Stakeholders, NCC Disagree over VAS Market Draft Rule

Emma Okonji

The Nigerian Communications Commission (NCC) and Stakeholders in the telecoms industry, Wednesday in Lagos, openly disagreed over some sections of the draft regulatory framework on value added service (VAS) prepared by the NCC.

The stakeholders had expressed their displeasure over some aspects of the draft regulatory framework on VAS, insisting that more inputs were needed to make the policy workable.
Owing to the potential of VAS market in Nigeria, whose value is estimated at over N300 billion with some 200 licensed players under the auspices of the Wireless Application Service Providers of Nigeria (WASPAN), the stakeholders said their inputs were needed in the draft policy, to make it all encompassing.

The stakeholders who spoke on the need for a wholistic policy framework, vowed not to be maginalised in the business of value added services in Nigeria.

But in a presentation on the draft framework at an industry consultative forum organised by the NCC on Wednesday, NCC consultant, Mr. Stephen Bello, explained that key areas have been clearly addressed by the regulator with respect to the draft policy.

Bello said the telecoms industry has been restructured into VAS and content developers; VAS hosting and service providers; and Mobile Network Operators (MNOs), saying that the aggregators would now be paying new licence fee of N10 million renewable after five years.

Other areas explained by Bello, which the regulator has come up with improved interventions include the unbundling of VAS for cost sharing, the decision for NCC to become the sole generator of short codes to operators to be renewed yearly, blockage of any text messages without properly registered caller ID to nip in the board the rising wave of unsolicited SMS, unwanted mobile adverts, among others.

However, VAS providers under the auspices of WASPAN, disagreed with the regulator on some sections of the policy draft which they argued could stifle competition, disrupt the current market structure and work against national interest of local content policy.

The National Coordinator of WASPAN, Mr. Chijioke Ezeh, noted that current VAS model has been in place since 2001 with periodic changes as various stages of the market expansion occurred. He also said they were in agreement with positive change such as the intentions of the NCC proposed changed to the status quo of the industry.

He however raised concerns on how the new policy draft could hinder competition, lead to loss of jobs and be against local content policy, breed collapse of Nigeria VAS companies, unnecessary decimation of the digital industry, dearth of innovation, work against market evolution, constitute potential risk to national security.

According to him, while the NCC’s intention was well-conceived to regulate the industry, more time was needed to accommodate more views, especially from WASPAN, in order to have an industry friendly policy that addresses all the various aspects of the nation’s telecoms VAS market.
Other VAS stakeholders including the Managing Director of CreditSwitch, Mr. Tayo Adigun and the Chief Executive Officer, L5 Lab, Mr. Chika Nwobi, disagreed on the the N10 million licensing fee introduced by the new policy, saying most players are smaller players that will not be able to pay such fee.

President, Association of Licensed Telecoms Operators of Nigeria (ALTON), Mr. Gbenga Adebayo said some provisions in the draft policy have implications for threat to new investments, market upheaval, impacts on job creation and economic growth, national security concerns and legal liability issues.

The Executive Vice Chairman of the NCC, Prof Umar Danbatta, said the purpose of the gathering was to reflect on the draft regulatory framework for the provision of VAS in Nigeria in another demonstration of the Commission’s commitment to its Eight-Point Agenda unveiled early in the year to further develop the industry.