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Adoption of OTT Will Ground Telecoms Operations, Operators Cry Out



  • Adoption of OTT Will Ground Telecoms Operations, Operators Cry Out

Telecoms subscribers under the aegis of the Association of Licensed Telecoms Operators of Nigeria (ALTON) have again raised the alarm that the increasing adoption of Over the Top Technology (OTT) services, being rendered by social network operators, using voice and instant messaging, will cripple telecoms business in Nigeria, if unchecked.

The OTT services are rendered by social network providers who ride on the infrastructure of Mobile Network Operators (MNOs) like MTN, Globacom, Airtel, among other GSM operators, to offer free voice and instant massaging services such as: WhatsApp, WeChat, Skype, Facebook, Viber, Imo, at no cost to the subscribers.

Chairman of ALTON, Mr. Gbenga Adebayo, who raised the alarm, said the social network operators do not invest in infrastructure, but ride on the infrastructure of MNOs to provide free services to customers at the detriment of MNOs, who have invested so much to build their infrastructure and are still investing in the maintenance of such telecoms infrastructure.

He said the new development is causing MNOs to lose revenue strings hitherto coming from their voice and data services, because subscribers now prefer to patronise the social network operators who provide the services at no cost to the subscriber, yet they ride on the MNOs infrastructure to provide the free voice and instant messaging services.

According to Adebayo, “The increasing adoption of OTT applications by telecom subscribers negatively impact on incoming international traffic as well as SMS at huge cost to the telecoms operators, but revenue to OTT service providers.

“OTT players also hold much customers’ personal data they can use for any desired purpose without risk of being sanctioned by the government while Telcos are not permitted to use or disclose subscriber information to third party.”

Adebayo said current data shows that voice minutes have been declining due to impact of OTT. Voice Minutes has been declining while voice over Internet (VoIP), which the social network operators provide, has been increasing, and OTT Data flux has been increasing as shown with the 2016 data.

He said traditional telecoms operators are losing money due to this trend, and called for urgent action to save the operators further loss due to activities of OTT players who do not invest in infrastructure.

Comparing OTT and Mobile Network Operations, Adebayo said OTT Operators offer the same services as the operators, but argued that their services are neither subject to licensing under the NCA nor have any contractual obligation with telecommunication operators in terms of interconnection.

He said the traditional telecoms operators have contributed so much to the Nigerian economy since the inception of GSM in 2001, and should not be allowed to go under. Telecoms has contributed over $68 billion to foreign direct investment FDI in the past 16 years, and also a major employer of labour having created over 30,000 direct job opportunities and over 500,000 indirect job opportunities.

The OTT players have no traceable address in the country, which makes little or no contribution to the nation’s direct economy either in employment generation, payment of taxes, among others, Adebayo said.

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


Gold Hits Eight-Month Low as Global Optimism Grows Amid Rising Demand for Bitcoin



Gold Struggles Ahead of Economic Recovery as Bitcoin, New Gold, Surges

Global haven asset, gold, declined to the lowest in more than eight months on Tuesday as signs of global economic recovery became glaring with rising bond yields.

The price of the precious metal declined to $1,718 per ounce during London trading on Thursday, down from $2,072 it traded in August as more investors continue to cut down on their holdings of the metal.

The previous metal usually performs poorly with rising yields on other assets like bonds, especially given the fact that gold does not provide streams of interest payments. Investors have been jumping on US bonds ahead of President Joe Biden’s $1.9 trillion coronavirus stimulus package, expected to stoke stronger US price growth.

We see the rising bond yields as a sign of economic optimism, which has also prompted gold investors to sell some of their positions,” said Carsten Menke of Julius Baer.

Another analyst from Commerzbank, Carsten Fritsch, said that “gold’s reputation appears to have been tarnished considerably by the heavy losses of recent weeks, as evidenced by the ongoing outflows from gold ETFs”.

Experts at Investors King believed the growing demand for Bitcoin, now called the new gold, and other cryptocurrencies in recent months by institutional investors is hurting gold attractiveness.

In a recent report, analysts at Citigroup have started projecting mainstream acceptance for the unregulated dominant cryptocurrency, Bitcoin.

The price of Bitcoin has rallied by 60 percent to $52,000 this year alone. While Ethereum has risen by over 660 percent in 2021.


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Crude Oil

Oil Prices Extend Gains to $64.32 Ahead of OPEC+ Meeting




Oil Prices Rise to $64.32 Amid Expected Output Extension

Oil prices extended gains during the early hours of Thursday trading session amid the possibility that OPEC+ producers might not increase output at a key meeting scheduled for later in the day and the drop in U.S refining.

Brent crude oil, against which Nigeria oil is priced, gained 0.4 percent or 27 cents to $64.32 per barrel as at 7:32 am Nigerian time on Thursday. While the U.S West Texas Intermediate gained 19 cents or 0.3 percent to $61.47 a barrel.

“Prices hinge on Russia’s and Saudi Arabia’s preference to add more crude oil production,” said Stephen Innes, global market strategist at Axi. “Perhaps more interesting is the lack of U.S. shale response to the higher crude oil prices, which is favourable for higher prices.”

The Organization of the Petroleum Exporting Countries (OPEC) and allies, together known as OPEC+, are looking to extend production cuts into April against expected output increase due to the fragile state of the global oil market.

Oil traders and businesses had been expecting the oil cartel to ease production by around 500,000 barrels per day since January 2021 but because of the coronavirus risk and rising global uncertainties, OPEC+ was forced to role-over production cuts until March. Experts now expect that this could be extended to April given the global situation.

“OPEC+ is currently meeting to discuss its current supply agreement. This raised the spectre of a rollover in supply cuts, which also buoyed the market,” ANZ said in a report.

Meanwhile, U.S crude oil inventories rose by more than a record 21 million barrels last week as refining plunged to a record-low amid Texas weather that knocked out power from homes.

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Crude Oil

Oil Dips Below $62 in New York Though Banks Say Rally Can Extend




Oil Dips Below $62 in New York Though Banks Say Rally Can Extend

Oil retreated from an earlier rally with investment banks and traders predicting the market can go significantly higher in the months to come.

Futures in New York pared much of an earlier increase to $63 a barrel as the dollar climbed and equities slipped. Bank of America said prices could reach $70 at some point this year, while Socar Trading SA sees global benchmark Brent hitting $80 a barrel before the end of the year as the glut of inventories built up during the Covid-19 pandemic is drained by the summer.

The loss of oil output after the big freeze in the U.S. should help the market firm as much of the world emerges from lockdowns, according to Trafigura Group. Inventory data due later Tuesday from the American Petroleum Institute and more from the Energy Department on Wednesday will shed more light on how the Texas freeze disrupted U.S. oil supply last week.

Oil has surged this year after Saudi Arabia pledged to unilaterally cut 1 million barrels a day in February and March, with Goldman Sachs Group Inc. predicting the rally will accelerate as demand outpaces global supply. Russia and Riyadh, however, will next week once again head into an OPEC+ meeting with differing opinions about adding more crude to the market.

“The freeze in the U.S. has proved supportive as production was cut,” said Hans van Cleef, senior energy economist at ABN Amro. “We still expect that Russia will push for a significant rise in production,” which could soon weigh on prices, he said.


  • West Texas Intermediate for April fell 27 cents to $61.43 a barrel at 9:20 a.m. New York time
  • Brent for April settlement fell 8 cents to $65.16

Brent’s prompt timespread firmed in a bullish backwardation structure to the widest in more than a year. The gap rose above $1 a barrel on Tuesday before easing to 87 cents. That compares with 25 cents at the start of the month.

JPMorgan Chase & Co. and oil trader Vitol Group shot down talk of a new oil supercycle, though they said a lack of supply response will keep prices for crude prices firm in the short term.

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