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The arfticle is all about lthe poor jserfvice given to Ni gerfians by the Telecommunication companies

Submitted: May 06, 2008

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Submitted: May 06, 2008





PERHAPS, government officials who were quoted to have declared in the 1980s that telephones are not meant for the poor did not really mean to sound arrogant. Apparently, they spoke within the context of the prevailing environment: Telecom services at the time were provided by one massive monopoly wireline operator, owned by the government.

Incidentally, a consideration of the poor also tended to run through the minds of investors, financiers and telecom industry analysts in the run up to the GSM auction in Nigeria in 2001. Nigeria may be a rich country resource-wise, but in real terms, it is a poor country. The vast majority of our people are poor. Mobile communications on the other hand is a relatively expensive service especially in comparison with the wireline service. Could poor Nigerians be expected to own and maintain mobile phones which are relatively more expensive to manage than land lines? Could a country with such predominance of the poor be expected to provide a market buoyant enough for mobile phone companies to thrive? Many informed telecom industry operatives out there, did not think so.

The reality of the GSM sector performance has continued to defy all projections and indeed turn conventional business thinking on its head. Rather than a couple of million telephone subscribers, each of the privately-owned GSM networks has reportedly so far connected well in excess of 10 million active subscribers. As it is in Nigeria, so has it been in other African countries - Congo, Sudan, Chad, Benin, Somalia, Uganda and many more. With varying but impressive levels of telecom penetration, even the world's poorest countries are demonstrating that telephones are meant for everyone, rich and poor.

But what has been the secret? Why is telecom such a hit in developing countries? How have multinational companies rewritten the business model and created new paradigms of success even in the poorest countries of the world? One answer would lie in the fundamental nature of communication itself. Rich or poor, everyone needs to communicate. Another would lie in the massive pent-up demand in many developing countries including Nigeria, sequel to the failure of the erstwhile government monopolies hitherto saddled with responsibility to provide telecom service..

In being profitable, however, these telecom companies are spearheading a wave of economic growth and development in these countries, Nigeria included. It is no longer a novelty to see a plumber pausing in the course of his work, to answer his GSM phone and obtain details from a potential customer for a new job to be carried out. The fish seller in the rural town of Epe, near Lagos in MTN's advertisement no longer needs to wait for customers to come to her before she can dispose of her stock. She can reach all her customers and potential ones too, from the comfort of her home, using her GSM phone.

Not every poor person, however, has been privileged to own a mobile phone. Truth is, despite the rapid spread of the mobile phone and its increasing adoption by the poor in Nigeria and elsewhere, total cost of ownership remains considerably high, impacted upon by extraneous costs such as power, security and other logistics. Notwithstanding, ingenious schemes such as the ubiquitous umbrella call centres scattered across our country help to ensure that even those who cannot own phones or who may not possess the means to use their phones on a continuous basis, continue to remain a part of the telecom revolution.

The dividends of telecommunications will continue to percolate even further down the social pyramid if operators remain profitable. If telecom operators can continue to demonstrate that operating in poor countries makes good investment sense, then they will be in a position to attract financing from across the world. Access to substantial financing is vital in the highly capital-intensive telecom industry and will in turn, enable telecom operators extend services to even remoter and poorer communities across Nigeria and other parts of Africa. In the process, the economic multiplier effect which these companies spawn will become even more pervasive.

And how can we help to ensure that these telecom companies remain profitable? By helping provide the proper institutional frame work for the larger telecom industry to thrive. An environment in which policies are rigorously thought out before they are implemented, and in which they are subject to regular appraisal in line with market place realities and the growth imperative of the economy. Such policies will involve industry stakeholder participation and should support free and unfettered marketplace competition and regulatory transparency.

Nigerians need to appreciate that telecoms proffers a win-win scenario to the country and that making profit is vital to the sustenance of the wave of change which privately-owned companies are stimulating. With the right institutional framework in place and the support of Nigerians, telecom penetration in Nigeria will continue to confound experts who once thought telephones are not for the poor and those who thought it was foolhardy to invest in Nigeria.

© Copyright 2018 Omotayo Oladele. All rights reserved.

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