Nigeria needs a proper broadband pricing structure – Danbatta

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Umar Danbatta, Olusola Teniola, KPMG, Broadband

 

By Kester Omu

The Executive Vice Chairman of the Nigerian Communications Commission (NCC), Prof. Umar Danbatta has said there is a need for Nigeria to develop a proper pricing structure, saying such structure would ensure the affordability and availability of Broadband in the country.

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Danbatta stated this today in Lagos at the Digital Bridge Institute, during a stakeholders’ forum on the study of the determination of cost based pricing for retail broadband and data services in Nigeria.

According to Danbatta, not only would a broadband pricing structure ensures affordability, it will also ensure fair competition by checking price discrimination, excessive pricing, predatory pricing, margin squeeze and price fixing amongst other things.

He said the move to have a price structure for broadband is in line with the Commission’s mandate of creating an enabling environment and promoting fair competition in the telecoms industry and in line with the strategic objectives of the National Broadband Plan.

Meanwhile, the NCC has appointed KPMG to carry out the study on the Determination of Cost Based Pricing for Retail Broadband and Data Services Nigeria. The outcome of the report would among other things:

  • To set guidelines for the regulation of the pricing of retail broadband and data services in Nigeria and specifically determine Price cap and floor where necessary;
  • To develop a regulatory pricing model based on the peculiarity of the Nigerian broadband and data services market coupled with international best practices;
  • To design the framework for collation of data that will be used for the Determination;
  • To determine the appropriate cost modeling technique and methodology to be adopted;
  • To determine the appropriate pricing regulatory measures to be adopted;
  • To determine need for ex-ante and ex-post regulation with respect to pricing in the retail broadband and data market segments;
  • To develop a suitable definition of big and new entrant/small operators, if necessary;
  • To conduct a general assessment of the retail broadband/ data market segment with a view of determining the appropriate methodology to be adopted; and
  • To design a cost model that is suitable for determining retail prices for broadband and data services taking into cognizance the macro-economic, technology and technical relevant factors.

Also, it is therefore expected that the outcome of the study will result in:

  • The determination of a uniform pricing structure within the broadband and data segment;
  • Ensuring effective competition in the broadband and data market segment;
  • Guaranteeing affordability and accessibility of broadband and data services in Nigeria;
  • Facilitating inflow, development and growth of the broadband market segment; and
  • The stimulation of further economic growth considering the catalytic role broadband services plays.

 

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