Two out of the three companies that expressed interest in bidding for the 3.5GHz spectrum licence for 5G service delivery have emerged winners. MTN Nigeria and new entrant, Mafab Communication won the bid for the available two lots at $273 million each after a day-long auction ran into Monday night.
The keen interest of the three bidders, which included Airtel, pushed the cost of the spectrum to $273 million from the reserve price of $197.4 million fixed by the Nigerian Communications Commission (NCC). Airtel dropped interest at $270 million to produce the two winners at the end of the eleventh round of bidding.
The winners are expected to pay the bid price on February 23, 2022 at the prevailing official naira value. With this, the Federal Government will be pocketing a total of $546 million as proceeds from the spectrum sale.
The Ascending Clock System of Auction is adopted by the NCC, where the auction manager increases the bidding price at every bidding round, allowing the law of demand and supply.
The first round of the auction started at a price of $199, 347,256, second round closed at $201,367,740 million, the third at $204,388,256, the fourth at $209,497,962.50, the fifth at $215,782,901.38, the sixth at $224,414,217.43, seven round at $231, 146,643.96, eight round, $240.392,509.71, round nine at $251,210,176.65, round ten at $263,017,050.77 million, round eleven closed at $275,904,886.25 million.
The auction started with a brief ceremony where the Minister of Communication and Digital Communication, Professor Isa Ibrahim Pantami, Chairman of the Nigerian Communications Commission ( NCC) board of directors, Professor Adeolu Akande, and Executive Vice Chairman of the NCC, Professor Umar Danbatta addressed the participants and observers on the imperative of the spectrum auction
In his address, Pantami traced the journey from 2019 when 5G technology was tested in Lagos, Abuja, and some other cities in Nigeria and found to be suitable and desirable in Nigeria. He also reminded the audience of a followed up study that showed 5G had no health hazards
He expressed optimism that by 2022 Nigeria will have the largest 5G coverage in Africa. He is also of the opinion that 5G could solve some of the security challenges in the country since the technology provides real-time services and platforms. Pantami also noted that 5G will go a long way in promoting the economic development of Nigeria, because digital technology is a key enabler of other sectors, especially the financial sector.
The Chairman of the NCC Board of Directors, Professor Adeolu Akande said the purpose of the 3.5 GHz Spectrum auction was to support the deployment of 5G technology in Nigeria, for the benefit of Nigerians. According to him, The impactful contributions of 5G to the economy would help industries such as manufacturing, utilities, professional and financial services. “In fact, several other fringe sectors will benefit immensely from the new technology. The importance of 5G technology to the economy of Nations cannot be overemphasized. It is therefore with a sense of fulfillment that we acknowledge the giant leap forward that today's auction represents. It is indeed a memorable milestone that Nigeria is set to auction Spectrum in the 3.5GHz for the deployment of 5G at this material time.”
Also speaking, Executive Vice Chairman of the NCC, Professor Umar Danbatta, said the 5G spectrum auction was based on the powers bestowed on the Commission by Section 121 of the Nigerian Communications Act 2003 as well as the Licensing Regulations 2019.
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