In the past couple of weeks, I’ve been debating with my colleagues about the opportunities for WiMAX in Africa. It has always been hailed as a great technology to provide wireless broadband services on the continent. Its relatively cheap deployment and flexibility made it a good business case for under-served areas. But it hasn’t taken off quite as fast as some of its most fervent supporters were hoping for, and the debate is still ongoing over what the best use is for the technology on the continent.
Over 100 WiMAX deployments are either planned or in service across Africa. Mobile WiMAX is not really an option in the foreseeable future, but fixed wireless services have good potential. Existing operators use WiMAX as a complementary technology to mobile for the provision of wireless broadband services (Orange in Mali and Botswana for instance), or as a cost-effective backhaul solution, ideal for rural coverage. Mostly, it has been seen as a good choice for Greenfield operators due to its easy deployment and favourable licence conditions. In the last few months, the global economic downturn has made it difficult for new entrants to raise the necessary funds, but this trend may change for 2010. The other potential obstacle to WiMAX’s success on the continent is the popularity of CDMA WLL for wireless broadband, supported by an active industry association, the African CDMA Forum (Bill Hearmon, the association’s chairman, is a regular at our conference and a very dynamic advocate of the technology).
As Africa’s largest telecoms market and one of the most competitive, it’s no wonder Nigeria is embracing the opportunities of WiMAX in addition to the other available technologies that are already successful in the market. But, as I’ve experience in last couple of years, things often take longer than expected to get done in Nigeria, and this particular process is being delayed in quite a spectacular fashion.
Licences have been issued for spectrum in the 2.3GHz frequency band for WiMAX services, and were allocated this month by the regulator (the Nigerian Communications Commission - NCC) to Mobitel, Spectranet and Multilinks. But almost as soon as the news was out, doubts were raised about the licensing process, and Nigeria’s Economic and Financial Crimes Commission arrested Ernest Ndukwe, head of the NCC, over the matter. According to my colleagues at Middle East & Africa Wireless Analyst, the main controversy was caused by the award of a licence to Multilinks rather than rival bidder Galaxy; Nigerian paper the Daily Trust reports an issue with winner Mobitel as well, and with contracts for the construction of community information centres across Nigeria.
Ernest Ndukwe is a major figure in Nigeria’s telecommunications as well as across Africa, and a regular speaker at international congresses. He led the NCC’s move to unified licensing in Nigeria, one of the first regulators to do it in Africa. I was surprised to hear of his arrest, but not of the fact that licensing processes are subject to controversy, particularly when matters go back and forth between different government bodies. Indeed, his arrest followed a petition filed by the Hon. Minister of Information and Communications, Professor Dora Akunyili, who has since ordered the cancellation of the whole licensing process. Professor Akunyili took office at the end of 2008, coming from a medical background - she was previously Director General of National Agency for Food and Drug Administration and Control. As new Minister for one of Nigeria’s foremost industries, it is understandable that she takes a keen interest in what is happening with new licences. She also has a strong reputation to defend as a popular public figure in the country, and probably doesn’t want to be associated with any controversy.
The NCC is currently fighting the cancellation and arguing its case with the government, so we should hear more of the story in the coming days or weeks.
Both Professor Akunyili and Ernest Ndukwe are due to give keynote presentations at the forthcoming West & Central Africa Com congress taking place in Abuja in 3 weeks. Their presence should attract a lot of attention from the local industry observers and stakeholders. Hopefully by then we’ll see more clarity in the case.