SNO is ready to go, but launch date remains a mystery

19 Aug 2003

Nigeria’s second national operator (SNO) Globacom is keeping the country guessing as to when it will launch its long-awaited mobile services in the country. According to local media reports, hype is building in Lagos as the company’s PR offensive kicks in, though no one yet knows what the exact launch date will be. In May the telco announced that it had appointed 350 dealers to staff its eye-catching lemon and green ‘Glo Shops’ and last week publicity shots of the network’s ‘palm tree-styled’ masts were sent out to an expectant local press. ‘The company is keeping the actual date very close to its chest,’ a company official told local journalists. ‘Let’s just say that we are set to go but we don’t want to give a specific date and not be able to meet it’. The telco is to launch GSM services initially in Lagos, Abuja Port, Harcourt, Ibadan and Ijebu Ode. It is expected to kick-start competition in the sector and raise connection standards whilst driving prices down, though many analysts doubt this will become a reality. The three current mobile players – MTN, EWN and NITEL – have an agreement in place to preserve a fixed interconnection charge of NGN18 per minute, meaning that Globacom could run into stiff opposition to lowering charges. Despite this, the telco is reassuring potential customers that it will provide a cheaper service, insisting it has a few surprises in store.

Globacom, majority owned by local petrochemical company Conpetro, was awarded the SNO licence in August 2002. Besides the country’s crucial fourth mobile licence, it also contains concessions for the local access and long-distance markets, and a licence to operate an international gateway. Although the SNO was originally intended to be created after the privatisation of the incumbent NITEL, the collapse of that process brought the urgency for an SNO to the fore. Four applications were submitted for the licence which was to be allocated by competitive auction, but because Globacom was the only one to pay the deposit and qualify to bid it was granted the licence by default at the reserve price of USD200 million. The roll out obligations contained in the SNO licence mirror those imposed on NITEL and require Globacom to deploy a minimum of 150,000 lines within 12 months, 550,000 lines within 30 months, and 1.2 million lines within 60 months. Additionally, in order to ensure that all parts of the country are covered, the obligations require that the SNO provides at least 1% of its installed capacity in each of the 36 states in the country. Globacom reportedly awarded a USD10 million frame agreement to Alcatel within several months, which comprises the roll out of 10,000-km of fibre-optic transmission backbone, 100,000 fixed wireless lines, and the immediate roll out of a million GSM lines.

PriMetrica's Yearbook of African Telecommunications 2003