Buhari To Query Secret Sale Of Over $1bn New Telecom Spectrums

imageOnce President-elect Muhammadu Buhari assumes office, he will focus his searchlight on the circumstances surrounding the secret sale of Digital Dividend Spectrum (DDS) licences valued at over $1 billion in the last few months by President Goodluck Jonathan.

It is believed that due process was not followed.

Already, one of the terms of reference handed to the Alhaji Ahmed Joda-led transition committee last week was to provide a brief overview of the goings-on at the Nigerian Communications Commission (NCC), among other key government agencies, and provide quick-fixes within 30 days, 100 days and six months for the Buhari-led government.

According to an exclusive report published this week by online newspaper, Technology Times, ahead of the 2015 general elections, President Jonathan secretly sold two spectrums in the 800MH and 700MH to the chairman of Visafone, Mr Jim Ovia, and Otunba Mike Adenuga’s Globacom respectively without recourse to public auction.

The licensing did not pass through the normal bidding process, thereby preventing the NCC, the statutory body, from advertising and supervising a public auction.

Digital Dividend Spectrum allocation takes effect from 2015, in line with the dictate of the International Telecommunications Union (ITU) that television stations migrate from analogue to digital broadcasting from June 17, 2015.

DDS is released when television broadcasters switch from analog platforms to digital-only platforms; part of the electromagnetic spectrum that has been used for broadcasting will be freed up because digital TV needs fewer spectrums than analog television.

Already, the NCC is enmeshed in fresh crisis following the illegal and secret sale of a spectrum belonging to Nigerian Police to Open Skys Ltd as well as the secret sale of another spectrum to South African investors behind Smile Communications Ltd, one of the fourth generation network operators in the country.

When contacted, the NCC director of public affairs, Mr Tony Ojobo, said he could not comment on the matter.

“I don’t have any information on it,” he said.

However, a top official of the Commission said the spectrum allocation followed a directive from the president.

“If the president orders you to allocate a certain spectrum, who are you not to obey?” he asked. “The directive came from the president and even the minister of communications technology cannot disobey it.

“Under normal circumstances, for NCC to sell a spectrum it should be by auction. But this is a directive from above.

Another source said the deal was done under the table on the expectation that the president would win his re-election.

He said NCC collaborated with the National Broadcasting Commission (NBC) on the belief that the proceeds of the sale of the spectrum licences would be deployed to fund the purchase of set-top boxes that would be used by Nigerians should the digital switchover take place on June 17, 2015.

The NBC has now shifted the switchover date to December 2017.

Calls to the spokesman of Globacom were not answered at the time of going to press.

Digital Dividend Spectrum is seen as a potential cash cow by telecom companies globally as it is used to deploy few base stations that provide voice, video and data communications at the highest broadband speeds.

A top telecom expert said the market had been bastardised, systematically distorted and disrupted whilst the investors are left guessing about the value of their investments.

“The president lacks the power under the law to make spectrum allocation,” he asserted. “The president can make policy, in the way provided for by the law, and ensure that those he appoints follow such public policy. Regulators are created around the world in order to protect players in the market, i.e. protect consumers of service, protect investors/operators and deliver government policy.

“The regulators are deliberately designed to be independent so that there is no political interference in their functions. The president or the minister is not to interfere with the functions of the regulator; in fact, section 25(2) of the NCC Act prohibits minister and, by extension the president, from interfering in NCC functions, and requires the minister and by extension president to ensure that NCC functions are independent of any political interference.”

It is recalled that Dr Bashir Gwandu, a former executive commissioner at NCC, gave an interview in February 2012 highlighting what they had achieved at the ITU World Radio Communication Conference 2012 which led to the securing of additional 70MHz paired spectrum and 25MHz unpaired in the bands 700/850MHz, which span 700MHz, 800MHz and 900MHz Bands from the ITU .

It was the same spectrum whose allocation was secured by Dr Gwandu and his African team from the UN body that is in the spotlight again. In fact, it was the resistance of Gwandu to underselling, without competition, of part of the 800MHz and 450MHz that eventually led to his sack by President Jonathan.

Gwandu’s sack has since been declared illegal in the National Industrial Court ruling on Dr Bashir Gwandu v President, FRN (Jonathan) on January 21, 2014 where N100 million damages were awarded to Gwandu.

Of the three bands, the 800MHz, which had already been sold in controversial circumstances, was the one for which Gwandu was suppressed for attempting to blow the whistle.

He stood against the under-selling of a 10MHz slot in the 800MHz spectrum band to a South African company called Smile Communications Ltd at about €13 million only, when the exact equivalent spectrums were sold in Germany, Italy, France and UK for €1.153 billion, €992 million, €891 million and €631 million respectively, the UK earning slightly lower amount due to imposed strict coverage obligations.

In a related development, Belgium, a country of just 11 million people, raised €120million for each of the three slots of the 800MHz spectrum, generating a revenue of €360million.

And in a rather complicated mixture of 4G Spectrum slots, the Netherlands was only recently able to raise €3.8 billion from the 4G auction. So, each of the 10MHz paired spectrum slots in the 800MHz bands secured over a billion dollars for some countries in Europe.

The spectrum that was secured by Gwandu, totalling 70MHz duplex and 25MHz simplex, was 30MHz Duplex in the 700MHz band, 30MHz Duplex in the 800MHz band, 10MHz Duplex in the 900MHz band as well as 25MHz in the 700MHz simplex.

In particular, the specific bands are 703-733/758-788MHz, 791-721/832-862MHz, 880-890/925-935MHz, as well as 733-758MHz Simplex.

According to experts, each of the seven slots of 10MHz will fetch no less than $1billion in Germany for example.

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