Engineer Titi Omo-Ettu, president of the Association of Telecoms Operators of Nigeria (Atcon), is one of the few engineers who has seen it all especially in the context of the evolvement of telecommunications in the country. He spoke to BUSINESSWORLD’S team of editors recently on various industry issues.
Accepting the Call to Serve
I actually accepted to serve as the president of the Association of Telecoms Companies of Nigeria (Atcon) because of the need of those of us who call ourselves stakeholders to contribute to the growth of the industry. We can also say that we are the elders of the industry as far as telecoms is concern, reason being that three of us were part of the liberalisation process and have been following liberalization up to date. We were clearly satisfied with the result that we got with the efforts that we put in, except that we also realised that all hands also had to be on deck because the 10 years of Ndukwe that came with the Nigerian Communications Commission (NCC) has just expired.
We saw that the Yar’Adua/Jonathan government had not responded to all our push for some things to happen and we had made up our minds that we are going to wait for the next government. It was at that time we saw ourselves as independent of the government and NCC. It was also at that time the Yar’Adua government revoked the licence awarded by NCC, the 2.3 GHz spectrum licence. We felt we should encourage the licencees who had the locus standi, and fortunately the court ruled in favour of those who thought the laws should be what it was.
To that extent, I should say that at that time, we had to hold the industry for the better. I might not have been worried. The issue between the minister as at that time and Ndukwe were not strategic issues, they were personal. That was the time pressure was mounted on me to be president of Atcon, and that was exactly the third time I would be called to be president of Atcon. I had to accept as I thought that was necessary. The industry I met was an industry that was shaking, in fact our flight was running into turbulent weather, the quality of service has been going bad for quite some time, and that was the time we felt that Atcon should be strategically positioned so that we can use it to strategise for the future and to arrive at where we are today. We did so much work to put the industry the way it was, to be structured in such a way that Atcon would not depend on the president and that it should be run with its own rule, so that the president will only provide the leadership and that is the reason we are doing some of these things we are just doing.
In the past three months, we have put up some frameworks we had never done before. One of them is collaboration and endorsement. As a matter of fact, if I spend two years and set up these frameworks properly, that would have been enough.
I came in at a time that if I had not come, I won’t have come in anymore, because in another five years, I will be going back home. I spent my first 17 years in the village and want to spend 50 outside. After that, I will go back to my village. So, the industry I met was the one that was getting shaking and I am sure we will bring it back.
The quality of service has been so bad that I was unable to make call for several hours recently on a Sunday. May be due to network maintenance, the operator has to shut down the system from 4 pm till around midnight when there was less traffic. I was just waiting for the following morning and I know that if by morning, I am not able to make call, then there is crisis. So by the morning, I was able to make call which made me to feel that some of them where making critical maintenance on their networks. This means that any time the operators want to carry out such maintenance, all the experts must be around to ensure that it doesn’t exceed six hours, and if it is twice in one year, it is okay for an environment that is not one of the best.
Engaging the Government
When I came, I said we would use communication to move the industry forward. We would communicate effectively with ourselves, that is, the players and telecoms companies. We would communicate also with our customers, the consumers; we would communicate with the government. When we started, the one we forgot was the legislatures, until we realised that another key sector was the legislatures, but now we have brought them in. We have started communicating with them and I can say, for example, we have to look at some bills with them.
Ndukwe’s Tenure as EVC
Well, we were always in perfect communication. There was no time that we left him to go alone. Some of the errors he made, we are likely to bear responsibility and some of the successes he made, we can also claim the credit.
Ernest Ndukwe meant very well as he had a clear vision as to where he was taking the nation to. Fortunately for him, he didn’t have problem with those of us in his constituency. We were communicating, we were quarrelling with him. For three years, for instance, we were almost on war path and certainly after some time, we called ourselves and said why are we quarrelling? Well, it’s because we want Nigeria to be better. Sometimes you want to take a decision and everybody brings his own idea, you won’t take everybody’s idea. You will only take one or two and when you finish, somebody would think his own idea was not manifested and he can show his anger in various ways. Those quarrelling with him felt they were ignored, they were not involved economically and they were ready to bring him down. Fortunately, he survived it. Ndukwe did his best and some of the errors he made because he was listening, he corrected them. One of them, for example, was the issuing of GSM licences. It was done in error by our standard. Some of us did not agree that we should have allowed those who bided for GSM to have paid so much. We felt we should have moderated it, so that the cost of sales won’t be too high. I personally thought that any thing above $150 million is good, but by the time we finished the auction, it was very clear that the bid was too high.
When the idea of N40 per minute came up, it was too much as we can’t justify it with the per capital income of Nigerians. There was no way we could justify it. But then, when the Second National Operator was to come, we criticised it that it should not come at that time; although they have taken their decision.
So, Ndukwe, in his magnanimity, did well. He kept on listening to us and kept on doing what he felt should be done. When he was going to do the Second National Operator, it was at a give away price because you cannot compare it with GSM licence. Today, any time I argue that the First National operator licence is worth $2 billion, I expect people to say when we were giving Second National Operator for $200 million were you not in Nigeria?
Yes, I was in Nigeria and nobody has asked me that question and I expect it to come some day, when it comes I will say yes, the fact that we made error that time doesn’t mean we should continue to make error. This is because the First National Operator licence is a licence that would enable you to do all things and it is a big deal. As a matter of fact, we thought having given Second National Operator licence to Glo at that time; we could have stopped Glo from executing the GSM licence. This would have enabled it to concentrate on building infrastructure. Glo got the licence to lay fibre across the country and since then it has been laying that fibre but I am sure it must have been using it for itself. Then, if you are doing GSM as a First National Operator, you are only competing with your customer because other operators are supposed to rent infrastructure from Nitel.
I thought that we should have stopped Glo from executing the GSM licence. If you stop Glo from executing the GSM, it would have no choice but to concentrate on laying fibre and the cost of fibre won’t be as high as it is today. And having run into all those problems with the First National Operator, the only thing we should do now is to sell Nitel at good value. The good value to me is to see that we have all the condiments of the First National Operator intact. In fact, the First National Operator may not be giving telephones to subscribers. Anybody who buys Nitel, in my opinion, should provide infrastructure, nobody is doing that business now. Glo is supposed to be doing it but I don’t know how far it has gone but has been laying fibre for the past six years, there must be something it is doing and making money out of it.
Nitel as the First National Operator is still viable. It already has all the right of way in the country. Right of way is the dot all around this country where you can put fibre and that is huge money.
Of course, it is what you buy that you sell. What Nitel have that many people don’t know, first of all, is the right of way. From Ikrodu road in Lagos through Ibadan to Kano, Kaduna, everywhere, Nitel already has the right to put cable. As an operator, if you get a licence and you don’t have that, the issue of getting the right of way is a big one in the country at the moment. If they make the mistake of giving that one for peanuts, it will be at a great loss. First National Operator licence is critical. It will give you the chance to lay fibre across the country. If you have that, it is a lot of money. People would come and rent that right of way and I am sure many of the operators might have rented some from Nitel.
Then, the fact that Nitel is the carrier of carriers is a big deal. If not the fact that Nitel didn’t do well, NCC should not have given licences to those nine metropolitan operators, but because Nitel was not there to play its role and I praised NCC for taking that decision.
Telecom as a Big Business
One thing I have noticed in Nigeria is that the way we do telecom in Nigeria is small. Unfortunately, all those who are doing telecoms in small scale would end up dying. I can not explain it, but I feel that is what is going to happen. One would have thought that when you are doing telecoms, you start small and grow big.
I have not seen those who started small and are still in the market today. Many would say the CDMA are not doing well, but I don’t think so. It is because most of them started as regional operators, and you have to study why things are happening like that. It is not as if I know, but that is my observation.
I have a client who wanted to do telecom business and I told him to be careful because of his plans to start small. I gave an example that once you start small, you don’t grow in Nigeria; and so, it is better you start from the top. Why is this so? I don’t know. I can imagine that more CDMA operators may have problem because of their sizes.
Telecom and Nigeria’s GDP
I want us to know one fact that all we have been reading about telecoms may not have been correct. There might have been mistakes somewhere. We have been getting figures that were not actual. I am trying to take the ones that we should know because there are some things that when we say, they become issues and that won’t be good for the industry.
I, for example, don’t believe that we have 81 million lines, but who am I to say no. I know when you are publishing information about your business; first you may want to show your shareholders that you are doing very well. Second, you want to place yourself in a position in the business. You can also cook up figures in order to take a lion share of what is in the business. There are many reasons for this.
I have questioned the figures which operators were publishing. Things are not as rosy as they say it is. They declare some profits and they pay tax on the figures and sometimes they are ready to do that to cover themselves. If you see how telecoms companies run their businesses, what accrues to managing directors would encourage him to cook figures. And we know of many companies that had cooked figures in this country, not telecommunications. At least we know of Cadbury. I was a consultant to NCC for so many years and I didn’t agree that operators should be allowed to publish figures. I have always quarrelled with it, and when operators say they have 3,000 lines, for instance, what I expect was that the regulator comes in to verify and whatever is found should be published but in most cases that is not so. The operators just give the figures that are used by the regulator.
An Agenda for Juwah
If I have an agenda to give to Juwah, the new executive vice chairman of the Nigerian Communications Commission, I will talk to him directly because I have access to him and there is nothing I think he should do that I have not told him. He is in a position to see all. He has all the instruments. I may be seeing the wrong thing, he may not see the right thing but sometimes he may even see the right thing and the system may not allow him to see the right thing. What has happened in the past 10 years is that we have opened up and having really opened the industry, we were not really regulating well. This is the time for us to do real regulation.
On frequency management, we have to build up expertise in that area as long as we have to allocate frequency. The ministry has seen it; the Nigerian Broadcasting Commission (NBC) and the Nigerian Communications Commission have seen it. Greater attention must be paid to frequency management to bring about necessary development.
When you run a broadcasting outfit, you are likely to pay bills that ought not to be paid for. The president of Alton, Gbenga Adebayo, recently set up an internet radio station and must have probably got his licence from NBC. He is doing an internet communication and will get the other licence from NCC. All of these will translate to how he sells his product, and would it not have been better if he gets his licence from one source?
Recently, when I was with my daughter in London, I noticed that her television set, her internet and telephone were working together, because when the telephone rang, I saw a number displayed on the television set and because I know I was in an environment that there is convergence, I know that these people know what they are doing. I asked my daughter about the telephone and the television and how they work. She said she just went to a shop and they came and fixed everything for her as one package. This means that when you buy your television set, the internet and the telephone are packaged together. That is convergence. In our own case, I will go and buy my LG television set, I will still go to MultiLinks or Starcomms to buy internet access, Glo to buy my telephone and I will be dropping money in each of the places. The man who gave my daughter all the systems simply got one multimedia licence, and the question is who gives multimedia licence now, is it NCC or NBC? We have already written a paper about this, the unification, which will eventually end up merging the two organisations.