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Telecommunications Equipment and Services Nigera

 

 Telecommunications Equipment and Services

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Overview

	2009	2010	2011
Total Market Size	529	685	788
Total Local Production	6.5	8	9.8
Total Export	0	0	0
Total Import	522	677	779
Imports from the U.S.	130	169	234

Note: Figures in millions of dollars
Estimates from industry contacts
Exchange rate: 150 Naira to 1 USD

 

In 2011, Nigeria plans to auction telecommunications frequencies in the 700MHz and 2.5 GHz spectrum through a competitive bid process.  Industry reports disclose that the Nigerian Communications Commission (NCC) hopes to generate more than $40 million dollars from the expected sale and revenue from other licenses including spectrums for wireless services in the ranges of 470 – 860 MHz, 1.2 – 1.6 GHz, 2.7-1.6 GHz, 2.7-2.9 GHz, 3.6 – 4.2 GHz and 4.4 -5.0 GHz. For more information about telecommunications regulations, NCC and upcoming projects, visit http://www.ncc.gov.ng

Nigeria is the largest and the fastest growing telecommunications market in Africa.  According to NCC, the estimated total number of phone lines (both mobile and fixed line) in Nigeria at the end of August 2010 was about 81.9 million with a tele-density of 58.32.

This is an improvement from the September 2009 figure of 70.3 million lines and a teledensity of 50.24.  Nigeria accounts for over 35 percent of internet traffic in West Africa. With over 2000 licenses managed by the Nigerian Communications Commission (NCC), the market generates over USD10 billion in telecommunications services revenue annually and is regarded as Nigeria’s most lucrative industry sector outside of oil and gas.  The Association of Telecommunications Companies of Nigeria (ATCON) said that annual investment in this sector is projected at US$ 6 billion between 2010 and 2014.

For more information about ATCON, visit http://www.atcononline.org/

A major industry breakthrough witnessed in 2010 was the landing of two broadband cables into Nigeria by two local firms, Globacom (Glo One) and  Main One Cable Company Limited (Main One). The two submarine cables offer open access, wholesale broadband capacity in Nigeria and West Africa through submarine cable systems that link West Africa with the rest of the world via Europe.  Glo One and Main One cables are expected to increase Nigeria’s broadband capacity by 2.6 terabits from SAT-3 cable of 350 gigabits for a total of almost 3.0 terabits for the entire country.  In July 2009, damage to the SAT-3 cable, Nigeria's only link to the global communications system, affected 70 percent of the country’s bandwidth and crippled bank services and Internet access nationwide.

Nigeria’s telecom market is dominated by service providers from South Africa (MTN), India (AirTel), Nigeria (Glo), UAE (Etisalat) and equipment/peripheral providers from Europe (Ericsson, Siemens and Nokia), Asia (ZTE, etc.) and the United States (Motorola and Harris Stratex, etc.). Nigeria is the chief driver of telecommunications import, trade and investment in West Africa.  

At the inception of cellular mobile telephony in Nigeria in 2001, the country had fewer than 500,000 functional wireless and fixed telecommunications lines. Nigeria joined the global system for mobile communications (GSM) through an auction process whereby competing operators were selected to bid the available licenses.  Four firms successfully concluded the auction but only three met the mandatory deadline for payment of the license fee of $280 million each.  The successful firms were Econet Wireless (now known as AirTel), MTN Nigeria, and NITEL (through its subsidiary - MTEL), the Nigerian government-owned telecommunications parastatal.  The Nigerian mobile networks operate in the GSM900 MHz and GSM 1800 MHz frequencies.  Nigeria licensed and launched a Second National Operator (SNO), Globacom Mobile Ltd, in 2002. The SNO has a bundle of licenses to provide services related to wireless digital mobile, fixed-line services, data, Internet and IP services, business and carrier solutions. 

The NCC commenced the unified licensing regime in May 2006, awarding the first batch of unified licenses to four telecommunication service providers.  The unified license permits telecommunications companies to offer services across the board in telecommunications, including fixed line, wireless, data services, etc.  This marks the end of the five-year exclusivity incentive granted the mobile telephone licensees in 2001

In July 2007, three carriers in the 800MHz spectrum band were awarded to Visafone Communications in a competitive auction process that included GiCell Wireless Limited, Multilinks Telecommunication Limited, and TC Africa Telecoms Network Limited.  Also in March 2007, four licenses for a 10MHz lot in the 2GHz spectrum were issued to Alheri Engineering Co. Limited, Celtel Nigeria Limited, Globacom Limited, and MTN Nigeria Communications Limited.

Best Prospects/Services           

As Nigeria deepens and expands its telecommunications infrastructure over the coming years, the biggest growth is expected from opportunities offered by broadband. Nigeria is doing well in voice services, but lags behind in data, video and telepresence.  

Topping the list of equipment are digital and mobile phone sets; cellular, transmission and switching equipment and 220V PABX and voicemail facilities.  The best prospects in mobile telecommunications services include banking and financial service support technology and systems, consulting services and training programs.  

Web Resources               

www.ncc.gov.ng, 

www.buyusa.gov/nigeria

www.Nig.org.ng

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