WTES Project Limited, the concessionaire handling the Lagos State Unified Duct Infrastructure Project, has explained that the project will reduce the infrastructure cost for telecommunications operators in the state by 50%.
The explanation comes amid concerns expressed by industry stakeholders who are worried that the project may create a monopolistic situation.
GSMA, the global body representing the interest of all mobile network operators, had warned that a project as big as the Lagos fibre duct could create a monopoly as the price of the lease is often determined by the single owner of the infrastructure.
What they are saying
Speaking with Nairametrics, the Chief Operating Officer of WTES, Chidi Ajuzie, explained that the concession agreement with the Lagos State Government is for 25 years, after which the government will either extend the agreement or take over the infrastructure. He said:
- “WTES has a 25 years concession arrangement with Lagos State Government to build an open duct infrastructure. As we build, every operator comes in and leases that infrastructure to provide services. With this project, we have taken off 50% of the cost the telecom operators would have incurred in building their infrastructure. So, we built and they just come to us to lease.”
When asked how this will affect MainOne which was licensed by the Nigerian Communications Commission (NCC) to deploy broadband infrastructure in Lagos, Ajuzie said:
- “We are not a licensed InfraCo. We are just to build and lease. The licensed InfraCo can come to us as the infrastructure owner and lease. They can also build their own, but the mindset is that there is no need for duplication since someone has already built it.”
Meanwhile, Lagos State is implementing a ‘dig once’ policy which prevents the fragmented and constant digging of state roads by different telecom operators and Internet Service Providers (ISPs). This means that all telecom operators in the state, including the licensed InfraCo, are conditioned to lease from WTES.
Pointing out the disadvantages of such projects, usually referred to as Single Whole Network (SWN), the Head of GSMA Intelligence, Peter Jarich said:
- “SWNs are generally defined as government-initiated network monopolies, compelling operators to rely on SWN-delivered wholesale services as they serve and compete for customers. Like network sharing arrangements, SWNs often purport a rationale based on reducing both network CAPEX requirements and end-user service costs, driving uptake in the process. Unlike sharing agreements though, SWNs are mandated, they are not voluntary and do not give operators the flexibility to determine the best arrangement for sharing.”
What you should know
- On May 14, 2020, the Lagos State House of Assembly approved the unification of fibre infrastructure for telecom companies in the state. This meant the deployment of a single cable duct for all telecom companies and other utility providers operating in the city.
- The Lagos State Unified Duct Infrastructure Project (LASG-UDIP) is part of Governor Babajide Sanwo-Olu’s smart-city initiative,
- Across the state, there has been notable construction of ducts and subsequent deployment of cables along major roads and streets in the citywide Internet connection.
- At the end of the project, some 6,000km of fibre optics cables are expected to be laid. This is expected to unify the city’s cable network, and with it, the government is expected to effectively overhaul the current telecommunications ecosystem in the state.
Another govt monopoly & family business loading….when will we understand that competition makes things better….creates more jobs and reduces prices? Govt should just build the ducts once….and let any company that wants to lay fiber or even power cables lay them in those ducts and pay govt a fee for using the ducts….to lay the fiber in already built ducts won’t need the road / street to be dug up….you use a cable layer device in the ducts from man hole to man hole…
But as usual – some few people want to be gatekeepers for personal gain and to the detriment of society at large….