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NCC's Executive Vice Chairman, Prof. Umar Garba Danbatta

NCC’s milestones since 2015(6): Championing Investment, Restructuring VAS Segment to Stimulate Innovations, Jobs Creation

NCC:

Nigerian Communications Commission (NCC) said four years ago, the foreign direct investment (FDI) and local investment profile in the telecoms sector stood at $38 billion. But today, investment in the sector has grown significantly to over $70 billion. The Commission also continues to strengthen commitment towards pursue relevant policies to encourage more investment into the industry.

Speaking at the maiden Nigerian Telecom Leadership Summit (NTLS) held in Lagos in 2019, Danbatta, had noted that “the volume of telecom investment in Nigeria is very impressive and indicative of a very fast-growing and resilient sector of the economy. But, we will continue to advocate for more investment, given that the industry is very capital intensive, with the competition for FDI becoming fiercer among different nations.” Today, the Commission estimates that about 40 million Nigerians – especially those in the rural and semi-urban areas- are yet to be reached with basic telecom infrastructure and services.

According to Danbatta, “the argument for more investments becomes more compelling, given that this industry is very capital intensive, with the competition for Foreign Direct Investments (FDls), becoming fiercer among different nations. In our consultative regulatory process, we consider shared experiences, and shared vision as the best approach to equip us with the tools to continuously reposition towards the course of effective regulation.”

He stated further that, as the 4th Industrial Revolution blurs the lines between the physical, biological and digital boundaries, the industry will continue to witness challenges of investments to match growth and technology evolution dynamics. In this age, broadband is of critical importance with its potential to improve the economy of many nations. “We may all be aware of the empirical study by the World Bank, which suggests that for every 10 per cent growth in Broadband penetration results in 1.34 per cent in Gross Domestic Product (GDP) in developing countries. This is one of the reasons why we have developed the regulatory and licensing framework to accelerate broadband availability, accessibility and affordability,” Danbatta stated at the NTLS in Lagos.

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In the last four years, the Commission had succeeded restructuring value–added services (VAS) segment of the telecommunications sector through the development of VAS Aggregator Framework – a move that has helped to sanitise the industry. Today, the telecoms VAS segment, currently estimated at $200 million, is said to now have the potential to be worth over $500 million in the next few years.

Consequently, the Commission’s Board Resolution at its 88th sitting held on Thursday 27th September, 2018 considered and approved the recommendation for the grant of VAS –Aggregator Licence to nine companies. An additional licence has been added, bringing the number of licensed VAS Aggregators in the telecoms sector to 10. The licensed companies are: I-Cell Multimedia Limited, Nina-Jojer Limited, 21st Century Technologies Limited, Nitroswitch Limited, HML Consulting Limited, Iykejordan Limited, Cognys Systems Limited, Perpetual Communications Limited, Mobile Intelligence Limited and Aerandir Technologies Nigeria Limited.

Apart from boosting activities in the VAS segment of the telecoms space in Nigeria, the VAS aggregator licensees will improve innovation, local content, employment opportunities, and increase in income stream to both network operators and content developers.

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