Telcos investors grumble as Nigeria’s State govts increase RoW charges

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The Ministry of Communication and Digital Economy has kept mute over the hike in the Right of way for Telecom operators.

About 14 states across the federation have increased charges on telecom operators, despite the Minister of Communication and Digital Economy, Isa Pantami’s directive issued late last year.

In his letter to the governors across the 36 states, he cautioned the governors to reduce the charge of the Right of Way (RoW).

The RoW charge is the levy paid to state governments for the laying of optic fibre by telecoms operators.

According to a report from THIS DAY newspaper, Lagos, Kano, Anambra, Ondo, Cross River, Kogi, Osun, Kaduna, Enugu, Adamawa, Ebonyi, Imo, Kebbi and Gombe, have hiked the cost of Right of Way (RoW) for telecoms infrastructure.

Mr Pantami, on January 3, said he had written to state governors to comply with the reduction of RoW. “I have written to all the governors in Nigeria on the need to comply with the National Economic Council (NEC) resolution on the Right of Way (RoW)”.

“All the governors had agreed to the harmonisation on the RoW charges and efforts are being made to ensure the policy is respected.”

Disobedience

Investigations revealed that agencies and ministries of some of these states have increased the cost of RoW from the initial fee of between N300 to N500 per linear metre to between N3,000 and N6,000 per linear metre.

However, the cost of RoW on federal roads is N142 per linear metre.

Some of these agencies and ministries include: the Lagos State Infrastructure Maintenance and Regulatory Agency (LASIMRA), State Information Technology Agency (SITA) of Ondo, Cross River State Infrastructure Safety and Regulatory Agency (CRISRA), Kogi State Environmental Protection Board and Kano State Urban Planning and Development Authority.

Others are Kogi State Internal Revenue Service (KSIRS), Kaduna State Urban Planning and Development Authority (KASUPDA), Osun State Ministry of Environment and Sanitation, Anambra State Internal Revenue Services, Enugu State Ministry of Environment and Mineral Resources, Adamawa State Ministry of Environment, Imo State Environmental Transformation Commission (Imo ENTRACO), Kebbi State Ministry of Environment and Solid Minerals and Gombe State Internal Revenue Board.

It was also learnt that some of the states refused to collect the old rates for RoW and are no longer issuing RoW licences in their various states.

The new management of the LASIMRA recently increased RoW fee from N500 per linear meter to N5, 000 per linear meter.

A telecoms operator, however, needs RoW covering thousands of kilometres, to operate.

The minister’s spokesperson, Uwa Suleiman, when contacted, refused to speak on the development.

When she was contacted, Ms Uwa ended the call without saying a word. And she did not respond to text and WhatsApp messages sent to her.

Reasons for the hike

The Commissioner for Information, Cross River State, Asu Okang, when contacted, said it was prepared to go into negotiations with telecommunication companies on the possible adjustment of charges they pay for RoW to install infrastructure, particularly telecommunications masts.

However, the state government did not state if the negotiations with the telecommunications service providers would lead to a reduction in the cost they are currently being charged for the location of their masts.

The official revealed the state was open to negotiations on the issues raised by the companies.

The commissioner said despite the complaints from telecommunications service providers, the rates charged by Cross River State was lower than those charged by its neighbouring states.

He said the rates charged by the state was within those prescribed by the federal government, adding that the telecommunications companies, of recent, had not been building new masts, but rather adopted the policy of co-location.

Also, the Senior Special Adviser to the governor of Ondo State on Information and Telecommunications Technology, Olumbe Akinkugbe, said the agency had designed a policy that could reduce cost of operations for the telecommunication companies.

Mr Akinkugbe, who is in charge of State Information and Technology Agency (SITA), however, said the companies had to be opened on their infrastructural needs and their plans to achieve same.

He said at the national level, the federal government had also established Broadband Infrastructure Rollout Plan, which has resulted in infrastructure companies being given concessions for RoW nationally, that had been broken into regions.

“What we are planning to do is to encourage what we call ‘One Dig Policy,” he said.

“One dig policy is a situation whereby we partner with reliable organisation to actually develop a fiber rollout plan on these right of way at a discounted rate such that when various telecoms operators are coming in there is already a laid down path as well as dug,” he explained.

“What that will do is that it will prevent a situation where MTN wants to expand their fibre infrastructure, they come and apply for right of way and dig; that Airtel wants to come, they come again, they open up the ground and start digging,” he explained.

In Kano State, the state Commissioner for Works and Infrastructure, Mu’azu Magai, said the state had extended some reliefs and waivers to telecommunication operators and offered them suitable places to erect their masts.

“On this issue of telecommunication companies and fees, basically across the whole country, the cost of erecting (a) mast is the same as in Kano State,” he said.

“But in special circumstances, we granted some discounts to some operators regarding the total cost they pay especially if that mast is within a government facility.

“We always encourage telecom operators to identify suitable places within government premises to erect their mast that will provide good coverage in the area. Not only that, the state government has engaged NCC and telecom operators to have access corridor for infrastructure network of telecommunications,” he said.

He said the state government had given waiver to MTN regarding the access corridor fibre of their network.

According to him, the waiver is for their access corridor fibre which is new telecom infrastructure, which NITDA and NCC are trying to provide high speed broadband internet network in Kano.

The Director General of Kaduna State Urban Planning and Development Authority (KASUPDA), Ismaila Dikko, said he was not aware of complaints by the telecoms operators over high cost of RoW.

Telecoms operators across networks had blamed the poor telecoms service currently being experienced by subscribers on the refusal of the federal and state government agencies to grant the operators the RoW licence to lay more fibre optic cables in cities.

Telecoms subscribers have continued to face networks challenges, ranging from incessant dropped calls and poor connectivity to delays in delivering text messages, among others.

The operators said they had envisaged heavy surge at festivity periods like Christmas and New Year seasons and had long requested for RoW licence that would enable them to expand their networks by laying more broadband fibre optic cables.

They, however, stated that their request was rejected by the various government agencies, forcing them to maintain the available network, which is not sufficient to manage the peak periods.

Reacting to the allegation, the Special Adviser on Innovation and Technology to Governor Babajide Sanwo-Olu of Lagos State, Tunbosun Alake, said there was need for smart regulation of telecoms operations in the state without having negative effect on service quality in telecoms delivery.

According to him, “The issue of Right of Way has always been a challenge between state governments and telecoms operators who seek permission on RoW to expand their networks and infrastructure. I have a private sector background because I came from the private sector, and now that I am in the public sector, I understand the feelings of both sectors.

Mr Alake said there is an errorneous belief surrounding the telecoms sector that state governments see them as cash cows to be milked dry.

“In Lagos, the government sees telecoms as critical source of infrastructure for the state, which needs smart regulation so that telecoms operators do not take undue advantage of the citizens, hence the need for balancing,” he said.

The Lagos State government, through its agency, the Lagos State Infrastructure Maintenance and Regulatory Authority (LASIMRA), has been equipped to enforce regulation and compliance of telecoms mast installation and digging of roads for the laying of fibre cables by telecoms operators. LASIMRA has the mandate of Lagos government to smartly regulate the installation of telecoms mast and the installation of other telecoms infrastructure in the state.

“With the new management of LASIMRA, I believe they will grant RoW to telecoms operators to enable them expand their networks and infrastructure in such a way that it will not hinder network expansion that will address poor service quality, and at the same time, it will not inconvenience the citizens that are expected to benefit from the telecoms services,” Mr Alake said.

Implications

The President Association of Licensed Telecoms Operators of Nigeria (ALTON), Gbenga Adebayo, said the action by the states is detrimental to the wheel of progress.

He said the state government regard telecommunications as source of generating internal revenue and pleaded for the federal government’s intervention.

“They are not looking at the socio economic benefit offered by the services we provide,” he said.

“The industry is concerned and this will discourage investment,” he said.

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Godwin Okafor is a Financial Journalist, Internet Social Entrepreneur and Founder of Naija247news Media Limited. He has over 16 years experience in financial journalism. His experience cuts across traditional and digital media. He started his journalism career at Business Day, Nigeria and founded Naija247news Media in 2010. Godwin holds a Bachelors degree in Industrial Relations and Personnel Management from the Lagos State University, Ojo, Lagos. He is an alumni of Lagos Business School and a Fellow of the University of Pennsylvania (Wharton Seminar for Business Journalists). Over the years, he has won a number of journalism awards. Godwin is the chairman of Emmerich Resources Limited, the publisher of Naija247news.

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