… Lists Some Rules Guiding Bid
Following the recent publication of the Draft Information Memorandum (IM) for the auction of the 3.5GHz Spectrum Band, which is to make way for the licencing of the fifth generation (5G) technology, the Nigerian Communications Commission (NCC) has cautioned bidders to desist from engaging in any anti-competitive behaviour that will undermine other operator’s effective deployment of services.
The Commission is offering two (2) Lots of 100 MHz each in the 3.5 GHz band ranging from 3500 – 3600 MHz and 3700 to 3800 MHz for auction. The Spectrum is offered by the Commission on a technology neutral basis for provision of communications service. The Generic Reserve Price (GR) for one Lot of 100 MHz and has a value of One Hundred and Ninety-Seven Million and Four Hundred Thousand United States Dollars (US$197,400,000.00) or its equivalent in Naira at the prevailing Central Bank of Nigeria (CBN) rates at the time of the auction.
The anti-competitive warning, contained in the draft IM published on the Commission’s website, further stipulates that the nation’s telecommunications regulatory body will frown at bidders that make public statements concerning the Auction during its progress. It notes that any confidential information that is submitted to the Commission by Bidders will not be disclosed to other parties unless it is deemed essential to the fair running of the licensing process or required by law. Under these circumstances, full consultation will take place with the affected party.
Some of the confidential information may include items such as business cases, bidding details and bidding strategies. However, all information issued by the Commission in relation to this 3.5 GHz Spectrum licensing process should be regarded as non-confidential unless explicitly stated.
According to the Commission, bidders must not enter into any arrangement with any party that would restrict the ability of other bidders to plan, build or operate their networks under the Spectrum Licence.
It goes further to state: “Bidders are not permitted to engage in any type of restriction on the costs of software or equipment with suppliers that would influence the ability of other Bidders to plan, build or operate their networks under the Spectrum Licence.
Applicants are not permitted to receive advice on 3.5 GHz Spectrum Auction matters from any persons retained as an advisor by another Bidder in the Spectrum licensing process.” These, the Commission termed as anti-competitive behaviour.
The publication of the Draft Information Memorandum for the auction of the 3.5GHz Spectrum Band, which was published last week will enable stakeholders make written submissions on the subject and participate in the Stakeholders’ Engagement Programme scheduled to hold on November 3, 2021, preceding the upcoming auction of the 3.5GHz spectrum band, as part of its 5G technology deployment plan.
All submissions on the Draft IM, the NCC noted, must reach the Commission on or before Wednesday, October 27, 2021.
However, The Commission warned that The IM does not constitute an offer or invitation to participate in the Auction, nor does it constitute the basis of any contract that may be concluded in relation to the Auction or in respect of any assignment of the 3.5 GHz Spectrum, and should not be misconstrued as financial, legal, technical or other advice from the NCC.
Through the years, the Commission has implemented a number of initiatives and policies that have stimulated the growth and development of the communications sector. As a result, significant improvement has been achieved leading to major increases in mobile subscriptions, internet and broadband penetration engendered by the competitive environment in the sector. In its drive to deepen broadband penetration in the country, the Commission has decided to auction two (2) lots of 100 MHz TDD slots available in the 3.5 GHz band to support the delivery of ubiquitous broadband services.
Nigeria has an estimated population of 214 million, with an average growth rate of 2.6% annually. Approximately 76.46% of the population is under the age of 35. In line with these demographic changes, internet penetration grew from 3% in 2004 to 74.2% as at April, 2021 and broadband penetration increased from less than 10% in 2015 to 40.66% in April, 2021.
The NCC noted that since the year 2000, the Nigerian communications market has witnessed major increase in competition driven by the Government’s liberalization policies. The competition has in turn led to increased growth in the number of connections and improved services for subscribers as anticipated. To continually provide the required frequency resources to support this growth, the Commission plans transparent assignment processes when frequencies are available and/or allocated to it. In this regard, the Commission has initiated the process of 3.5 GHz Spectrum Auction.
The proposed licensing of 3.5 GHz Spectrum has been influenced by the need to open up the space for the delivery of present and future generations of broadband services to subscribers in line with the Nigerian National Broadband Plan (NNBP) 2020-2025.The Commission has consulted with relevant industry stakeholders to determine the demand and the best way to assign the Spectrum . Arising from these, and in line with global trends, the Commission further to its powers has commenced the licencing process for 2 lots of 100 MHz each through the Spectrum auction process.
In a landmark inter-agency collaboration, the Nigerian Communications Commission (NCC) and the Nigerian Communications Satellite (NigComSat) in the 2nd quarter of this year, signed a Memorandum of Understanding to work together in a bid to further the cause of the deployment of the Fifth Generation (5G) technology for ubiquitous access to broadband services. This necessitated NigComSat to relocate the operations of NG-1R (Nigeria communication satellite) to the standard C-band 300MHz (3.9GHz – 4.2GHz) potion of the band, which is more suitable in terms of Satellite service offering because end-user terminal are cheaper there, while leaving the non-standard C-band 400MHz (3.5GHz – 3.9GHz) portion of the band for 5G use. The cost of relocating the NG-1R is expected to be offset from the proceeds of the auction of the 5G Spectrum.
