NCA auctions 2 telecom licences for GH¢2 million

Business News of Saturday, 24 January 2015

Source: B&FT


The National Communication Authority (NCA) has served notice of two telecom licenses, which are now up for auctioning at a combined cost of GH?2.2million.

The licences, International Wholesale Carrier Service licence and Mobile Virtual Network Operations (MVNO) licence, are intended to boost consumer choices and also deepen competition in the telecom sector.

According to the NCA, the fee for the International Wholesale Carrier licence is going for GH?1million for a period of five years while the fee for the MVNO licence has been set at GH?1.2million, also for five years.

The NCA, which opened bids for the two licenses earlier this week, said the two licences are intended to stem revenue losses in the telecom sector, and also deepen consumer choices and competition as well as to provide investment opportunities for indigenous businesses in the telecom market.

The telecom’s industry regulator said provision of the international Wholesale Carrier Service licence will allow Ghanaian firms interested in acquiring the licence to assist with fighting telecom sector fraud by terminating incoming and outgoing international calls.

The decision to issue the International Wholesale Carrier Service licences is for instance seen as the regulator’s attempt at controlling SIMbox fraud, estimated to cost the nation more than GH?6million every month in government tax revenues.

Simboxing — an activity in which fraudsters terminate inbound international call traffic without routing the calls through registered international gateways and make the calls appear as local calls — has offered a huge challenge to government to maximise revenue from the telecom sector.

This is because SIMboxing is unofficial and unregistered and the perpetrators do not pay relevant fees and taxes. They also divert revenue from the telcos to their private accounts, and those of their collaborators both inside and outside the country.

In 2009, the government contracted Haitian firm Global Voice Group to implement measures and terminate inbound international calls as a way of tackling the SIMbox fraud menace.

According to the NCA, over the past six years about US$200million which otherwise would have been lost has accrued to the state following implementation of the international termination rate regime.

This is in spite of the fact that SIMbox fraud is still growing and is seen as a profitable venture, since international wholesale traffic carrier trade is still regulated in the country.

The Authority said it will issue the licence only to Ghanaian-registered businesses with at least 70 percent interest to enable local entities participate in international telecommunications trade, which is likely to boost the national income accrued from international traffic.

On the other hand, the NCA has explained that the MVNO licence will be issued to companies interested in providing access services to its customer through an agreement with any mobile network operator.

Thus, the MVNOs will be licenced as distinct service providers with their own licencing and regulatory framework without owning a spectrum for access services.

The NCA further explained: “The rationale for the introduction of MVNO licences is to stimulate usage of telecommunications services aligned to lifestyle propositions which are currently inadequate on the Ghanaian market. Consequently, MVNOs are intended to support the growth of Value Added Services and contribute to growth in revenues for the telecommunications sector.