Telecoms operators in Nigeria have recorded a growth in their Internet subscriptions by five per cent yearon- year to 92.3 million in May, according to the latest data released by the telecoms umpire, the Nigerian Communications Commission (NCC).
This represents a density of 50 per cent, placing Nigeria well above the African average of around 16 per cent as estimated by McKinsey, a global ICT-focused research firm. In developed countries, increased Internet penetration has driven businesses via e-commerce and bolstered economic growth.
Already, a World Bank study has revealed that a 10 percentage point increase in fixed broadband penetration would increase Gross Domestic Product (GDP) growth by 1.38 per cent in developing economies.
The latest subscriber statistics from the regulator show MTN and Globacom accounting for 36 per cent and 29 per cent of active Internet subscriptions respectively, but the country has huge subma rine cable capacity bringing huge bandwidth into the country.
However, Nigeria’s submarine cable market currently valued at over $7 billion (over N1.4 trillion) is experiencing low utilisation of the broadband infrastructure, occasioned by the lingering transmission challenges, which have continued to dog its spread across the country.
According to this newspaper’s findings, while the country currently boasts of different international submarine cables’ landing points at its shore, the challenge of transmitting the over 19 terabytes bandwidth capacity on them to hinterland has been a challenge.
According to experts, the development, if not checked puts the 30 per cent broadband target of the country by 2018 at greatest risk.
Broadband penetration in the country currently stands at 10 per cent while the coming on board of various submarine cables such as MainOne, Glo 1, SAT-3, WACS, ACE and their proper transmission across the nooks and crannies of the country has been identified as essential to achieving broadband.
In specifics, the submarine cables included the $300 million 7,000-kilometre MainOne cable, which landed in Nigeria in June 2010; the 10,000 kilometres Globacom’s $800 million Glo 1 cable.
It landed in October of the same year. Also, the worth of NITEL’s South Atlantic 3 (SAT 3), now owned by NatCom Investment company, the parent body of ntel, is put at over $600 million and the MTN’s West African Cable System (WACS) cost about $650 million.
ACE cable, which was landed in Nigeria by Dolphin Telecoms, cost about $700 million. However, less than 10 per cent of the total bandwidth capacity on the various submarine cables is being utilised, according to Chief Executive Officer, Main- One, Mrs. Funke Opeke.
She identified high cost of Right of Way (RoW), lack of collaborations among players, as well as low patronage of locallyestablished cable system as challenges to last-mile connectivity.
“While we are still facing a lot of challenges regarding the transmission of the Internet capacity on our cable system to the hinterlands, we are also facing low patronage from Nigerian companies, which prefer to still go outside the country for capacity to run their businesses,” Opeke said.
She said: “Though, Main-One has built 400 kilometer of fibe optic cables in Lagos, challenges still remain in the area of last-mile transmission to other parts of the country and this is where I think the government can wade in to assist because our business has greater potential for economic development.”
Opeke said years into the landing of submarine cables in Nigeria from separate cable operators, the country was yet to make maximum use of the cable capacities towards deepening Internet penetration.
President, Association of Telecoms Companies of Nigeria (ATCON), Mr. Lanre Ajayi, said the challenges telecoms companies are facing in the area of transmission as a result of high cost RoW and delay in granting RoW permits could hamper broadband growth.
Broadband services continue to impact on increased access to the Internet in the country with Internet users in the country standing at 97 million as at December last year but witnessed decline to about 93 million currently.
He also identified the need for the telecoms regulator to release more spectrums while putting idle spectrum band into the secondary spectrum market to ensure effective utilisation of the spectrum resources for deepening access to telecoms services.
While the Federal Government had set the target of a five-fold increase in broadband penetration, in consonance with the National Broadband Plan (NBP) by 2018, the submarine cable systems have been virtually stranded on the coastline, unable to deliver service to the hinterland, due to the under-developed distribution networks, including national long distance fibre, metro fibre and last mile connectivity, required to push Internet services in-land.
McKinsey & Company, a research firm, estimates that bringing broadband penetration levels in emerging markets, such as Nigeria to today’s Western European levels could potentially add $300 billion to $420 billion in Gross Domestic Product (GDP) and generate 10 million to 14 million jobs in the coming years.
As at 2014, investments in submarine cable system across Africa was put at over $20 billion, with Nigeria accounting for about $7 billion including the logistics. In Nigeria, with 97 million mobile Internet users in the country, it is estimated that about 50 per cent of the country’s population still lack access to the Internet.