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RoW: Hope rises for cheaper internet access in Nigeria

With the recent declaration that all the 36 states of the federation have been mandated to slash Right of Way (RoW) charges by at least 96 per cent, the hope of cheaper and more affordable internet access is now higher in the country. If the states go by their promise, this also puts the country’s 90 per cent broadband target on course. SAMSON AKINTARO reports

The Minister of Communications and Digital Economy, Dr. Isa Pantami, last week, addressed the concerns of telecommunications operators over their fate in the remaining 29 states after seven states had announced reduction and waiver of Right of Way (RoW) charges. From the minister’s assurance, compliance with the recommended N145 per linear meter is no longer a matter of choice, but of a commitment to an agreement signed by 34 out of the 36 states governors at a meeting held earlier this year.

As a mark of his confidence in the agreement, the mqinister at a forum of telecom players had told the operators to resist any attempt by any state government to charge them more than N145 per linear metre of RoW. RoW charges are government levies imposed on telecom companies and internet service providers (ISPs) to lay fibre-optic cables along state roads. Until May this year, most of the states were charging telecommunications operators as high as N6, 000 per linear metre, for Right of Way, while the average charge across the country stood at N4,000. This was in spite of a 2013 recommendation of N145 by the National Executive Council (NEC) to fasttrack infrastructure deployment.

Engagement with governors

Before the launch of the country’s second National Broadband Plan (NBP 2020-2025) earlier this year, the RoW challenge had been identified as a major obstacle to the country’s dream of achieving ubiquitous broadband. With an ambitious target of 90 per cent penetration by 2025 from the current 40 per cent, it became more imperative for the government to tackle the behemoth of RoW charges first.

This was why Pantai led a delegation of the ministry officials and telecom operators to the Nigerian Governors’ Forum (NGF) early this year. At the meeting, Pantami said he had made the state governors realise the economic benefits of broadband penetration to their respective states, adding that the gains were far beyond what they realise from taxes and charges. The outcome of the meeting, according to the minister, was an agreement that all states should review their charges downward to N145, which the Federal Government had recommended in 2013 to fast-track broadband infrastructure deployment. But while the industry players are worried that only seven out of the 36 states have so far announced compliance with the N145, and in some cases, a complete waiver of the RoW charges, the minister, at a virtual conference organised by the Association of Telecommunications Companies of Nigeria (ATCON), said the agreement to slash the RoW charges was binding on all the 36 states of the federation.

“I must clarify that the Right of Way charges reduction is beyond the seven states that have so far announced their decisions. We have a consensus at the Nigerian Governors’ Forum meeting and it is automatic for all states and I will say that the announcements so far made are just at the discretion of the state governors. “At least, 34 states were represented at the meeting and none of them challenged the agreement we had. If any state insists on charging more than the agreed price, the telcos should resist,” the minister stated.

Reducing operational cost

According to Pantami, the engagements with the governors were prompted by the complaints from telecom operators that 70 per cent of their investments were going into RoW charges, a development that could discourage investors from investing in the country’s broadband project. He said with the intervention, the operators would now pay less across the country. Citing an example from one of the states that had slashed their charges, the minister disclosed one of the operators who was initially asked to pay a sum of N560 million to lay cable in an area in Kwara State has now been required to pay only N150 million. Ekiti State had set the ball of uniformity rolling in May when it announced a reduction in RoW charges with a 96 per cent slash from N4, 500 to N145. Since then, three states, Katsina, Imo, and Plateau, followed suit. Kaduna and Anambra, on the other hand, completely waived charges altogether, while Kwara dropped it to N1 per linear metre.

Hope for data price reduction

While the reduction in the cost of RoW is expected to fast-track the deployment of broadband infrastructure across the country, stakeholders, including the telecom operators are confident that the internet users in the country are bound to enjoy reduced cost of access. Before now, the high cost of data in Nigeria has been blamed on many operating challenges, chief among which is the high cost of RoW. However, with the 96 per cent reduction in some states and expected compliance by all other states of the federation, the impact of the reduced operating cost is expected to trickle down to the consumers in the sector. According to the Alliance for Affordable Internet (A4AI), a body working to reduce the cost of internet for citizens globally, Nigeria has taken the boldest step to achieve affordable internet for Nigerians with the RoW charges reduction. The body said this move would bring significant change to drive down the cost of broadband in the country. Highlighting other benefits that are accruable to states that adopted and implemented the harmonised Right-of-Way price, the Association of Telecommunications Operators of Nigeria (ATCON) had noted that this would help in unlocking the inherent digital potential of these states. “These states are set to enjoy and maximise the opportunity that pervasive broadband penetration can offer as the people of these states can now leverage on uninterrupted telecommunications services which they have not been enjoying before now. The reason for this is that telecom infrastructure would give them the opportunity to express their gifts and talents,” the telecom body stated. ATCON added that the reduction in price would also lead to fast-paced development enabled by robust Telecom and ICT Infrastructure. “The direct multiplier effect of this pragmatic action is that these states will experience a noticeable development both in the private and public sector, which is expected to push the revenue of these states forward and it will also make companies that do not have a presence in these states to consider opening a branch in the state which will lead to employment generation thereby reducing rural-urban migration,” the telecoms body said.

Boost for InfraCo project

For the Nigerian Communications Commission (NCC), with the reduction of RoW charges by states, the coast is now clear for the take-off of the long-planned infrastructure project. This, it said, would allow already licensed Infrastructure Companies (InfraCos) to roll out services across the country. Everything that is needed to commence the infrastructure projects in the various zones, have been done, and very soon the Minister of Communications and Digital Economy, Dr. Isa Pantami will provide the exact time that these projects will kick-off. Danbatta said with the reduction in RoW charges, InfraCos were expected to help address the challenges of fibre deployment in towns and cities and assist the country to achieve ubiquitous broadband. Danbatta explained that the commission would not rest on its oars for speedy rollout of services by the InfraCos to ensure available, affordable, and accessible broadband across the country. InfraCos have been licensed for the past four to five years, but have been burdened by some state policies, especially RoW tariffs, in rolling out services. Currently, NCC licensed six InfraCos in all the six geopolitical zones of the country, except that of the North Central Zone, that was initially registered, but the company had to return the licence to NCC for its inability to roll out services as a result of rollout challenges, which include high RoW charge.

Last line

While seven states have so far implemented the agreement signed at the NGF meeting, it is incumbent on the remaining 29 states to do so to realise the objectives of the harmonised charges. Aside from the expected reduction in the cost of data for Nigerians, this will, no doubt, attract more investors to the country’s broadband project.

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