Right of way charges frustrating 4G development in Nigeria
Right of way charges (in light of telecommunication) are levies paid by telecom network operators to state/federal governments for laying optic fibre cables on state or federal roads, as the case might be. Laying of fibre optic cables serves diversity of intentions but for the purpose of telecommunication, it is importantly used for 4G high-speed data connectivity.
4G is the fourth generation of technology widely used in different countries, with Nigeria inclusive. This technology provides speedy communications between gadgets and is the most widely used broadband cellular network technology in developed countries, with developing and under-developed nations yet to entirely implement it. The speed roof of 4G is however much below that of 5G, which is the industry’s latest. While 5G engages with a possible maximum speed of 20 gigabits per second (Gbps), 4G could only cap at 100Mbps.
The latency of 4G is 50ms while that of 5G is 1ms or less. These rates shows how swift real-time communication using these technology are, and this requires extensive infrastructural investment to keep it seamless and running.
In Nigeria, 5G is yet to be put into market, although there have been test-runs in several cities by MTN. 4G being the latest cellular technology to be commercialised in the country however is yet to make a penetrative influence in Africa’s largest telecom market. One of the hindrance to 4G development in Nigeria is the outrageous levies charged off for right of way. This has significantly stalled the deployment of fibre optic cables which is paramount for the wholesome role-out of 4G.
More details about 4G and deployment of fibre optic cables
Fibre optic cables are important for 4G development due to their speed and reliability. Microwave and other possible connectivity means aren’t as speedy, durable and reliable as through fibre optic cables. With Nigeria as case study, 2G and 3G connections are transmitted via microwave links between base stations. In some cases, they are finally connected through fibre optic lines at hubs to central networks, as they could effectively handle more bandwidths.
With 4G, connection between base stations ( i.e telecom masts) are most times through fibre optic cables. Fibre cables are thin glass or plastics which transmits information coded within a beam of light, literally with speeds nearing that of light. With these cables, bandwidth are widened, allowing more users swift access to the internet at a time. It is predicted that with 5G, more fibre optic cables would need to be deployed than it would have been through 4G.
Right of way in Nigeria
In many countries, with Nigeria inclusive, highways, streets, roads, footpaths and sidewalks are public rights of way; its use by the public is at no cost. The right of way or an easement in Nigeria is a property right which confers a non-possessory interest to the general public to travel on or make use of access ways. However, by implication of certain provisions of the Land Use Act, the use of these assets by erecting infrastructures are controlled by each state governor.
These governors are mandated by law to hold in trust those assets on behalf of the people. By virtue of such, the law allows each state executive to charge its own slated levy on telecom operators who intend deploying broadband infrastructure on the roadways which are under their care.
Charges by each of the 36 states differs with another, with some going even exorbitant. In a move to equalise that, the National Executive Council, (NEC), comprising of State Governors and Ministers, in 2013 and thereafter in early 2020 reviewed the multiple taxations in the telecommunications Industry. To that end, right of way charge, being one of the sector’s lingering issues was agreed to be a uniform N145 levy per linear meter of fibre.
Increased right of way, an internally generated revenue to some states
Despite the consensus, 14 states are still reportedly continuing in their immoderate charges. States of Kano, Anambra, Ondo, Cross River, Kogi, Osun, Kaduna, Enugu, Adamawa, Ebonyi, Imo, Gombe, and Kebbi have found it worthwhile to charge telcos between ₦300 ($0.83) and ₦6000 ($16.54) per linear meter. This portrays an acute detour from the agreement reached in 2013.
With the adverse economic realities in the country, and the need to generate funds internally, state governors sees the right of way charge as the gateway for increased revenue. Majority of the states which go exorbitant with their charges are states whose IGRs are palely low.
Despite the hike by some states, others have gone on to institute waivers in order to enhance telecom development and penetration in their entities. Notable among them are Kwara, Ogun Anambra, Kaduna, and Ekiti states. While Kwara State reduced its charges to N1 per linear meter of fibre, Anambra and Kaduna States, waived the charge completely. Ogun State on its part as well, waived a 250km way for telecommunication cable company Mainone to lay fibre in Ogun State.
Increased right of way could influence data tariffs
With the growing trends in deployment of 4G infrastructure in the country by both regional and major telecom operators, much data traffics would be based on the 4G technology.
The effect would see a dishonest data give-outs premised upon high costs of installing infrastructures and accompanying need to use the services these infrastructures could offer.
There’s definitely no positive projection for internet data tariffs if a downward review isn’t made to right of ways levies gotten off telecom operators. If uniformity isn’t made to these charges as it seems likely, an inflated price of auxilary products would be inevitable.
A reduced right of way would influence broadband penetration
One sector which would adversely be influenced if right of way charges remain hiked is broadband penetration. The Nigerian Communications Commission, NCC, defines its broadband penetration metrics as the amount of the Internet access market that high speed or broadband, which include at least 3G and 4G internet has captured.
According to industry reports, the broadband penetration in Nigeria is 39.58 percent (February 2020). And the government’s aim of achieving a 70% broadband penetration by 2021 is practically impossible in the light of these charges. The government’s target is part of a grand plan of creating a digital economy, and it hopes the informal sector would be more engaged by virtue of this.
There have been calls for the reduction of right of way charges
The Association of Licensed Telecommunication Operators of Nigeria in its stance has beckoned the government especially at the state levels to eliminate right of way levies. The association while complimenting state governors who have either waived the fees or reduced it, reiterated the benefits of such steps.
Others who have advocated the waiver includes the Association of Telecommunication Companies of Nigeria and the Executive Vice Chairman of NCC, Prof. Umar Garba Danbatta. Danbatta made visible his fervent advocacy by recently demanding from the National Assembly a legislation that will classify telecoms infrastructure as critical national infrastructure across the country. He hopes to institute a legislation to encourage the laying of these infrastructures while attracting no unwarranted levies.
Maintening the legacies of 4G also stalls the development of the technology in Nigeria
Despite the buzz telecom operators (except some regional few) try to make of 4G broadband connectivity in the country, majority of Nigerian have lost hope in its effectiveness. Most subscribers have failed to identify the difference between the 4G network which they have ported into, to their erstwhile networks.
Although 4G data plans have now been regularised by the major telcos, in that there are no disparity between 2G, 3G and 4G bundles as could be experienced in other countries, the quality of service are deteoriating especially during peak-usage periods.
With the broadband speed experienced in the country being one of the worst in Africa, and in the world generally, aside multifaceted charges, these unending issues in like manner dampens the legacies of 4G, hindering its development altogether. And it augurs unfavourable consequences to other sectors of Africa’s largest economy, of which the telecom arm has over the years proven to be its indispensable mainstay.