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Poorer Telecoms Services Loom Over Forex Access

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  • Poorer Telecoms Services Loom Over Non-access to Forex

Difficulties in accessing foreign exchange to import the equipment needed to expand infrastructure may worsen data and voice telecommunications service delivery for the rest of this year, our correspondent learnt on Friday.

According to the latest monthly industry data from the Nigerian Communications Commission, there are currently over 153.9 million active voice subscribers in the country and over 93 million data subscribers.

Some of the operators told said that they were facing a major setback in implementing their infrastructure expansion plan this year.

The operators stated that except the Federal Government put telecoms on the list of preferred sectors to have seamless access to foreign exchange, “subscribers will have difficulties accessing voice and data services.”

Speaking on behalf of the operators, the President, Association of Telecommunications Companies of Nigeria, Mr. Olusola Teniola, said that the government’s policy on forex adversely affected the firms in expanding their networks in 2016.

He said not acceding to the request in 2017 meant that the industry would continue to experience a setback.

Teniola said, “In terms of how we performed last year in the area of telecoms infrastructure rollout, the impact of the devaluation of naira has been felt by most telecoms operators.

“We should realise that 99 per cent of telecoms equipment are imported from the United States and Europe, and you need forex to do this. Not having access to forex, therefore, means a debacle to infrastructure expansion.”

He noted that there were no legal ways of working around the foreign exchange issue.

“Until the government allows telecommunications equipment to be on the preferred list of items that can access cheaper dollars, it is hard to see where further growth will come from in 2017,” the ATCON president said.

Teniola argued that without expansion of networks or increase in capacity upgrades, the networks would not be able to sustain the quality of service or even improve on it, and revenue would stagnate or decline.

“Again, the government needs to show strong leadership on this critical issue,” he added.

The ATCON president noted that despite being a $68bn sector, there appeared to be a lull in telecoms investments and general infrastructure expansion among operators last year.

He, however, said the reason for the lull was simple. “The uncertainty in the naira to US dollar exchange rate has led to anxiety within the investment community and this has also meant that foreign direct investments needed to fund network expansion and capacity upgrades under our members’ capital expenditure programmes have had to be put on hold.

“We need the government to see that an enabling environment with clarity in policy formulation and execution that leads to transparency will encourage investors, both domestic and foreign, to bring funds to drive this expansion.

“Government needs to remove the fear, uncertainty and doubt that are prevailing in the economy in 2017, or there will be further contraction in the economy irrespective of crude oil prices on the global market.”

Teniola said that the over 153.9 million subscribers in the country might witness debilitating quality of service this year due to the inability of the operators to import the necessary equipment as a result of the forex issue to roll out more infrastructural facilities across the country.

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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Startups

Madica Empowers African Startups with $200,000 Investments Each

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Madica, a structured investment program dedicated to nurturing pre-seed stage startups in Africa, has announced its inaugural investments in three innovative ventures.

Each of these startups is set to receive up to $200,000 in funding from Madica and will participate in the program’s comprehensive 18-month company-building support initiative.

The investment program provides a personalized curriculum, hands-on mentorship, founder immersion trips, executive coaching, and access to Madica’s extensive global network of investors for follow-on funding.

The primary objective of this support is to drive growth and ensure the long-term success of the startups.

Emmanuel Adegboye, Head of Madica, expressed his excitement regarding the investments, highlighting the abundant talent and innovation present in the African tech ecosystem.

He said Madica is committed to supporting African founders who often face challenges in accessing necessary support due to perceptions of risk among global investors.

Madica employs an open application process, collaborating closely with local ecosystem players such as incubators, accelerators, and angel networks to identify and support promising entrepreneurs.

The selection process remains rigorous, with investments made on a rolling basis throughout the year.

With plans to invest in up to 10 additional startups this year, Madica aims to expand the reach of venture capital and founder mentorship across Africa, addressing the existing imbalances in funding availability.

The announcement of these investments marks a significant milestone for the selected startups, providing them with vital financial support as well as access to invaluable resources and networks to propel their growth and success in the competitive landscape of the African startup ecosystem.

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Meta’s Revenue Woes Shake Tech Industry Confidence

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The tech industry faced a wave of uncertainty as Meta Platforms Inc., formerly known as Facebook, delivered a disappointing earnings report that sent shockwaves through the market and dented investor confidence.

Meta’s forecast of weaker-than-expected sales for the current quarter, coupled with plans for higher capital expenditures, rattled investors who were eagerly anticipating robust results.

Shares of Meta plummeted by as much as 19% in after-hours trading to trigger a cascade effect across the tech sector.

The tech-heavy Nasdaq 100 Index experienced a decline of up to 1%, reflecting broader concerns about the health of the industry.

Analysts and investors alike expressed dismay at Meta’s inability to meet revenue expectations, citing uncertainties surrounding the company’s adoption and monetization of artificial intelligence (AI) technologies.

Jack Ablin, Chief Investment Officer at Cresset Wealth Advisors, highlighted the disappointment on the revenue front, overshadowing any optimism about AI adoption.

Questions lingered regarding the efficacy of AI investments and their potential benefits to users, leading to increased skepticism among stakeholders.

The repercussions of Meta’s earnings miss extended beyond its own stock, impacting other tech giants slated to report earnings in the coming days.

Alphabet Inc., Amazon.com Inc., and social media companies like Snap Inc. and Pinterest Inc. all witnessed notable declines, signaling a broader sentiment shift within the industry.

The fallout from Meta’s revenue woes reverberated across the tech landscape, affecting chipmakers, server manufacturers, and software firms. Nvidia Corp., Micron Technology Inc., and International Business Machines Corp. were among the companies affected, as investor concerns over AI investment and revenue growth cast a shadow over the sector’s outlook.

As the tech industry grapples with Meta’s disappointing results, stakeholders are left to ponder the implications for future investments and strategic decisions.

The episode serves as a stark reminder of the inherent volatility and uncertainty within the tech sector, underscoring the importance of diligent risk management and strategic foresight in navigating turbulent markets.

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TikTok Vows Legal Battle Amid Threat of US Ban

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As the specter of a US ban looms large over TikTok, the popular social media platform has declared its intention to wage a legal battle against potential legislation that could force its Chinese-owned parent company, ByteDance Ltd., to divest its ownership stake in the app.

In what amounts to a fight for its very existence in one of its most crucial markets, TikTok is gearing up for a high-stakes showdown in the courts.

The alarm bells were sounded within TikTok’s ranks as Michael Beckerman, the company’s head of public policy for the Americas, issued a rallying cry to its US staff.

In a memo obtained by Bloomberg News, Beckerman characterized the proposed legislation as an “unprecedented deal” brokered between Republican Speaker and President Biden, signaling TikTok’s readiness to challenge it legally once signed into law.

“This is an unprecedented deal worked out between the Republican Speaker and President Biden,” Beckerman stated in the memo. “At the stage that the bill is signed, we will move to the courts for a legal challenge.”

The urgency of TikTok’s response stems from recent developments in the US Congress, where lawmakers have fast-tracked legislation mandating ByteDance’s divestment from TikTok.

The bill, intricately linked to a vital aid package for Ukraine and Israel, has garnered significant bipartisan support and is expected to swiftly pass through the Senate before landing on President Biden’s desk.

Beckerman minced no words in his critique of the proposed legislation, labeling it a “clear violation” of TikTok users’ First Amendment rights and warning of “devastating consequences” for the millions of small businesses that rely on the platform for their livelihoods.

TikTok’s defiant stance reflects the gravity of the situation facing the tech giant, which has spent years grappling with concerns from US officials regarding potential national security risks associated with its Chinese ownership.

Despite extensive lobbying efforts led by TikTok CEO Shou Chew to allay these fears, the company now finds itself at a critical juncture, where legal action appears to be its last line of defense.

ByteDance, TikTok’s Beijing-based parent company, has also signaled its intent to challenge any US ban in court, signaling a united front in the face of mounting pressure.

However, navigating the legal landscape will not be without its challenges, as ByteDance must contend with both US legislative measures and potential obstacles posed by the Chinese government, which has reiterated its opposition to a forced sale of TikTok.

As TikTok prepares to embark on what promises to be a protracted legal battle, the outcome remains uncertain.

For the millions of users and businesses that call TikTok home, the stakes have never been higher, as the platform fights to preserve its presence in the fiercely competitive landscape of social media.

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