Top
executives of the four biggest mobile phone companies and the telecoms
regulator are billed to meet today at the NCC headquarter in Abuja (in
picture) in a parley that will see the N1.17billion fine imposed on them
topping the agenda
The GSM quartet sought a meeting billed to hold today at the NCC Corporate headquarters in Abuja one week to the expiration of the deadline imposed by NCC for payment of varying millions in fines totaling N1.17 billion for falling below regulatory quality benchmarks in service delivery to mobile phone users, industry sources confirmed ahead of the parley.
NCC had on May 10 this year wielded the hammer that will see MTN Nigeria, owned by South Africa’s MTN Group and Etisalat Nigeria, owned by Etisalat of the UAE, each pay N360 million fines.
On the other hand, Airtel Nigeria, the local subsidiary of Bharti Airtel of India, will pay N270 million while Globacom, Nigeria’s Second National Operator (SNO), will pay N180million.
The mobile phone companies were also ordered to pay their respective fines not later than May 25 this year or risk a fresh round of punitive fines pegged at N2.5million per day if they default in meeting next Friday’s payment deadline.
Following the sanctions, the Senate has ordered NCC to ensure that operators pay the fines following overtures underway by the affected companies for a review of the sanctions.
The quartet of MTN Nigeria, Globacom, Etisalat and Airtel Nigeria, bound in a rare coalition by a common threat this week expressed concern that, “fines will not bring about the desired service quality improvements or offer a lasting solution but will merely deplete essential resources that would otherwise be deployed for network roll out.”
The quarter said in a joint statement called on the government and telecoms administration in Nigeria to work in harmony towards continued promotion of investment in the telecoms sector.
“We wish to use this medium to call on the NCC, the National Environmental Standards and Regulations Enforcement Agency, the Minister of Communication, the National Assembly and the Office of the National Security Adviser to work in harmony to put in place an environment in which we can continue our substantial investments in pursuit of delivering world class telecommunication networks”, the four companies said in the joint statement.
The four companies said that they have invested over N1trillion within the last decade in building and enhancing their networks and plan a further N400billion in 2012 alone on further network spending.
“We are all equally frustrated and concerned about the failures to meet customer expectations and needs with respect to the quality of service. Nigeria deserves and needs first class telecommunications networks. We thus apologize unreservedly to you, our customers, for those occasions when you have been disappointed or inconvenienced by a lapse or failure to deliver the requisite level of quality of service. We however believe that it is necessary to explain the major challenges we face as operators and ask for your understanding and support”, they said.
The mobile phone companies attributed the main source of problem standing in way of attaining high quality of telecoms services as power under scoring that every cell site is powered daily and all-year-round by two diesel generators requiring regular diesel supply and 24-hour security protection.
“We need to recognize that benchmarking quality of service against countries which are not operating in such an environment”, the GSM Big Four added.
They also noted that frequent fibre cuts linking the cell sites which are “frequently malicious in nature” is another key impediment to optimal quality of mobile telephony services.
Due to this, “operators have asked that Telecommunications Infrastructure be declared ‘Critical National Infrastructure’ which would result in enhanced protection for these assets and criminalize the wilful damage of same.”
The quartet also added that multiple taxation by Federal MDAs, State and Local Governments have lately promoted a recent trend towards closure of sites by these government institutions.
According to the companies, “the issue of security is a prevalent threat from our operating environment. We have had particularly unfortunate instances where our employees have been physically assaulted and in some instances killed during site maintenance visits, all in a quest to sustain service quality.”
The companies underscore that while they continue to deepen investments to improve service quality, “it needs to be pointed out that in the telecommunications industry, such investments do not yield the requite improvement in service quality until well after 12 months.”
In the wake of the NCC sanctions mandating them to return over N1.17billion in service quality fines to the regulator latest by May 12 this year the GSM quartet said that due to the capital-intensive of their operations they claimed that, “a regime of sanctions will inevitably erode the confidence of financial institutions and critical partners in the industry.”
The coalition of sanctioned GSM networks said that they “are also concerned that it could create an atmosphere of anxiety and regulatory uncertainty which is unattractive to investment” while adding that, “we are therefore actively engaging with our Regulator to resolve this issue.”
According to them, “solutions being explored include ensuring a forward-looking quality of service framework, taking into account pertinent environmental factors affecting service delivery and preserving the capacity of the industry to attract the requisite level of investment in infrastructure to meet stakeholders’ expectations.”
According to NCC April 2012 Audit Report, MTN, Etisalat and Airtel failed to meet the Commission’s target during the months of March and April this year when the regulator undertook the review while, “Glo recorded value cannot be validated in view of earlier comments above.”
According to the report, “general performance by the operators was poor on this KPI (key performance indicators) in the period under review. Etisalat recorded the worst performance when compared with others and Commission’s minimum threshold in the period under review.”
In separate letters notifying the four affected GSM operators of the sanctions and jointly signed on behalf of the EVC by Head, Compliance Monitoring & Enforcement, U. A. S. Maska and Director, Legal & Regulatory Services, Josephine Amuwa, the regulator said they were penalized for failure to meet the Network Key Performance Indicators (KPIs) in the months of March and April, 2012.
NCC says it monitored quality of service standards for the two months that revealed varying degrees of failure by the Big Four “to meet the minimum standard of quality of service including the key performance Indicators (KPI’s) as specified in Schedule 1 Table 2 of the Quality of Service Regulations 2012.”
According to NCC, “Whereas the Commission had noted the performances in the months of January and February 2012 as being below the specified thresholds however, for the purpose of enforcement of the new Quality of Service Regulations, the Commission had taken these periods as grace period”
In the case of MTN Nigeria, the telecoms market leader by subscriber numbers, the network service quality audit report (see table) revealed that it failed to meet the threshold set by applicable regulations of NCC which “is in contravention of the provision of Section 104 (a) of the Nigerian Communications Act, 2003.”
NCC says that following the default by MTN Nigeria, the operator became liable for the sum of N15 million for each parameter for a service contravened in the month of March, 2012 and a further sum of N2.5 million for each parameter for a service for each day the contravention continued throughout the month of April, 2012.
The regulatory agency further directed MTN Nigeria to pay a penalty of N360million on or before May 25, this year for failure to meet the Network KPIs for the months of March and April 2012 adding that, “upon failure to settle the said penalty within the stipulated period, such penalty shall attract a further sum of N2, 500, 000 (two million five hundred thousand naira only) per day for as long as the contravention persists.”
Etisalat Nigeria, jointly-owned by Etisalat and Mubadala of the UAE and Nigerian investors also suffered a similar fate as its South African rival, MTN Nigeria.
Etisalat Nigeria will also pay a penalty of N360million under similar terms imposed on other operators for default in meeting service quality thresholds within the two months audited by NCC, the regulator said.
NCC says that the same default was also applicable to Airtel Nigeria, owned by Bharti Airtel of India, that is also to pay a penalty of N270million latest by May 25, this year with a condition that, “upon failure to settle the said penalty within the stipulated period, such penalty shall attract a further sum of N2, 500, 000 (two million five hundred thousand naira only) per day for as long as the contravention persists.”
Executive
Vice Chairman, Nigerian Communications Commission (NCC), Eugene Juwah
(in picture) has received the go-ahead from lawmakers to ensure the
sanctioned GSM operators pay the N1.17billion fines
Last year NCC said it waived its threat to sanction the three biggest telecoms networks, MTN Nigeria, Globacom and Airtel, over service quality issues following the outcome of a network audit that revealed varying levels of improvement by the affected service providers.
Director, Public Affairs, Nigerian Communications Commission (NCC), Tony Ojobo, had then announced that tests conducted by the telecoms regulator showed varying degrees of improvement over the last three months of September, October and November this year, a decision that warranted a waiver of the threat to impose sales ban on the three telecoms majors: MTN Nigeria, Globacom and Airtel Nigeria.
According to Ojobo, “In the light of the slight improvements recorded, the Commission would waive the sanctions for the months measured but would not hesitate to apply sanctions if there’s a decline in the current measurements obtained by the Commission.”
NCC says the stance comes in wake of previous notice to the three major networks to issue regulatory direction barring them from adding new subscribers if Key Performance Indicators (KPIs) set for Quality of Service (QoS) was not met.
Ojobo added that NCC had issued the directive following the decline in QoS in the networks and had MTN, Airtel and Globacom of its intention to issue direction if they fail to meet KPIs on service quality including Call Set-up Success Rate (CSSR); Call Completion Rate (CCR); Stand-alone Dedicated Controlled Channel Congestion (SDCCH); Hand-over Success Rate and Traffic Channel Congestion (TCH Cong).
According to him, “Service Providers were given till 30th November, 2011 to meet the above KPIs or be sanctioned. At the expiration of the period given to Service Providers to improve on their networks, the Commission carried out a drive-test to confirm the level of compliance to NCC’s directive. The assessments were for GSM and CDMA services for the months of September, October & November 2011.”
The result of the audit showed that Etisalat and Visafone have been consistent in their improvement towards good quality service provision. While Airtel recorded a significant improvement for the last quarter, Globacom, Starcomms and Multi-links have shown noticeable improvements. MTN and Zoom Mobile however, showed slight improvements, according to the regulatory agency.
He added that NCC, “is aware of the complaints of consumers arising from poor quality of service and this necessitated the directive that was given to the service providers. The over-riding objective of that directive is to ensure that Service Providers continue to invest in infrastructure with a view to ensuring continuous improvement in the quality of service provided.”
The regulator said that the waiver will only last for as long as telecoms operators continue to invest in the improvement of their networks and services offered their subscribers.
According to Ojobo, “the Commission wishes to advise the Service Providers to ensure that the necessary investments are made on the expansion of their infrastructure to be able to cope with the expected rise in voice and data traffic during this festive season. Any further decline in the Quality of Service (QoS) during this season will be unacceptable.”
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