Infracos: MainOne, IHS Set to Connect 60 Cities to Broadband

Indication has emerged that the planned push by the licensed Infrastructure Companies (InfraCos), MainOne Cable and HIS are on the verge of having improved broadband services to link Lagos and about 60 other cities in the North Central zone of Nigeria.

MainOne Cable is in charge of Lagos and IHS is focusing on the North Central states of the country and Abuja.

MainOne, which landed a submarine cable in the country, about four years ago and recently unveiled a Tier III data centre in Lagos, will provide InfraCo service to about 20 million people in the state.

Industry analysts believed that Lagos offers huge investment returns because it is the commercial capital of Nigeria, where expansive and affordable broadband access would impact significantly on more than 12 per cent of the population and nearly 60 per cent value of corporate Nigeria.

IHS, which operates about 22,000 towers across Africa in sharing deal, has been licensed by the Nigerian Communications Commission (NCC) to focus on states including Benue; Kogi; Kwara; Nassarawa; Niger; Plateau and the Federal Capital Territory (FCT), Abuja.

IHS will first of all focus on 60 cosmopolitan areas in the region it won which includes Benue: Makurdi, Gboko, Katsina Ala, Adikpo, Otukpo, Korinya, Makurdi Tar Vandeikya, Aliade, Otukpa, Lessel, Oju, Okpoga, Awajir, Agbede, Ikpayongo and Zaki-Biam.

Kwara: Ilorin, Jebba, Offa, Oro, Esie, Omu-Aran, Lafiagi, Oke-Oyi, Pategi and Ajasse Ipo.
Niger: Minna, Bida, Suleja, Kontagora, Lapai, Mokwa.
Plateau: Jos, Akwanga, Bukuru, Barkin/Ladi, Pankshin, Shendam, Langtang and Vom.
Kogi: Lokoja, Ajaokuta, Kabba, Okene, Idah, Koton-Karie, Dekina.
Nassarawa: Lafia, Akwanga, Keffi, Kuru, Wamba, Eggon, Nassarawa and Doma.

It is said that no broadband services can be found in any of these towns at the moment, even where mobile Internet access does exist courtesy of mobile network operators.

Daily Times gathered that the likely changes expected of the InfraCos will include developing network connectivity; unlocking growth through broadband; promote infrastructure sharing; transform the beneficiary states to smart states; improving rural telephony; building new revenue streams for the government; transforming Nigeria into digital economy; providing wholesale Layer 2 transmission services on a non-discriminatory, open access, price regulated basis; deployment of metropolitan fibre and provides transmission services, available at access points in neighborhoods among others.

The NCC said recently that it has plans to license seven InfraCos for the six geo-political zones of the country and Lagos, because of its peculiarity.

The Federal Government on its part would also give tax holidays of between five and seven years to cushion investments, accelerate the process and makes it more attractive to the investors as MainOne and IHS are gradually getting the plans off the ground.

Minister of Communications Technology, Dr. Omobola Johnson, who confirmed the government position said that as part of Nigeria’s drive to attract additional investments into the country’s vibrant ICT industry, the country would be focusing on the Open Access Model, which has been adopted for the licensing round, beneficiaries of the licenses shall get tax holidays to encourage the Infracos to invest and guarantee adequate returns on investments.

Principal Partner of KPMG, Joseph Tegbe, consultants to the licensing regime, disclosed that the investors would be encouraged to veer into areas where many consider to be less commercially rewarding, through subsidy, and grants  in their areas of interest.

Tegbe explained that some investors will also be granted pioneer status as part of the incentives to boost their interest in investing in such areas or zones that may look unattractive.

“Such Infracos will get such incentives that could be up to 30 per cent mark up on their capital expenditure (CAPEX) and employee tax holidays as well. To qualify for these, Infracos will quantify their Capex and what it will take to rollout and how long it will take to break even”, Tegbe said.

Commenting on the adoption of the Open Access Model by NCC, the commission Executive Vice Chairman, Dr. Eugene Juwah explained that the model was adopted to promote healthy competition, affordability and global best practices in our regulatory activities

However telecoms expert don’t see the model as being rosy as Kehinde Aluko noted that the InfraCos, will still have to contend with multiple taxation/Right of Way (RoW) issues; unplanned towns and cities; damage to fibre cables; poor infrastructure sharing; security challenges and vandalism.