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Again, confusion trails NITEL’s sale

After several failed attempts to sell the First National Operator (FNO), The Nigerian Telecommunications Plc, it appears that the renewed efforts to sell the national…

After several failed attempts to sell the First National Operator (FNO), The Nigerian Telecommunications Plc, it appears that the renewed efforts to sell the national asset will not go without controversies. Already, some interested organisations/individuals are complaining that rules are likely to be bent in favour of certain bidders.

One of such complaints is that Globacom, Nigeria’s Second National Operator (SNO) and Telkom of South Africa may be favoured in the NITEL buying process.  At the centre of these controversies is the Bureau of Public Enterprises (BPE) and the Nigerian Communications Commission (NCC).


Pre-bid conference

On January 14, 2010, a pre-bid conference was held at the Transcorp Hilton Hotel, Abuja by BPE. BPE is headed by Dr Chris Anyanwu. It was said that 14 investors who had qualified to bid for NITEL and its mobile arm MTEL attended the event. NITEL being a communication-related organisation, the Executive Vice Chairman of NCC, Engr. Ernest Ndukwe was equally there on the invitation of BPE to provide answers to the regulatory issues relating to the transaction.

This was indispensable because BPE, being in full compliance with all telecommunications regulatory provisions would not afford to repeat the mistakes of the past that stood on the way of NITEL’s privasatition. But there is this cry that all would not be as the law stipulates.

In line with the Digital Mobile Licence (DML) conditions and competition laws, MTN, Etisalat, Zain and Globacom are not qualified to purchase MTel or any part of it, Ndukwe was quoted as saying. He maintained that Globacom whose bid has generated concerns as SNO can purchase any part of NITEL except SAT-3 under sea fibre optic cable. This means that SNO can buy the fixed lines and the transmission facility of FNO.

This provision, some said would effectively merge NITEL and Globacom into one company, thereby contravening the anti-competitive provisions of the Digital  Mobile Lcense (DML) and the National Carrier Licence (NCL) as stated by the Nigerian Telecommunication Act 2003, Section 33(3).

When contacted yesterday, an  official at NCC said anyone who has objections would have raised them since last October when government renewed efforts to sell FNO.

The officer said, in order to encourage investors to buy the fixed line segment of NITEL, NCC had agreed that NITEL be unbundled so as to ease the process and bring in more investors.

According to him, by this process, even those offering mobile phone service who would have been restricted from being part of the deal would have a window.

“We want to encourage operators to invest in our fixed line,” Mouka maintained.

On the issue of South Arfrica’s restrictive investment climate, the NCC official said South Africa has its laws and operates as its laws dictate.

He said contrary to media reports that Wale Adenugu’s company was denied permission to land MainOne undersea fibre cable in South Africa, “Adenuga didn’t go there.” He said the claim that Adenuga was denied right to invest in South Africa is a mere rumour peddled by Adenuga’s people.

He said though none of the companies offering mobile phone service can buy MTEL,

But when contacted on phone yesterday, the Director General of BPE, Dr. Christopher Anyanwu said there was no room for undue advantage for any bidder in the exercise. He said BPE is working in line with the guidelines spelt out by NCC.

He said Globacom bidded for the whole of NITEL and would therefore be disqualified because it cannot be allowed to run the mobile arm of NITEL which is MTel, as that would go against the law.

He stated that standards will be maintained in the Tuesday’s bidding exercise and the most competent bidder would win.

Said Anyanwu, “We want transparent bidding. Everything will be open. There will be no manipulations. Investors are given options…”


The knotty issue

Though each of the concerned officers appeared to have cleared themselves of any wrong doing, one thing could not be explained.

Mtel, as a wholly-owned subsidiary of NITEL has located all its switches base station controllers, service control points, network management systems and 500+tower (except for approximate 60 on lease land. For example, for road coverage) on NITEL property.

More than half the towers used by MTel is actually owned by NITEL and used for NITEL transmission purposes. In most cases, this infrastructure pre-dates MTel rolling out its GSM network.

And unlike MTN, Glo Mobile, Zain and Etisalat, Mtel has no transmission network. It all belongs to NITEL. All NITEL transmissions terminate in the same property that house NITEL local exchanges (those similarly utilised for the MTel switches and base station controllers).

All NITEL’s national transmission lines, both cable and microwave terminate in NITEL local exchange buildings and premises. These termination points cross-connect frames, computer systems, network monitoring and management systems cannot be accessed except through these local exchanges.

Doesn’t all this mean, therefore, mean that any firm that acquires the NITEL national network of local exchanges will automatically control all the Mtel switches. The facilities include base station controllers, over 80 percent of towers and all the MTel contro and support systems and all the MTel national transmission capability. Others are the termination points and all the monitoring and management systems of the NITEL’s national transmission termination infrastructure.

It is therefore feared that if any mobile phone company is allowed to acquire NITEL national network of local exchanges, it will automatically control all aspects of NITEL, including MTel and the national transmission network. 

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