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Telcos Decries High Tower Rentals Cost, Data Tariff

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  • Telcos Decries High Tower Rentals Cost, Data Tariff

High cost of tower rental as well as unregulated data price have conspired to hobble internet service delivery, according to some telecommunications operators and internet service providers.

Tower rental is a business strategy adopted by telecommunications industry where telecommunications infrastructure companies own and maintain towers and allow operators to use at a fee which are usual per annual.

Today, there are three major players in that space: IHS with 14,000 towers; Helios with 2,000 towers; and the new entrant American Towers Company (ATC) with 7,000 towers. David Venn, chief executive officer, Spectranet, a 4G LTE internet service provider, told Nigeria CommunicationsWeek that the two key areas of challenge to internet service providers are data price and high tower rentals.

“Since the botched data floor policy of Nigerian Communications Commission, it has become difficult for ISPs and Telcos delivery internet service to operate profitably. We are seeking the review of that policy by the authorities to enable operators deliver quality service and continue to be in business.”
“Another biggest challenge we are facing today is cost of tower rentals which has continued to increase over the year. It is funny, that international capacity cost has reduced by 50 per cent while tower rental cost is increasing unabated. Imagine a situation where cost of tower rental in three times our salary cost,” he added.He explained that the tower rental contract is usually signed for a period of 5 to 10 years with a clause of annual cost review based on inflation.

“Today, inflation in the country has risen by over 100 per cent necessitating the astronomical increase in the cost of tower rental in the country making the cost in Nigeria the highest in the world,” he said.

He noted that the failure of Multi-Link was as a result of tower rental indebtedness to a tower company-Helios Tower which eventually took over the company.Sunday Folayan, president, Internet Service Providers Association of Nigeria (ISPAN), said that tower rental cost in the country will not be cheap as it is determined by some factors which include number of user on the tower as well as power and security provided in the base stations.

“I’m not surprise that tower rental cost is high because the cost of powering base stations with generators is high. If we fix power problem in this country every other thing will take shape,” he added.

Corroborating Venn on data price, Olusola Teniola, president, Association of Telecommunications Companies of Nigeria (ATCON) added that the industry regulator needs to revisit the data price floor to determine the appropriate data pricing to ensure that investors have certainty in government policies in order for them to bring capital that will be used for infrastructure deployment required for broadband.

“This is important in view of 30 percent broadband target by end of 2018 which we have just over one year to achieve. It is important that the industry sees government policies as one that creates an enabling environment for businesses to thrive so that investors can bring funds to invest for the development of the sector.”

Engr. Gbenga Adebayo, chairman, Association of Licensed Telecommunications Operators of Nigeria (ALTON) also called on NCC to revisit the data floor price determination in order to save and encourage small operators in the sector.

“Data floor price determination is meant for small operators not for big operators who will still survive with the present situation. We are trying to avoid a situation where CDMA operators died because of price war. If data price is determined, it will encourage small operators in the sector. We need to look at it beyond public sentiment and emotions around it and revisit the issue for the growth of the industry,” he said.

CEO/Founder Investors King Ltd, a foreign exchange research analyst, contributing author on New York-based Talk Markets and Investing.com, with over a decade experience in the global financial markets.

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Interswitch is the Most Valuable African Startup

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Interswitch, the leading payment processing company headquartered in Lagos, Nigeria, is Africa’s most valuable start-up at a US$ 1 billion valuation.

Founded in 2002, Interswitch uses switching infrastructure to connect different banks in Nigeria and powered banks’ ATM cards. Presently, the company has over 11,000 ATMs on its network.

In 2010, Helios Investment Partners bought two-thirds of the company and in the following year, Interswitch bought a 60 percent stake in Bankom in Uganda.

Interswitch owns Verve, Nigeria’s most used payment card, and accounted for 18 million of 25 million cards in circulation in Nigeria. The company also owns Quickteller and recently purchased VANSO, a mobile-focused technology provider to banks.

Like Interswitch, Stripe, the company that acquired Nigeria’s Paystack for over US$200 million, is the most valuable startup in the USA at over US$70 billion valuation.

Klarna, Nubank, Paytm and Grab leads in Europe, Latin America, India and Southeast Asia with valuations of US$10.65 billion, US$10 billion, US$16 billion and US$14 billion, respectively.

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E-commerce Black Friday Sales Estimated to Surge by 40% to 10.2 Billion

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The 2020 holiday shopping season will be unique, as the pandemic shifted consumer behavior from retail stores to online shopping. In response, many retailers moved their services online to not miss out on this year’s profits. Atlas VPN team decided to look into how e-commerce sales are set to perform in the upcoming long weekend.

Researchers predict that the US e-commerce revenue will exceed last year’s earnings by 49.5% on Thanksgiving day, totaling $6.18 billion in revenue. Black Friday is calculated to reach $10.2 billion in sales, exceeding last years numbers by 39.4%

Rachel Welch, COO of Atlas VPN, shares her tips on how to stay safe when shopping online during the holiday season:

“Watch out for too-good-to-be-true deals from unknown sellers, as cybercriminals will also expect to turn a profit during the holiday season, even though they are not selling anything, except maybe a bag full of disappointment.”

 Finally, analysis shows that on the last day of the long and full of special offers Thanksgiving weekend, consumers will go all out to bring record sales for e-commerce businesses, adding up to $12.89 billion.

To look at these five days from a wider perspective, e-commerce companies can expect to earn around 39.72% more than they did last year.

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Alibaba Merchants Sell $40B in First Half Hour of Singles Day 2020, More than 2019 Event Full Sales

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Singles Day 2020 was a roaring success, cementing its position as the world’s biggest shopping holiday. Sales across Alibaba’s platforms during the event totaled $74.1 billion, up from $38 billion in 2019.

According to the research data analyzed and published by Stock Apps, within the first 30 minutes of the event, the gross merchandise volume (GMV) surpassed 2019’s full-event sales, reaching $40.87 billion.

Moreover, instead of live events, Alibaba had 400 company executives and 30 celebrities hosting livestreams. Based on a study by Coresight, the Chinese livestream market is set to rack in sales worth $125 billion in 2020, compared to $63 billion in 2019. The US livestream market is a small fraction of that, valued at $5 billion.

China’s Tech Heavyweights Lose $280 Billion in Market Cap

Alibaba Singles Day 2020 dwarfed other major shopping holidays as has been the trend in previous years.

According to Practical eCommerce, Amazon Prime Day 2020 sales totaled $10.4 billion up from $7.16 billion in 2019. Cyber Monday sales in the US amounted to $7.9 billion in 2020 according to Statista. Black Friday and Thanksgiving added $9.7 billion to the figure to make $17.6 billion for the weekend.

Similarly, in 2018, Singles Day sold $30.8 billion while Prime Day sold $4.19 billion and Thanksgiving weekend got $14.2 billion.

However, the 2020 Singles Day event came in the wake of Ant Group’s suspension of a $37 billion listing. The suspension resulted in a $76 billion drop in Alibaba’s market cap, as the tech giant owns a two-thirds stake in Ant Group. Moreover, China’s regulators released anti-trust draft rules prior to the event, aimed at controlling monopolistic behavior.

Following the release, Alibaba shares plunged by 9.8%, as JD.com shed off 9.2%. Tencent similarly saw a 7.39% drop and Xiaomi fell by 8.18%. For the five companies, there was a combined loss of $280 billion in market capitalization.

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