At just 40 percent, broadband penetration in Nigeria is low. An attempt by the federal government to improve this through a new Right of Way (RoW) policy is however being rejected by state governments.
What’s happening: The Federal Government recommended a policy to harmonize Right of Way (RoW)/site acquisition plan by states across the federation.
- Right of Way is the process through which telecoms operators obtain legal permission from state governments to lay infrastructure in their states at a cost.
- Right now those prices are all over the place. States are charging premium rates which discourages the telecom operators from investing.
- So, in its revised National Broadband plan (2020-2025), the FG recommended a uniform price of 145 naira per meter as the charge for Right of Way across all states of the federation. But state governments are not falling in line.
- Only Katsina, Lagos [somewhat], Ekiti, and most recently Imo state have complied with the prescribed 145 naira per meter charge.
For the dissenting states, the RoW charge presents an opportunity to generate quick revenue from telecom operators and bridge the widening gap between their earnings and financial obligations.
- Check out: Five states with the highest RoW charge per meter are: Osun [5,609 naira], Kwara [5,500 naira], Anambra [3,620 naira], Rivers [3,045 naira], and Abia [3,000 naira].
- Telecom operators need thousands of kilometres Right of Way to lay their fibre optic broadband cables for internet broadband connectivity. Having to pay thousands for every single meter may be crippling.
Why it matters:
- The Federal Government’s proposal for a reduction in the charges is driven by the intent to lower investment cost for telecom operators. A lower cost will ensure the operators can expand and more Nigerians can be connected.
- The narrow view by states is bad for innovation, business, diversification of the local economy, job creation, and revenue generation. It takes a huge toll on the quality of connectivity available in these states.
- Internet availability and affordability inform the choice of location by startups and other professionals who are prospective taxpayers, not to mention the impact their services have on the standard of living.
What they are saying: Ekiti State appears to have recognized these benefits. Ekiti State Governor, Kayode Fayemi, said concerning the reduction in RoW charge: “Broadband connectivity across Ekiti state will enhance the ability of the government of Ekiti state to increase economic prosperity; attract new businesses, enhance job growth, extend the reach of affordable, high-quality healthcare, enrich student learning with digital tools, and facilitate access to the digital marketplace.”
Jude Feranmi of First Tech and Innovation Policy Advisory: “Higher broadband penetration means most people can afford to work from any state instead of the commercial hubs of Lagos and Abuja. It also means jobs for youths by companies who will rather choose to have their digital centers outside of these urban centers which are more expensive and more stressful to do business. More jobs translate to a growing local economy, which will be mostly formal and generate revenue for the government in the long run.”