Nigerian connectivity company BCN was awarded the Infraco licence for the North West Zone of Nigeria. Russell Southwood spoke to BCN’s CEO Ibrahim Dikko about how this changes the company from an Abuja operation to a national connectivity provider.
Nigeria’s regulator NCC has been slowly rolling out Infraco licences to incentivize the development of fibre infrastructure across the whole of Nigeria. The licences are meant to address two priorities. Firstly, ensuring that there is sufficient metro connectivity in the country’s major urban areas and secondly, ensuring that less well connected regions of the country get better fibre connections to enable them to access data as users elsewhere in the country are doing.
“The Infraco licences are basically a means to extend broadband infrastructure to every local Government area across the country and to facilitate this, NCC divided the country into seven regions. The idea is to have Open Access, non-discriminatory network in layers 1 and 2 in the prescribed regions.”
In addition to BCN’s Infraco licence for the North West, Zinox Technologies was granted one for the South East and Brinks Integrated Solutions for the troubled North East. In 2017 MainOne was awarded the Infraco licence for Lagos while IHS got one covering North Central (including Abuja).
The licences are granted on an Open Access model that forms part of the National Broadband Plan (2013-2018). This envisaged Nigeria achieving 30% broadband provision by 2018. Professor Umar Garba Danbatta, Executive Vice Chairman of NCC said in a speech in February 2017 that the broadband penetration rate was 21%.
The North West zone has a population of around 35 million and includes the states of Jigawa, Kaduna, Kana, Katsina, Kebbi, Sokoto and Zamfara. All of these states have largely agricultural economies. Kebbi has a plan to produce 70% of Nigeria’s rice requirement. The largest urban centre is Kano which among other things has the very large Ado Bayero Mall.
According to BCN’s CEO, the company is “a unified communications solutions provider operating in layers 1,2 and 3. It is focused from an integrated infrastructure perspective – including a data centre as part of its plans – providing solutions across the value chain.”
It has 2000 kms of fibre in the North of the country, including a metronet in Abuja and 1,200 kms across North Central Nigeria. It will be launching 3 new metronets in Kaduna this year, as well as opening a new data centre there. The Infraco Licence (which is for 20 years) will see it roll out 10,000 kms of fibre access across the North West over the next 4 years.
“In order to incentivize the licencees into unserved areas the Government will make an agreed capital contribution on delivery of roll-out milestones. It forms part of the National Broadband Plan and the Government’s wider objectives for cashless banking, financial inclusion, better services for citizens and the need to move to greater digitalization. It is also hoped that it will stimulate parts of the economy and that’s a key developmental objective.”
The capital for the whole plan has been calculated at US$250 million, of which the Government is expected to make a 40% contribution of US$100 million. The network will include both metronets and long-distance fibre. It expects to lay the first fibre in Q1, 2019.
There will be 500 POPs in places like Sokoto and Katsina and they will be connected to each other down to local government headquarters level. It will help connect key public sector services including education, health and other Government services. Also provate corporates will have access to the core network in urban areas.
So do the mobile operators see this network as competing with their own networks?:”I can’t speak on their behalf but I assume they will see it as complementary to their own networks.”
“Some of the technologies they are using are becoming obsolete and more expensive to operate. They need to upgrade them from 2G to 4G, particularly in the state capitals. The network will allow them to upgrade their services, link base stations with fibre and have redundant networks. We’re not seeking to duplicate infrastructure”.
“We’re looking to integrate and have greater optimization of assets. It’s a win-win and I think they will realize it. For them, this will best be done by companies like us. This is much more optimum. We’ve seen it on the tower side of the business where they have outsourced to other companies.”
So what’s the overall state of the wholesale market in Nigeria?:” The recession has made people reflect and become more efficient in their operations. People are looking into technology with greater interest in how they can use it to achieve efficiencies, both in Government and the private sector. We’ve seen some growth and more interest band there will be a higher level of growth as these turnaround strategies kick in. There’s great potential going forward.”
BCN has begun to move from being just a small player in Abuja to having wider national aspirations with its new licence.