Spectrum auctions in Nigeria

December 9, 2022 by Weekly News

The Nigerian Communications Commission (NCC) has confirmed that Airtel Africa is the sole bidder for 100MHz of 3.5GHz spectrum. The license has a 10 year term and a reserve price of USD273 million. It’s a disappointing result for several reasons: 

  • Because Airtel is the only bidder, it is not a competitive process and therefore doesn’t meet the economic criteria of efficiency; 
  • The reserve price is too high and excludes smaller competitors and, in the medium term, reduces the competitiveness of the Nigerian ICT sector; 
  • The high reserve price will also mean lower investment in the sector by diverting resources to paying spectrum fees rather than investment in infrastructure; 
  • The “use-it-or-share-it” principle is absent from the license 

It’s the last point that is the most damaging. Use-it-or-share-it should be part of every new license. Adding the clause to existing licenses is difficult because it is a change of license conditions, which operators are likely to oppose. But new licenses should simply include it, like Ofcom does when referring to 800MHz and 2600MHz spectrum:

“For the avoidance of doubt the Licences will not guarantee exclusive use of the spectrum awarded. In the future we may grant additional authorisations to allow the use of all, or part, of the spectrum, including the spectrum that is the subject of this Award Process. We would develop and consult on the conditions of use under any such additional authorisations in order to manage the risk of harmful interference”. 

The 2022 Spectrum Trading Guidelines from the NCC state that “[s]pectrum Sharing can only be approved where it is established that it is technically practical to share the Spectrum under consideration, without interference by either user.” But this is insufficient: it is not technical considerations that are the obstacle, it is the principle of use-it-or-share-it. 

It’s not too late. Airtel’s license hasn’t been issued yet and the use-it-or-share-it provision should be included. 

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