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New Guidelines For GSM Licences (Posted Dec 2000) Tell your friends about this page! Email it to them. 

By the middle of next year four operators of digital mobile service would have started operations in Nigeria. These are the government-owned NITEL/M-Tel and three private operators. The private operations will be made known after the auction exercise scheduled for January 17, next year. Mr. Ernest Ndukwe, executive vice chairman of the National Communications Commission, NCC said applications will be received this month (December) and interested companies would be expected to pay $20 million non-refundable deposit by December 15. A bidder can, however, lose that deposit and a chance to participate in the auction. That is if any member of its bid team is caught communicating with a member of another bid team on details of its bid.

Not only that, bidders could also incur the wrath of the commission if any of their representatives uses any communication device on auction day. This may attract a fine of $100,000. It could also lead to the exclusion of the bid team from the auction exercise. The $20 million deposit is an increase on the $10 million initially announced by the commission.

The bidders will also furnish the NCC with information on corporate structure. The NCC will commence pre-qualification processes by December 22 and give notice of auction of January 12, 2001. Successful bidders at the January 17 auction will be announced in February. And winners would have 14 days, from the date of announcement, to pay in $20 million to NCC, as part of the "Reserve price" of $100 million. But while any bidder that satisfied these conditions earns the commissionís licence to operate, it cannot yet provide mobile services until May. This, according to Ndukwe, is to ensure that none of the operators is given undue advantage over another.

The authorities want all operators to start at once. Operators will be allocated frequencies on 900 and 1800 mega hertz. This is to give a wide spectrum to operators. Even then, the government would still work towards a further growth of the teledensity. Interested companies need not worry about the capital needed to establish transmission network if they donít have. They will be allowed to use NITELís trunk transmission network. However, if any of them has the wherewithal to set up its own network, the co-operation of the authorities is guaranteed. Ndukwe said operators will be given free hand to "set up their own long distance intercity transmission links for the purpose of inter connecting their mobile network areas". A successful conclusion of the exercise will bring to an end the delayed attempt at issuing out licences for interested operators of digital mobile services.

An attempt by M-Tel, the government-owned cellular operator, to secure a licence for the Global System for mobile Communication, GSM system failed last year when the company could not pay the required $10 million administrative charge. Yet M-Tel has about 20,000 lines capacity and claims to have installed a 1000-line experimental GSM network. So even though it has to wait for others till May next year M-Tel appears to have an edge over its competitors. It has already started an authentication of its handsets, to prevent cloning. It is also planning to re-introduce the International Direct Dialling (IDD) on cellular phones. This will expand its reach and it could be a major attraction to subscribers. The company also carried out a test run of its GSM services in Abuja. So far M-Tel is the only Nigerian company that is a member of GSM association, because it fulfilled the requirements of the global body. There is, however, one thing that M-Tel has been fighting with. It is, like most public companies, being owed by most of its subscribers. The management said its sub-scribers may have to pay in advance for its services if it is to solve that problem.

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