Unlock economic growth with mobile broadband rollout, GSMA tells Nigeria

Ross Bateson  and Sandra Gilligan, Marketing Director GSMA presenting the Analysys Mason  report to the Executive Vice Chairman, NCC, Dr Eugene Juwah

By Prince Osuagwu

After a thorough look at the trends in Nigeria’s telecommunications practice and operations, the Global System for Mobile telephony Association, GSMA, has said that the country can scoop about N862 billion in Gross Domestic Product, GDP, by the end of 2015, from technology alone if it plays according to the rules of the game.
For the association, this is possible and very convenient if the Nigerian government would only support the rollout of Mobile Broadband across the country because government action required to meet high consumer and business demand for Mobile Broadband . GSMA  represents the interests of mobile operators worldwide.
The association’s Special Government Advisor, Ross Bateson, in a teleconference with select Nigerian ICT journalists in Lagos, outlined the findings of a new independent report by analyst firm Analysys Mason and called on the Nigerian government to unlock the 2.6GHz spectrum quickly to support the high demand for Mobile Broadband in urban areas; release the digital dividend spectrum to deliver broadband services to rural areas; and reduce the 35 per cent tax level faced by Nigerian mobile operators. Bateson described the tax as double the global average.
According to the study, only 6 per cent of all Nigerians currently have access to broadband services, and 74 per cent of those do so through Mobile Broadband. There is little fixed broadband connectivity outside of Lagos, and even in Nigerian cities, most cyber cafés now connect to the internet using wireless services. It is widely acknowledged that mass-market broadband availability will only be possible using mobile technologies, and this report highlights the steps the Nigerian government must take to promote Mobile Broadband growth.
According to Bateson “it is essential that the new Nigerian government acts quickly to support Mobile Broadband expansion, as failure to do so could hinder the country’s social and economic growth. Not only could the country realise as much as NGN862 billion of incremental GDP, but people of all ages and livelihoods would benefit from the vast amount of information and opportunities Mobile Broadband can unlock.”
The study found that Mobile Broadband could potentially contribute more than 1 per cent of GDP, or 1.7 per cent of non-oil GDP, as soon as 2015 and will facilitate much needed diversification of the economy.
According to the report, government support for Mobile Broadband services could help deliver significant advantages to the wider wireless ecosystem and the way in which other sectors use the internet:
The report was specific on its predictions, stating that about 55 per cent annual growth would be seen from the online retail industry, growing from NGN4.5bn in 2010 to 44.9bn in 2015; the financial services industry’s benefit from broadband would grow by 95 per cent CAGR, as a result of mobile access to bank accounts and money transfer services, from NGN0.6bn in 2010 to 16.8bn in 2015.
It also said that the use of the internet and mobile to deliver social services, including healthcare and education, would generate growth of 70 per cent CAGR, from NGN2.2bn to 30.3bn in 2015 even as the overall corporate market, especially agriculture and utilities, would experience a 55 per cent annual growth rate through the provision of services online, from NGN3.6bn in 2010 to 32.1bn in 2015.
The report also said that wider availability of Mobile Broadband could also vastly improve overall industrial productivity through improvements in business processes. A 73 per cent annual increase in the working population with access to Mobile Broadband, reaching 5.2 million users by 2015, will deliver an additional NGN140 billion to the Nigerian economy each year.
Meanwhile, for Bateson “mobile is the most cost-effective way of delivering broadband services in Nigeria. Nigeria already has advanced mobile networks, such as Glo’s recently launched LTE network, and has experienced significant take-up of HSPA Mobile Broadband. The laying of submarine data cables between Lagos and Europe has provided much of the international backhaul needed, but mobile is vital in providing last mile connectivity to consumers, especially in rural areas. However, without proper spectrum allocation in line with internationally harmonised band plans and broader government support, it will not be possible to realise the full potential of Mobile Broadband.”