Nigeria: NBC’s sale of 4G spectrum to MTN, the questions that will not go away…

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The controversy swirling round the sale of 4G spectrum to Nigeria’s leading operator MTN just won’t go away. Indeed there is a danger that it may yet find itself at the centre of the troubles engulfing the broadcast regulator NBC who it bought the spectrum from. Russell Southwood returns to the fray to try and sort noise from signal.

In issue 810 (Nigeria’s top broadcast regulator arrested over 4G spectrum sale to MTN – Three questions needing answers - See more here:  we wrote about the arrest of NBC’s Director-General Emeka Mba. Since then Mba has been released but the controversy rumbles on.

Mba was released 8 days after his arrest and the news surfaced in a What’s App message from his supporters. It was shared by Igwe Gabosky, the CEO of G-Media and was sent by film maker Madu C. Chikwendu and it reads: ‘Breaking News: With great pleasure I inform you that Mr Emeka Mba has been released by EFCC (Nigeria’s anti-corruption agency). I thank all that were willing to stake their names and money: messers Fidelis Duker, Tajudeen Adepetu, Charles Novia, Barr Norbert Ajaegbu, Igwe Gabosky, Sola Fajobi, Ossy Affason and others too numerous to mention- Madu C. Chikwendu.’

Nevertheless fundamental questions remain unanswered so far. There appears to have been no public and transparent formal bidding process for the spectrum sale. In other circumstances when telecoms regulators sell spectrum, there are a publicly available set of bid documents and the results are clearly signaled on its website. Although we have conducted a thorough search of NBC’s website, we cannot find documents of this kind and there were no public announcements prior to the sale.

Since the last story I wrote, I have spoken to the ex-Director General of the broadcast regulator, NBC Yomi Bolarinwa and he was very clear about NBC’s powers:"It is not within the powers of NBC to sell spectrum to telecoms operators. You can licence them to carry broadcast but you cannot assign them spectrum. They are not broadcasting."

But according to This Day, the Director General of NBC, Emeka Mba, said that the spectrum was sold at a time when it was still under the control of NBC, and that NBC sought and received approval to raise money to pursue its Digital Switch Over (DSO) mandate by licensing commercially a portion of the spectrum for converged services use from the previous Government. (our emphasis) Mba said the licensing was handled transparently and was done as part of its convergence service.

According to a report in Information Nigeria, NBC maintains that it obtained approvals from the (outgoing) Federal Government and the Frequency Management Council.

If there was uncertainty about who was responsible for selling the spectrum, presumably that would have appeared when MTN carried out its due diligence on the transaction.

According to Amina Oyagbola, Corporate Services Executive, MTN Nigeria:” “MTN’s transactions always follow due process and this is why the purchase of the 700 MHz spectrum from the NBC was concluded after obtaining the necessary approvals.” He also denied that the spectrum had been returned to NBC after the controversy erupted:” The reports that the spectrum has been returned are inaccurate.”

The telecoms regulator NCC has also challenged the transaction. According to a report in Information Nigeria, the Executive Vice Chairman of the Nigerian Communications Commission (NCC), Prof Umar Danbatta, has said that the National Broadcasting Commission (NBC) should not have sold the country’s 700MHz Spectrum to MTN Nigeria because it is telecommunication spectrum that is very important for broadband deployment.

“NCC will not publicly engage NBC, even though it is under a different ministry, because we don’t think it is the right approach. The Frequency Management Council, which is a very important organ of government that has a representation from the Federal Ministry of Science and Technology as well as the Communication Technology Ministry, will look into the matter,” Danbatta said in a statement released by the NCC.

“We intend to avail ourselves of existing mechanism for arbitration and mediation through the Frequency Management Council,” he said. “The upper range for broadcasting is 694MHz that will free the 700MHz spectrum for use to facilitate communication services. That is the approach we intend to adopt to resolve the matter and I have spoken with the NBC on this and they have expressed readiness to come to the Commission to talk about it so that we can together be able to fashion out a way forward that will be devoid of any acrimony or rancour which normal Nigerians are used to when issues of this nature come up,” Danbatta said.

On 16 January an unnamed top Government official told Peoples Daily of the possible cancellation of the spectrum sale following the ongoing probe into the activities of NBC.

In the same report, NCC’s Executive Vice Chairman Prof Umar Danbatta also told journalists in Abuja that the Frequency Management Council would soon wind up its review and make the outcome public. He said: “The Frequency Management Council has indeed intervened and the sale is being revisited and very soon the Nigerian public would be informed about this very important intervention.” Coming up to two months later and there is still no sign of that report.

The three questions raised in our original story remain unanswered:

1. What is Nigeria’s policy approach to the roll-out of 4G that would set the framework for any sale of spectrum?

With a clear and public policy on 4G spectrum sales, it is unlikely that a regulator would sell that spectrum to only one of the bidders.

2. Why is there no clarity about which organization is responsible for allocating spectrum in Nigeria?

Whether or not NBC received authorization for the sale, there is something fundamentally strange about a broadcast regulator selling spectrum to a telecoms operator in the twilight moments of the outgoing government.

3. Why was a clear and transparent public tendering process not put in place to sell 4G spectrum to those who might wish to invest in the provision of these services?

If it came to pass that MTN alone among mobile operators was the first and/or the only mobile operator to roll out 4G, it would clearly have an unfair competitive advantage.

Whether or not it intended to, MTN has now got itself locked into another controversy that may yet add to its woes in Nigeria.

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