How to Make MVNOs Work in Nigeria, by Experts

Experts in the Nigerian telecommunications sector have charted ways for effective implementation of Mobile Virtual Network Operators (MVNOs) licensing category recently introduced by the Nigerian Communications Commission (NCC).

As industry players converged in Lagos at a conference on MVNOs recently organised by Wireless Technology Labs and Salavence, they spotlighted feasible models to help holders of the MVNO license to make the best out of the new market.

With reference to the theme: From Vision to Reality: Accelerating MVNO Launch and Growth, the stakeholders believed MVNOs bridge digital divide in Nigeria only by getting their operations right.

Latest disclosure by the NCC shows that no fewer than 26 operators have picked various MVNO licences for various tiers.

Speaking at the gathering, Chidi Ajuzie, chief operating officer WTES Projects Limited, said the essence of the MVNO is to bridge the connectivity gap in Nigeria.

He said it is not just taking internet service to rural areas, but also connecting the people in urban areas that are not digitally connected.

Chidi Ajuzie

He said: “So, the plan for most players in the industry is to look for niche opportunities. We have big players like MTN, Glo, Airtel and 9Mobile, who are into voice, calls and data. Although they can also sell voices and data in rural areas, there are still huge niche opportunities there to deepen the ICT space.”

As an advantage, Ajuzie noted that new entrance do not need to build infrastructure from scratch, as they will be riding on what other mobile network operators (MNOs) have already built.

The MNOs now have someone who will help attempt markets that they did not want to attempt and, in the end, earn revenue from it, according Ajuzie.

“It is a win-win for the MVNOs, Telecom and the government as they are now enhancing digital connectivity for the market space and the entire community,” he added.

As he urged MVNOs to engage with the MNOs, he also tasked the federal government to formulate regulatory policies that would enable the MVNOs to thrive as new entrance in the market. He said for a start, the MVNOs should be exempted from tax to enable them compete favorable in the market.

“That will ensure that their upfront cost does not swallow them. They have spent millions on their license fee; they are expected to put in some infrastructure and if they are also expected to pay for taxes, it will become overwhelming for them, hence, the need for the federal government to create tax break for them for some years, before they can start paying.”

Mr. Olushola Teniola, another stakeholder and authority in telecommunications, sees ample opportunities in closing the connectivity gaps in Nigeria via the MVNOs, even for the government.

Engineer Olusola Teniola

He said, “With the new government in place, they will be looking for different streams of revenue and I think the MVNOs brings an opportunity for the industry to be able to capture those streams of revenue.

“We know that the demands of the industry are queit significant, and those demands would only be achieved through collaboration, with MNOs and other critical stakeholders like the WTL and Salavence.

He noted however that there is still infrastructure deficit that needs to be addressed for smooth operation of MVNOs. It is imperative for the MVNOs would need to find partners to help them navigate and overcome the gaps.

Seshan Krishnamurti, Vice President, Africa Business, Covalense Digital, said the NCC has done a good job by issuing licenses to MVNOs.

He said the MVNO model would further make a statement for technology in transforming lives of those that are digitally disconnected or underserved.

“The MNOs are already there. They have the money, the experience and the system. However, they have limitations in that there are still places that are not digitally connected, hence the need to partner with the MVNOs, to make big difference to the people.”

He recalled that during the two years of COVID, people dropped out of schools and business were closed. “But with technology, we now see more people working from home. Meanwhile, there are others who were not connected to the internet and their daily livelihood were halted as a result of that.

“But the MVNO is here to change the narrative. With MVNOs, the elderly in the village can have access to quality healthcare, through telehealth. So, in essence, MVNOs is about making a difference in people’s lives.”

He however urged MVNOs to collaborate with MNOs and other stakeholders, saying that they should ensure that to carry the MNOs along to know, for instance, the villages that may need their services.

“They also need to partner with other stakeholders such as Salavence to know how the ecosystem is going to get value and we plan a part in the ecosystem,” Emeka said.

He advised the holders various MVNO licences to understand the customer market segments, get the right advice, and adopt the right kind of strategy and planning.