THE Nigerian Communications Commission (NCC) used last month’s ITU Telecom World 2014 gathering in Doha to market the potential of the nation’s broadband sector. Broadband Nigeria: Enabling Access, Transforming Communities was the theme of the country’s presentation, spearheaded by NCC boss Eugene Juwah, who used every opportunity at the global showpiece to sell Nigeria’s expanding broadband market.
Lead speaker Joseph Tegbe, who is the Country Director of KPMG in Nigeria, noted the massive growth in the use of social media platforms in the country in the past couple of years. “Just in the last three years this market has grown from N62 million in 2011 to N151 billion to date. This is evidence of the widespread demand for broadband Internet services in Nigeria,” Tegbe said.
And with improved infrastructure accentuated by the opportunities available through the inflow of foreign direct investment, Tegbe is confident that the market has the capacity for substantial growth in the next couple of years. He noted that with the existing gap between supply and demand in the broadband infrastructure across the country, “the question is can the supply match the demand. There are some gaps in the broadband market in Nigeria.”
He told his audience about the glut of international undersea cables already in Nigeria without the complementary hinterland and metropolitan fibre networks. “We have currently about four submarines cables in Nigeria, with three terabytes a capacity which only few countries in the world can actually match.” He also mentioned microwave, fibre optic transmission infrastructure in Nigeria ,which he said indicated the almost readiness of the Nigerian operating environment to welcome global investors to plug into the existing facilities.
Describing the huge opportunity for the investors, Tegbe noted: “In the metropolitan transmission ring what you see is limited coverage only about 10 per cent of the cities and towns are covered today. Moving to the homes, we have extremely limited coverage. These two top layers provide a huge opportunity and gap in the broadband supply chain.
“For investors in this room estimated $200billion would be required annually in the next five years to meet this infrastructure gaps. Nigeria offers the best prospects on investment and the best returns on investments according to recent studies,” he told the audience
According to Tegbe, the response to the gap is the Open Access model launched by the NCC in harmony with the nationwide broadband objectives of the Ministry of Communications Technology. He spoke extensively on the vast potentials of Nigeria’s ICT and telecoms ecosystem and the transformation that followed the 2001 GSM revolution in the country.
Tegbe referred to the diversity of the Nigerian economy and the growth potentials, which are predicted on the stable economic environment in the nation; the growth in the consumer index; and the constant upward mobility of the middle class.
He said that Nigeria’s GDP growth for this year was estimated at seven per cent and rated as the largest economy in Africa and 21st largest in the world . “Interestingly, the World Bank has projected that Nigeria will surpass the USA in population by 2050. And most likely to become the third largest population by 2050 rated after China and India with a projection of about 460 million people. That represents the size of the population that the investors have the opportunities of exploring,” Tegbe said.
He also spoke about what potential investors stand to benefit in terms of incentives which include tax holiday and pioneer status, in addition to the ready market as a result of the large population and current low spread of the broadband which is also a potential high growth market because of the expansive uptake of smart devices in the country.
Nigeria has a tele-density of 96 per cent as at September 2014. The ICT sector has continued to be a major driver of the economy in Nigeria, being the fastest growing sector with a growth rate of about 24.56 per cent. The sector directly employs about 12,000 workers with about three million people indirectly employed. Data services have not experienced the same growth as voice, market indicators have shown. There are over 75 million active internet subscribers in Nigeria but they are mostly through mobile devices.