Three network operators, MTN, Airtel, and Mafab Communications have emerged as bidders for the 3.5 GHz spectrum for 5G deployment. The three companies will battle for the two lots of 3.5GHz spectrum which the Nigerian Communications Commission (NCC) has scheduled to hold December 13, 2021 in Abuja.
The operators were able to beat the deadline for the Expression of Interest (EoI) to bid for the country’s 3.5GHz spectrum licence, which closed on Monday, November 29 by 5pm.
Sources from within the telecom companies, the three companies have met all the pre-bid criteria, which include payment of a non-refundable 10 per cent the reserve bid price. The Commission in the Information Memorandum (IM) for the spectrum auction had fixed N75 billion as the reserve price.
With this, each of the three operators pre-qualified for the bid has paid N7.5 billion each as an initial deposit, amounting to N22.5 billion.
While MTN and Airtel are old players in the market, Mafab Communications will be coming as a new player, if it succeeds in the auction.
According to the IM, “To qualify to bid in the Auction, the Applicants will not have to be Licenced Network Operators in Nigeria. However, any successful Bidder who does not have a Unified Access Service Licence (UASL) will be granted one upon payment of the specified fee. The tenure for the UASL will be Ten (10) years, subject to renewal.”
The Commission added that “where a winner does not hold a Unified Access Service Licence (UASL) which is the Operational Licence for the frequency Spectrum slated for auction, it will be issued at an additional fee of Three Hundred and Seventy-Four Million, Six Hundred Thousand Naira only (N374, 600,000.00) or at the subsisting licence fee at the time of the auction.”
At a forum earlier in November, the operators had complained that the reserve price of N75 billion was too high, sparking the fear that the bid may be boycotted by the operators. Speaking at the forum organised by the NCC, the Chairman of the Association of Licensed Telecom Operators of Nigeria (ALTON) Engineer Gbenga Adebayo expressed his concern over the reserved price.
Speaking on behalf of the telecom operators, Adebayo said though the industry was committed to supporting the NCC to achieve its goals, the operators are a bit concerned about the cost of 5G and the issue needs to be dealt with going forward.
Individual operators who also spoke at the forum frowned at the high cost of the spectrum and appealed to the NCC to reduce it.
While the reserved price is N75 billion, the operators may be paying more than that if many operators showed interest in bidding. According to NCC, new entrants are allowed to participate in the auction in addition to existing licensees. This means that new investors with deep pockets could bid higher in order to snatch the spectrum from the existing operators.