The Nigerian Communications Commission, NCC, is to develop a new and proper pricing structure for high speed internet services in Nigeria, ahead of the revolution of massive broadband availability in the country. The move is in line with the Commission’s mandate of creating an enabling environment and promoting fair competition in the telecoms industry and in line with the strategic objectives of the National Broadband Plan.
The NCC said this will not only ensure the affordability and availability of Broadband but also provide fair competition by checking price discrimination, excessive pricing, predatory pricing, margin squeeze and price fixing amongst other things.
To bring this about, the NCC Executive Vice-Chairman, Prof. Umar Danbatta, at a ‘Stakeholders Forum on the Cost-Based Pricing for Retail Broadband and Data Services’ in Lagos, last Wednesday, announced that the commission has appointed Messers’ KPMG to conduct a study on the matter.
Prof. Danbatta explained that KPMG Professional Services, among other things would set guidelines for the regulation of the pricing of retail broadband and data services in Nigeria and specifically determine Price cap and floor where necessary; develop a regulatory pricing model based on the peculiarity of the Nigerian broadband and data services market coupled with international best practices; design the framework for collation of data that will be used for data market segments.
The top NCC official noted that the Nigerian telecommunications industry has undoubtedly recorded significant growth over the years and the impact and benefits that come with this growth cuts across every segment of the Nigerian economy and the lives of its people.
In his words, “While the Commission is happy with this phenomenal growth recorded in the industry, especially in active voice subscriptions, we believe that the next critical phase is to ensure that everyone – wherever they live, and whatever their circumstances – have access to the benefits of broadband’’.
Prof. Danbatta argued that while addressing market dominance issues in the upstream sector, wholesale markets should be one of the ways to facilitate competitive price levels in retail broadband access and service markets. He noted that such action might not be sufficient constraint on pricing in all segments of a retail broadband market, “as such some form of ex-ante regulation of retail prices is appropriate or even necessary.”
