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MTN to Bid For Second 5G Spectrum; Other Telcos Protest

MTN to bid for a second 5g spectrum on December 16, 2022

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MTN Nigeria - Investors King

Nigerian mobile telecommunications company, MTN has showcased a potential interest to bid for a second 5G spectrum in the forthcoming auction which is scheduled for December 19, 2022.

The potential bidding however has been opposed by other telecommunication companies which claimed the move is against the spirit of competition. 

Investors King could recall that MTN and Mafab Communications won the first 3.5GHz spectrum license for a 5G network which was auctioned in December 2021 by the Nigerian Communication Commission (NCC).

The highly competitive auction which took place at the Transcorp Hilton Hotel in Abuja also witnessed the participation of Airtel

Subsequently, in September 2022, MTN finally launched the 5G network to boost internet speed in Lagos, Abuja, Port Harcourt, Ibadan, Kano, Owerri, and Maiduguri.

However, to access the 5G network, users will need to have compatible devices which is a bit expensive for average Nigerians.

To this end, MTN thereafter partnered with a phone financing company, Intelligra to bridge the cost of 5G-enabled smartphones. 

According to MTN Chief Marketing Officer, Adia Sowho, the partnership with Intelligra is aimed to drive 5G adoption in Nigeria. 

Meanwhile, barely two months after MTN launched its 5G network, the leading telecommunication company in Nigeria has showcased a potential bid for the second spectrum which is scheduled to hold on Friday. 

At a stakeholders engagement meeting organised in Lagos, MTN’s General Manager, Regulatory Affairs, Ikenna Ikeme, said the company had entered the last auction in 2021 with the expectation that it was an open market and it would be allowed to participate in other auctions should the need arise.

This, however, did not go down well with other telecommunication companies which claimed that should MTN be allowed to participate in the second auction and eventually win, it will make them dormant players which could affect the overall growth of the industry. 

The Executive Vice Chairman of NCC, Umar Garba Danbatta who presided over the engagement session noted that all contending issues will be given due consideration before the auction on Friday. 

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Telecommunications

MTN Nigeria Grapples with Network Disruptions from Overseas Cable Damage

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MTN Nigeria - Investors King

MTN Nigeria is currently contending with network disruptions stemming from damage to an overseas undersea cable, causing widespread inconvenience for its customers.

The telecommunication giant confirmed the issue in a statement, acknowledging the connectivity disruptions experienced by its subscribers.

Reports indicate that the glitch has affected both voice and data services, resulting in communication disruptions for millions of subscribers across the country.

Subscribers have expressed frustration on social media platforms over the prolonged network outage, with complaints ranging from failed call attempts to concerns about the failure to receive bank alerts.

MTN Nigeria assured its customers that it is actively working to resolve the issue and restore services as quickly as possible.

The telecom operator emphasized the critical importance of consistent internet and communication services, pledging to swiftly address the disruptions.

Efforts are underway to reroute traffic through alternative network paths and expedite the repair process for the damaged cables in collaboration with consortium partners.

Despite the challenges, MTN Nigeria remains committed to minimizing service interruptions and maintaining connectivity for its customers.

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Airtel Africa Mulls IPO for Mobile Money Unit, Eyeing $4 Billion Valuation

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Airtel Financial Results - Investors King

Airtel Africa Plc, led by billionaire Sunil Mittal, is contemplating an initial public offering (IPO) for its mobile money unit, Airtel Money, in a move that could potentially value the division at over $4 billion.

Sources familiar with the matter revealed that discussions have been held with potential advisers regarding the IPO, with considerations for a listing as early as this year.

While Airtel Africa has not made a final decision on the listing venue, executives are reportedly exploring options across bourses in the United Arab Emirates, London, and Europe.

However, it is cautioned that the firm might ultimately choose not to proceed with the offering, and details regarding the timing and valuation of the IPO remain preliminary.

Airtel Money stands as the telecom operator’s fastest-growing division, experiencing significant traction in Nigeria, its largest market.

The expansion of its mobile money services in Nigeria aligns with the government’s efforts to promote cashless transactions, driving the division’s growth trajectory.

The potential IPO comes on the heels of previous investments in Airtel Money, with TPG injecting $200 million at a valuation of $2.65 billion in 2021, alongside a $100 million investment from MasterCard Inc.

The wireless carrier had previously hinted at a possible listing for the business within four years.

Africa’s burgeoning fintech landscape, coupled with a young population increasingly adopting digital banking solutions, presents a fertile ground for Airtel Money’s expansion.

As of the first half of 2024, Airtel Money recorded a transaction value of $56 billion across its operations in 14 markets, reflecting its significant market presence and potential for further growth.

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Interswitch Ventures into Telecoms Sector with $1.08 Million MVNO License Acquisition

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Interswitch, the leading Nigerian payments giant, has made a strategic move into the telecommunications sector by acquiring a Tier 5 Mobile Virtual Network Operators (MVNO) license for ₦500 million ($1.08 million) from the Nigeria Communications Commission (NCC) in May 2023.

This bold step marks Interswitch’s foray beyond its traditional payments domain into providing telecommunications services, leveraging its extensive infrastructure and customer base.

The company’s financial report revealed plans to explore a capital-efficient virtual telecoms model using the acquired license, blending payments and telecoms services for both business-to-business (B2B) customers and consumers.

With the highest tier MVNO license in Nigeria, Interswitch is empowered to negotiate with established telcos in the country and offer asset-light telecom services, particularly in underserved regions.

Interswitch aims to utilize its telco partner’s infrastructure to introduce value-added services to consumer segments traditionally overlooked by mainstream telcos.

This strategic move aligns with Nigeria’s broader objective of increasing mobile connectivity, particularly in rural areas where access remains limited.

The Nigerian telecommunications sector experienced a slowdown in growth recently due to reduced foreign investment, prompting the NCC to issue 25 MVNO licenses in 2023 to foster competition.

Interswitch’s entry into the telco space could inject fresh competition and innovation, leveraging its vast customer base, including over 50 million Verve debit cardholders.

However, to effectively compete in Nigeria’s dynamic telco market, Interswitch will need to offer compelling telecommunications services and forge strategic partnerships with established telcos.

The company’s success in this endeavor will hinge on its ability to introduce innovative communication solutions and value-added services tailored to meet the diverse needs of Nigerian consumers.

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