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Telcos Renew Push for OTT Regulation

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Services Tax
  • Telcos Renew Push for OTT Regulation

Nigeria telecoms operators have renewed the push to get the Nigerian Communications Commission (NCC) to regulate the activities of Over-The-Top (OTT) players.

The carriers, including MTN, Globacom, Airtel, 9mobile and others, acting under the aegis of Association of Licensed Telecoms Companies of Nigeria (ALTON), said the time has come for the regulator to re-examine its position on issuing technology neutral licences because of emerging issues in the industry.

Its Chairman, Gbenga Adebayo, lamented the high mortality rate of telcos. He said the number of operators has dipped by half over the past years because of issues that are not entirely their making.

What is OTT?

Online knowledge bank, Wikipedia, explains that “OTT is where a telecoms service provider delivers one or more services across an IP (internet protocol) network. “The IP networks is predominantly the public internet, although sometimes telco-run cloud services delivered via a corporation’s existing IP-VPN (virtual private network) from another provider, as opposed to the carrier’s own access network. It embraces a variety of telco services including communications (e.g. voice and messaging), content (e.g. TV and music) and cloud-based (e.g. compute and storage) offerings.”

It said stimulated by the availability of high performance fixed and mobile broadband networks as well as the rapid adoption of smartphones and tablets, telco-OTT is viewed by a selection of industry analysts and media commentators as the mechanism that mobile network operators need to employ in order to compete with the vast and growing range of over-the-top (OTT) services provided by non-telco companies.

Telco-OTT is a response to the fact that users will have multiple devices (smartphones, laptops or other connected devices such as TVs, games consoles) which almost inevitably will have various different access providers (especially with the growth of public-access Wi-Fi).

According to Wikipedia, to deliver consistent telco-branded services, at some points at least, they will need to be delivered over third-party access, Wikipedia submitted.

ALTON’s position

Adebayo said the regulator has said continuously that it is neutral about technology. This, in essence, means it licences for services and not for technology.

He said today, the reality is that technology is driving the market. It is no longer services. There is a need for the regulator to begin to look at the issue of regulating technology and not services.

For example, OTT as it is called, the likes of YouTube, Facebook, WhatsApp, BlackBerry Messenger and others, all of these are OTT and not part of the core services for which operators are licensed.

“Those kinds of services have a social implication, economic implication, security implication and if they are not licensed, that means they are not regulated and if they are not regulated, there is no limit or scope to what they can do. And no control over their services and content they can provide.

“We are therefore saying there is a need for the regulator to begin to look away from the neutrality of technology and technology certification and regulation than just licensing for service not only because of the social security implication but also because of the economic implication for the operators.

“Today, more people send WhatsApp messages, they send messages over the social media platforms than they do on the conventional SMS platform.

“Operators have been licensed to provide voice, SMS and data services for which they are licensed and being charged annual operating levy. OTT don’t have such and there is even loss of revenue to the regulator of the country too because they are not paying for rendering those services.

“That is why we are saying that our regulator must begin to look away from technology neutrality but Health of the telecoms industry.

He said studies and report had shown that in a market such as Nigeria’s, bigger operators survive better than smaller operators.

“When I took up this role as the Chairman of ALTON, there were 35 companies in our group. Today we are 16, meaning that we have lost half of our members due to problems not of their own making,” he lamented.

He said this might be forces of competition, this might be forces of market forces, the challenges of investing, it might be access to fund, it might be anti-competitive prices of on the part of some of the big players.

“We just think that studies such as the Study of the Level of Competiton in the Telecoms Industry in Nigeria organised by the NCC should dwell into those areas so that we begin to see the issues leading to the death of telecoms companies.

“The challenge we have now with one of the big operators attests to the fact that the industry may not be as healthy as we are thinking and therefore studies such as this are very important first as health check, to see where we are and to see where and how we can further adjust and tune things for a more competitive industry and for a more robust market and for the greater interest of the consumers,” Adebayo said.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Fintech

From Trading to Credit: Robinhood Launches No-Fee Credit Card with Gold Membership Perks

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Robinhood

Robinhood Markets Inc. has announced the launch of its highly anticipated no-fee credit card and it was accompanied by exclusive perks for Gold membership subscribers.

This bold move is a step in the company’s mission to evolve into a comprehensive financial services provider.

The Robinhood Gold Card boasts an array of enticing features. Chief among them is the absence of annual costs or foreign transaction fees, positioning it as an attractive option for consumers seeking financial flexibility.

Moreover, cardholders stand to benefit from a generous 3% cash back on all categories of purchases, a competitive offer in comparison to industry rivals.

Vlad Tenev, CEO of Robinhood, emphasized the company’s commitment to innovation and industry leadership in an interview.

He expressed the intention to not merely introduce a credit card, but to revolutionize the market with a product that sets new standards for customer satisfaction and financial empowerment.

The announcement has sparked enthusiasm among investors, with Robinhood’s shares witnessing a 6.9% surge in early market trading following the news.

This surge further underscores the market’s confidence in the company’s strategic direction and its potential to disrupt traditional financial services.

Beyond the credit card venture, Robinhood has been steadily diversifying its offerings. With the introduction of retirement products and the expansion of commission-free trading services internationally, the company is positioning itself as a formidable player in the global finance landscape.

As Robinhood continues to innovate and expand its suite of services, its trajectory suggests a promising future as a leading force in democratizing access to financial tools and services.

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Telecommunications

NCC Files Copyright Infringement Charges Against MTN Nigeria and Others

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Karl O Toriola - Investorsking.com

The Nigerian Copyright Commission (NCC) has taken legal action against MTN Nigeria Communications Ltd. and four individuals, including its Chief Executive Officer, Karl Toriola, over alleged copyright infringement.

The charges, filed in the Federal High Court, Abuja Division, revolve around the unauthorized use of musical works belonging to artist Maleke Idowu Moye.

According to the NCC, the defendants are accused of offering for sale, selling, and trading musical works of Maleke without his consent between 2010 and 2017. These works were allegedly used as Caller Ring Back Tunes without proper authorization.

The musical pieces in question include popular tracks such as “911,” “Minimini-wanawana,” and “Stop racism,” among others.

The commission further alleges that the defendants distributed these musical works to subscribers without authorization, infringing upon the rights of the artist.

The charges are based on provisions of the Copyright Act, Cap. C28, Laws of the Federation of Nigeria, 2004.

As the case awaits assignment to a judge and a fixed date for mention, it marks a significant development in the ongoing efforts to uphold copyright protection in Nigeria’s telecommunications sector.

This legal action underscores the NCC’s commitment to safeguarding the intellectual property rights of artists and creators within the country.

MTN Nigeria, a major player in the telecommunications industry, now faces a legal battle that could have broader implications for how intellectual property rights are respected and enforced within Nigeria’s digital landscape.

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Telecommunications

MTN’s MoMo Sees 32.2% Surge in Transaction Volumes

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MTN Nigeria - Investors King

MTN Group’s mobile money platform, MoMo, has experienced a 32.2% surge in transaction volumes.

With 72.5 million active users, MoMo continues to solidify its position as a leading fintech service provider in Africa, tapping into the continent’s burgeoning mobile banking sector.

The company’s success underscores the growing trend of Africa’s young and tech-savvy population embracing mobile technology to address financial needs.

Mobile phones are increasingly becoming a tool for bridging gaps in services, particularly in banking, presenting a lucrative opportunity for wireless carriers like MTN to capitalize on the burgeoning fintech market.

MTN’s achievement comes as it finalizes a deal with Mastercard Inc., valuing its fintech business at an impressive $5.2 billion.

This strategic partnership further enhances MTN’s position in the digital finance space, positioning it for continued growth and innovation.

However, MTN is not alone in its fintech endeavors. Rivals such as Airtel Africa Plc, Safaricom Plc, and Vodacom Group Ltd. are also making strides in digital transformation, with plans to separate and monetize their fintech businesses in the long term.

Airtel Africa, for instance, is reportedly considering an IPO for its mobile money unit, indicating the high stakes and intense competition within the sector.

Despite the remarkable success in its fintech ventures, MTN faced challenges in its core telecommunications business, with service revenue growth slowing to 6.8%.

Inflation and currency devaluation in key markets, particularly Nigeria, impacted profitability, highlighting the complexities of operating in diverse African markets.

As MTN continues to expand its fintech footprint and invest in infrastructure to enhance connectivity across the continent, it remains poised to capitalize on the immense potential of Africa’s digital economy.

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