum for broadband Internet to accelerate broadband penetration in Nigeria.

“We are glad NCC has been able to accomplish this,” he said, noting that many countries of the world are still subsiding broadband Internet to their citizens, Nigeria government should not over burden her own citizens by over pricing the cost of broadband spectrum.

“We applaud the outcome of the process. With this development, Nigerians should brace up for explosive e-Education, e-Health, e-Commerce, e-Government, and other e-Services which ride over broadband Internet,” NIG president said.

Policy summersault:
Stakeholders in the nation’s Information and Communications Technology (ICT) equally rose from a forum pen-ultimate week in Lagos, to condemn the Federal Government’s cancellation of the recently concluded licensing of 2.3 Gega Hertz (GHz). They frowned at the controversies which have characterized the exercise, arguing that the cancellation eroded the independence of the regulator, NCC.

The condemnation came on the heels of the disclosure that Mobitel Nigeria Limited, one of the 2.3GHz awardees has perfected plans to drag the Federal Government to court over the cancellation, and NCC confirmed receipt of a letter from its supervising Ministry, conveying the cancellation of the concluded bid, which it strongly advised against.

Reacting to the cancellation at the 4th annual forum, stakeholders including ATCON and NIG among other players in the sector, decried the FG decision, saying that it begets bad omen for the country.

The decision, Ekuwem of ATCON said creates uncertainty in the sector, which could be singled out as the only shining light of the nation’s economy in the last decade. Stressing that ATCON would like to get to the root of the matter, because it is very crucial to keep intact the positive image of the country for continuous investment inflow.

NIG president, Mr. Ajayi, described the news of the cancellation as “devastating and stands as the worst policy summersault Nigeria ever had in recent times,” stressing that a country like Nigeria with instability of policies cannot be trusted by any investor. Citing an instance with some of those three that were successful with their licenses, he argued that most of them may have received backing from international consortium of investors or bankers, hence, the cancellation amounts to scaring investors not only from the sector and also from the country.

“Government is scaring investors,” he said, pointing out that it is a mess of the nation’s Communications Act of 2003, from where NCC drives its powers, especially that of independence, which is now being eroded by the political class.

And the consortium may have started counting their interest from the date they got the loan facilities and are not likely to wait till when government completes the resale of the spectrum.

Therefore, political leaders in the country and of Igbo extraction particularly, must learn to live above their oath of offices and avoid using same to tarnish their brother’s image publicly for personal aggrandizement; be it for governorship or not.

Though some analysts had opted that the south-east governors is a bunch of disappointment as they could not rally round to qualm the controversies between the two federal agencies being presided over by their son and daughter, especially Mr. Peter Obi of Anambra State; from where the two distinguished personalities hail from, yet another school of thought described the entire episode as ‘ego battle.’
It is high time for the expert groups of Ohaneze Ndigbo to wake up to its responsibilities. It is not enough to have their people on saddle of leadership and then forget them there.

Above all, what becomes of the NCC independence is yet to be known as the political class continues to fan their way into industry regulations, which in all ramifications is not how to rebrand a nation like Nigeria, which is in dire need of leapfrogging its development, which former president Olusegun Obasanjo, held close to heart as key of democracy dividend.

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