Convergence means that there can be only one regulator

Ghana, serene economic climate and stable political environment, appears to be winning the trust of the world and giving assurance that it has tucked its history of political upheavals somewhere into Africa's political archive. The quite streets of Accra are assuring enough and a visitor four years ago, coming from Nigeria, would have been amazed by the

progress made in telecommunications. Then, the mobile phones were visible working tools in Ghana when Nigerians were still trying to figure out what to do with a moribund national network consisting of some inefficient private players and the notoriously incompetent public telco Nitel. In all there were less than 450,000 active phone lines and you had to pray to make then work.

Ghana had taken some leaps then; had its GSM operators and regulatory frameworks in place for a competitive telecom marketplace. The story is not too different today. Perhaps, even better. Now, there is a stronger sense of political serenity and friendly economic regime that should attract prospective investors. What Ghana has even more is that strong sense of organisation that pervades the public and private sectors. Take a 45 minutes flight to neigbouring Lagos, you see the chaos and the stifling air that has become part of the boisterous colour of Africa's biggest market of some 130 million people [less conservative figure puts Nigeria's population at 150 million].

 

But in Ghana, the air is different for some 17 million people that make up Black Africa's first politically independent state. There are plans to further open up the economy with more private players particularly in the telecommunications with broadcast sector. What this means is more challenges for the regulator in the very dynamic industry. While technology would always change like daybreak, the onus is on the regulator to rule firmly and in fairness within existing guidelines and sufficiently enough to secure the interest of all players and protect the market against any form of abuses. Upon all these is the reputation of the regulator built, says Ghana's Chief Regulator Major Tandoh who shared some moments with IT Edge in Abuja (Nigeria) and Accra (Ghana).

In terms of regulation within the West African sub-region, how would you score Ghana right now?
I will score Ghana very high in terms of regulation because from when the Act establishing my authority that is National Communication Authority (NCA) was established in the year 1996 to now, we have put some things in place to regulate the communication sector. We have been able to create a workable framework to regulate all aspects of the sector and minimise any form of duplicity. I am by that Act, the regulator and the director general but that is quite not the case here in Nigeria. Here you have Director General for NCC here, Director General for NBC. In Ghana, all the responsibility is on me as the Chief Regulator, Director General.

Are you saying that it is an anomaly to have separate regulators for the broadcast and telecom sectors?
Yes! Today as we were speaking at the forum, there were issues that showed that this sort of regulation was of inconsistent with trends within the industry. There were some protests from the licensees of NBC. They come to the NCC to say that we got this license, which permits us to do data meaning that we don't need licence from you. The reason for the confusion was obvious; all of these services now come under one umbrella because of convergence. We have tried to reflect this convergence in our regulatory approach in Ghana. We try to regulate with the view that there is convergence among the telecommunications, broadcasting and computer industries. If they can come under one umbrella in Nigeria, it will be good for the industry and more importantly the ITU has come out with regulations that reflect these trends. You now have FM radio stations that are moving from present 1.5 to 108 mHz and into another band in 234 mHz. What is going to remain after this migration is anyone's conjectures and soon that frequency for FM is going to be used by telecom operators? There are a lot of exciting issues emerging and all of these point to the fact of convergence.

About four years ago Ghana was seen as the reference point for the entire sub-region in terms of its policy of liberalisation and regulatory regime, would you still say the same thing of Ghana today?
Today we are still the reference point for the same reason we were the reference point years back. Why I am saying so is that look at telecom liberalization. We took the first initiative to privatise our telecommunication sector. Ghana Telecom, the state-owned company was offered to a certain investors and the management scheme was altered to with 30% shareholding to investors to the tune of some $35 million Ghana Telecom was forced to operate as a private company not as a government owned company. Also at that time, there were a lot of issues concerning the licensing of a Second National Operator, it would be safe to say that other African countries took a cue from us. They were coming from Nigeria, Uganda, Gambia and South Africa to know exactly whether we have achieved our aims and objectives of privatising Ghana Telecom. Nigeria is doing well today. I saw it in the papers. In terms of privatisation, you are leading. Nigeria has introduced Second Network Operator that is Globacom. What I am saying is that Ghana continues to be a reference point because we have had in mind to privatise and to open up the telecommunications sector. Other countries in Africa watched us closely and Nigeria is the one that really admired us most. Today, Nigerians are keen to privatise a state owned company like Nitel even in though many people are confused or fearful over privatisation. I give credit to the authorities here including the NCC.

One burning issue in Ghana as is the rest of the continent is what should regulators do with VoIP. Ghana appears to have been caught in the 'VoIP miasma' as well. Ghana Telecom recently clamped down on some operators it accused of using its facilities for VoIP. There is the perception that the NCA does not favour the use of VoIP.
Let me clear the erroneous impression about Voice over IP. VoIP is not illegal. VoIP is allowed because we believe in the dynamics of technology. But we say that its usage must conform to the regulatory regime. Before you operate VoIP you need a licence. Westel is using VoIP and it is allowed. Ghana Telecom for some time was also using VoIP. What is happening is that illegal operators such as the Internet Service Providers (ISP) use this to terminate calls illegally through other networks. They use these lines to terminate calls from abroad using their satellite dishes; pass the calls through their black box, modem and it will appear as a local call. This is happening everywhere. In Nigeria, it is happening. In Europe and other places, you have these companies with their agents all over who work with these local agents to divert calls. Arrests have been made in Ghana and a number of operators are under investigations. Ghana telecom has also evolved a way of blocking illegal voice by not giving them duplex. Duplex means ISPs have control over both out and incoming traffic but now, we are only giving permission for outgoing traffic.

Regional integration is becoming a serious issue even in terms of telecom regulation, how much commitment does Ghana have in this line?
We are towing in this line and active in the sub-regional policy initiative which Engineer Ndukwe [Mr. Ernest Ndukwe is the Executive Vice Chairman of the Nigerian Communications Commission] play very important role in. We all appreciate the need for an association, something equivalent to the EU Council of Ministers where they issue directives on telecommunication to harmonise policies and direct issues that affect all member states. We have taken the first step through the WATRA initiative to have common laws, directives just as applies with the EU. The next step would soon apply in which case, every country's regulations in terms of policy formulation, interconnection agreements; Internet access have to conform to the EU directives. The EU has the best brains in their telecommunication sector able to sit down to write all the regulations, directives and policy that are very, very effective and binding on all members. We have other associations in Europe, there is the ECA, European Communication Administration; we also have the IRP, Independent Regulatory Group, that group is equivalent to WATRA. Europe is large just like West Africa. If we use WATRA as a starting point, we will go a long way to harmonise telecommunications policies within ECOWAS. WATRA is the beginning and I support it fully so we are meeting in Accra in November from 10 to 12 [2005].


In terms of financial investment, how far has regulation impacted on Ghana's telecom sector?
Over $2billion investment has been generated and a lot of this has been through the private sector. But there have been disappointments. Ghana Telecom and WESTEL couldn't perform well and we had to sanction them because they did not satisfy the obligations of their service. Ghana Telecom was to pay $51 million and Westel was to $71 million. But this has been reduced and Westel, for instance is to pay $21 million. We are having problems with them because they feel that the $10 million they paid for license is for everything including GSM spectrum. In Nigeria, you know the state owned corporation, Nitel went into bidding for GSM spectrum and paid $285million. We are not saying that operators in Ghana should also pay that price because Nigeria's economy is bigger. But imagine an operator telling us that they are not going to pay for any spectrum because the $10million they paid in 1997 is part of that and they are trying to quote a section of their licence to defend that. In effect, what they are telling us is that when we move to into 3G licence, it would be taken that because they have paid $10 million, they are not to pay anything. We have made it clear that this kind of behaviour is unacceptable.


A lot of people look at the impact of privatisation on the telecom sector in Nigeria in not just in terms of the increase in the number of lines but offshore monies that have come in. How much offshore money has entered Ghana?
I will say a lot in terms of private investment. I cannot give you the exact figure but a lot have been put into it. If you can consider the fact that with the privatisation and liberalisation of the telecom sector, total number telephones, both fixed and mobile, within the last three years from 2001 to today has risen to over one million lines which is a lot of money and all from the private sector.


African regulatory authorities are gradually moving from licensing services to ensuring compliance with the minimum standard for quality of service delivery, does this challenge also applies to you as Ghana's regulator?
There was a time there was a lot of congestion in the network because of unexpected increase in the number of telephone lines from 400,000 to one million lines. The pressure was on the incumbent Ghana Telecom to supply a lot of E1s. There was certainly a big problem at that time with protest from other players that the situation can be resolved. That has since been done even though there are still problems. Today, the problems in Nigeria is the same with what other countries in the continent are facing particularly where there has been increase in telephone density which was not anticipated. It is a challenge that all operators would eventually come to address as the quality of service ultimately takes priority over other things in a competitive environment.


So the emphasis now is to grow networks, that is increase access?
Yes. Nigeria wants to attain 10 million lines from over eight million within one year. This is possible because of wireless communication, the use of radio wave communication both for wireless local loop, which also applies to technology like CDMA, GSM both 900 and 800 mHz as long as the financial resource is in place. Any base station that is capable of serving say 2000 subscribers; once you are able to install it at a location and commission it that same day, anybody who applies to be among the 2000 subscribers can be connected using the IRS because is not cable. The cable is better because it gives you higher bandwidth especially when you use fibre optics. Look at Nigeria, there is little coverage of fibre optics network across the country; in fact, that is one of the yearnings of all regulators since this offers a more stable service delivery but this requires a lot of investment. It requires time and cost to roll out especially through difficult terrains. With wireless it is easier and faster, if you are able to use a wireless local loop, you attach it to a switch of a telecom operator, that switch can be established at the base stations where you can extend that service network to about 50 to 60 kilometers within the same environment. With improvements in technology, you can use this facility to provide telephone and Internet service. In Ghana the government policy is to connect all secondary schools and training colleges with telephones and Internet connectivity by the end of 2006 and these are methods we have researched into. In fact, we shall be conducting some demonstrations on the use of wireless local loop to provide Internet connectivity for data and fax all over the country. Once this is done, we shall begin works on those areas we have earmarked for coverage. It takes two weeks to install such facilities provided we have the required number of E1s.

What incentives are you putting in place to encourage those that are investing in Ghana to continuously invest?
Taxes imposed on other equipment affects those in telecommunications but in terms of clearing, some of these taxes are completely like zero.

 

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