My predecessor almost denied Nigeria $1.2bn revenue from telecom. He wanted to give the licences to his friends for $3m each- Obasanjo
Former President Olusegun Obasanjo has narrated how Nigeria almost missed the opportunity to record approximately $1.2bn from the telecom sector at the time Nigeria licensed digital mobile communication operators.
Obasanjo said his predecessor was going to give the licences to his friends for a paltry sum of $3 million before he intervened and opted for an auction to the highest bidder.
The auction process ended up giving Nigeria a revenue of $1.2bn in telecom license fees from major operators, including MTN, Globacom, Econet (now Airtel), and Etisalat (now 9mobile), during the inception of mobile technology in Nigeria.
These license fees played a vital role in establishing the telecom industry in 2000, a sector crucial to Nigeria’s economy.
The former president was speaking at the book launch and exaugural lecture of former Editor of The PUNCH, Dayo Oketola, in Lagos on Tuesday, September 17, 2024.
It would be recalled that the last entrant to the digital mobile licence race, Etisalat, paid a substantial $450m for its licence.
This strategic move generated a total of $1.2bn to the Federal Government through the Nigerian Communications Commission (NCC).
“When the first three mobile telecom companies came in, they were offered licenses. The cost of one of these licenses was $280m, but soon, the same license was going to be offered for just $3m by some individuals in the previous government who wanted to give out these licenses to their friends for just $3m,” Obasanjo said.
Obasanjo emphasised the need to continue to create the right conditions in the sector to attract future investments and sustain its growth.
“There are still opportunities today for Nigeria to attract investments, but the right conditions need to be created for that money to come in again,” he stated.
MTN, a South African firm, began operations in Nigeria in August 2001 and quickly became a market leader. Globacom entered the market in 2003, introducing a pioneering per-second billing model that compelled MTN and Econet to follow suit.
Econet Wireless Nigeria, launched in 2000, initiated commercial GSM services on August 5, 2001. In 2007, Emerging Markets Telecommunications Service, trading as Etisalat, joined the Nigerian telecom market.
Speaking further, he acknowledged that the competition among operators (MTN, Econet, Glo) significantly shaped the sector.
“We achieved competition. The three of them were competing. And of course, the one who had the upper hand in terms of spread, I think, was MTN, followed by Glo and then there was Econet. Econet quarrelled among themselves a bit, but eventually, they sorted themselves out. Well, when they came, they came last,” the ex-president stated.
The former head of state recounted how Nigerians faced considerable challenges with limited infrastructure, securing fewer than 500,000 phone lines despite extensive investments.
“The story of communication telecommunication, particularly mobile communication telecommunication, was a very interesting one, because before mobile telecommunication, we’d done a lot of things.
“We spent a lot of money. We had had companies we had invited (companies) from America, from France, even from Britain, and we did not get more than 500,000 lines with all that we had done, and people had to queue at the telephone office,” Obasanjo stated.
Oketola’s book titled ‘The Catalyst: Nigerian ICT Evolution Through a Journalist’s Lens,’ was formally unveiled at the well-attended occasion at the Muson Centre, Onikan, Lagos.
Some of the dignitaries at the event include former Minister of Transportation, Rotimi Amaechi; the Lagos State Commissioner for Information and Strategy, Gbenga Omotoso; President, Nigerian Guild of Editors, Eze Anaba, and the chairman, Editorial Board, The Nation, Sam Omatseye.
The Minister of Information and National Orientation, Alhaji Mohammed Idris, was also represented at the event.
The founder of the Love of Christ Generation Church C&S (Worldwide), Revd. Esther Ajayi, was also present.
