The federal government has set its eyes on N862 billion market opportunities that would be made available through the auction of Digital Dividend Spectrum licence, which would enable telecom operators to speed up broadband rollouts with less telecom infrastructure as well as create electronic commerce and a cashless society.
The Digital Dividend spectrum is released in the process of digital television transition. When television broadcasters switch from analogue platforms to digital-only platforms, part of the electromagnetic spectrum that has been used for broadcasting will be freed up because digital television needs fewer spectrum than analogue television.
The Digital Dividend spectrum is located between 200 MHz and 1GHz. This spectrum band offers an excellent balance between transmission capacity and distance coverage.
Because of its good signal propagation characteristics, fewer infrastructure is required to provide wider mobile coverage, meaning that communication services can be provided in rural areas at lower cost by broadband service providers in Nigeria.
The executive vice chairman and chief executive officer of the Nigerian Communications Commission (NCC), Dr. Eugene Juwah, hinted this at the Nigerian Broadband Investment Dinner organised for investors at the just concluded ITU World 2011 hosted by the International Telecommunications Union (ITU) in Geneva, Switzerland.
Mrs. Omobola Johnson, minister of communications technology, who urged investors to avail themselves of the opportunities in Nigeria’s telecom market, said the government was ready to collaborate and partner with investors in privatizing information and communication technology (ICT) infrastructure.
She stated that government is making ICT a key facilitator in Nigeria’s development and expected to use it to propel the economy by 2020, getting its citizens connected to the internet, and ensure food and job security through broadband deployment.
According to the GSM Association, if just 25 per cent, or around 100MHz, of the spectrum currently used by analogue TV (470 – 862 MHz) was re-allocated to mobile communications, the mobile industry could dramatically speed up the rollout of broadband communications and increase coverage. Enormous benefits would ensue around the world, in terms of both social impact and increased productivity, it added.
Nigeria plans to migrate from analogue to digital television broadcasting from 2012 in line with the ITU directive that all nations migrate to digital television broadcasting by the end of 2015. New independent report by analyst firm Analysys Mason on opportunities in Nigeria’s telecom recommended that government should unlock the 2.6GHz spectrum quickly to support the high demand for mobile broadband in urban areas.
It called for the release of digital dividend spectrum to deliver broadband services to rural areas and reduction of the 35 per cent tax faced by Nigerian mobile operators, a tax which is double the global average. The study found that mobile broadband could potentially contribute more than 1 per cent of GDP, or 1.7 per cent of non-oil GDP, as soon as 2015 and will facilitate much-needed diversification of the economy.
According to the report, government support for mobile broadband services could help deliver significant advantages to the wider wireless ecosystem and the way in which other sectors use the internet. This includes 55 per cent annual growth from the online retail industry, growing from N4.5 billion in 2010 to N44.9 billion in 2015.
Others are that the financial services industry would benefit from broadband by 95 per cent compound annual growth (CAGR), as a result of mobile access to bank accounts and money transfer services, from N600 million in 2010 to N16.8 billion in 2015. The use of the internet and mobile to deliver social services, including healthcare and education, would generate growth of 70 per cent CAGR, from N2.2 billion to N30.3 billion in 2015.
It added that the overall corporate market, especially agriculture and utilities, would experience a 55 percent annual growth rate through the provision of services online, from N3.6bn in 2010 to N32.1bn in 2015. Wider availability of mobile broadband could also vastly improve overall industrial productivity through improvements in business processes.
A 73 per cent annual increase in the working population with access to mobile broadband, reaching 5.2 million users by 2015, will deliver an additional N140 billion to the Nigerian economy each year. It is believed that the NCC boss’ statement may have been precipitated by the declaration of the Broadband Commission for Digital Development, which set new targets to enable all populations fully participate in emerging knowledge societies.