It was the much anticipated auction which followed some industry agitations, but the apex regulator, the Nigerian Communications Commission (NCC) in its infinite wisdom after further consultation to allay stakeholders’ fears, resolved to host the auction on Wednesday, February 19 through Thursday 20, 2014, at the Transcorp Hilton Abuja.
But at the first day, February 19, the numbers of bidders have scaled down from some 27 companies that applied through initial expression of interest to just two, leaving the field to Globacom, the second national operator and relatively unknown consortium called Bitflux Communications Ltd to slug it out eventually.
Although most industry watchers have described and anticipated the auction to be literally likened to the fight between David and Goliath, little chance was actually given to BitFlux in this auction.
For instance, the auction which was expected to be a tight rope for both bidding companies had garnered international and local attentions as investors continued to watch in earnest how NCC under the leadership of Dr. Eugene Juwah could execute this test and how successful or otherwise too.
Prior to the kick-off of the auction, DigitalSENSE Business News also gathered that several industry watchers had faulted the guidelines which availed the likes of Globacom Ltd led by Otunba Mike Adenuga; a second national carrier to enter the competition despite the avalanche of licenses in its kitty, yearning for exploration.
This school of thought had argued that it could amount to drawing the hands of progress within the telecom sector 10 years backward if Globacom had won the 2.3GHz auction, which is outright monopoly.
Whereas, DigitalSENSE Business News learnt that Bitflux Communications Ltd is a consortium comprising VDT Communications Limited, BitCom Systems Nigeria Limited and Superflux Limited.
VDT led by Mr. Abiodun Omoniyi, for instance, is reputed for its broadband reselling records; BitCom Systems Nigeria Limited is a system integrator, value-added reseller, installation service provider for a wide array of microwave, and broadband radio telecommunications products.
On the hand, DigitalSENSE Business News gathered that Superflux is an indigenous conglomerate that has investments in the biggest securities printing outfit in Africa; providing secure and communication print solutions to a wide range of clients. Superflux key print supplies include bank cheques, dividend warrants, certificates, tickets to name a few.
Approved Bidders in line with IM:
The duo who could be described as last companies standing for this auction where ushered into their respective rooms at the Transcorp Hilton already equipped with the intranet application for the auction without any means of communicating with the outside world.
In addition, according to the Auction Manager and Head, Spectrum Management at NCC, Engr. Austine Nwaulune, who had earlier read out the guidelines for the bidders and modalities at which a winner will emerge, said that there are also independent observers in each of the rooms where the bidders are.
DigitalSENSE Business News recalls that NCC had earlier announced the two approved bidders of 2.3 GHz frequency spectrum auction, saying it’s in line with the terms of the Information Memorandum (IM) published on the subject matter by the Commission.
Bitflux beats Globacom:
However, the second round saw Bitflux offering the sum of $23,251,000, while Globacom offered $23,050,001; thus Bitflux was pronounced the winner having been the highest bidder herein, therefore beating Globacom to the bid to the astonishment of most stakeholders.
Bitflux winning bid of $23,251,000m emerged at exactly 11:50am on February 19 at the close of 00:06 hours, 49 seconds, against Globacom’s $23,050,001.
The Globacom team was led by Mr. Mohammed Jameel, the Group Chief Operating Officer, Ibrahim Fadipe, Head, Business Development, Divisional and Director, Head Regulatory Affairs, whereas the Bitflux team consisted of Biodun Omoniyi, Tokunbo Talabi, Tunji Gaafaar and Julius Olatishe.
Despite the fact that the auction literally turned against Globacom, the proverbial ‘Goliath’ in an open and transparent process monitored by DigitalSENSE Business News alongside other industry stakeholders in an open hall at Transcorp Hilton; with BitFlux beating the second national operator, Globacom Limited to emerge winner in the 2.3 Gega Hertz (GHz) auction.
Juwah congratulates bidders:
Announcing the outcome of the auction formally, the Executive Vice Chairman, NCC, Dr. Eugene Juwah congratulated the two bidders; Glo and Bitflux, stressing that they have shown sportsmanship throughout the auction process including the simulated pre-auction and actual exercise, which began with submission of expression of interest some months ago.
He explained that the result which came on the second round of the auction followed the initial 15 minutes of first round, where the bidders were expected to add financial value to the bidding price of $23m, but both bidders where silent; an indication that they may not want to change the price by adding to the bidding price or invariably that the bidding price was high enough for the license.
Pay in 44 days or forget 2.3GHz, UAL licenses:
Excited Juwah also congratulated the spectrum management committee of NCC, describing the exercise as a major history of the telecommunication revolution as a turning point in the quest to enthrone a broadband revolution, which is a key focus for NCC at this time. He was confident the winner, Bitflux will live up to expectation.
“We have adopted the virtues of the open access model; open, fair, transparent and non-discriminatory process. This will now be the shape of things to come when we come to the licensing of the InfraCos,” Juwah said.
The EVC also said that Bitflux has 14 working days to pay for the 2.3GHz licence starting from February 19, 2014, advising that failure to pay within the 14 days will mean that Globacom would be invited to pay for the license. In addition, Bitflux is expected to acquire another license – the Unified Access License (UAL) for N155m within 30 days of payment of 23,251,000 USD in order to maximize the auction they won. Until then, NCC will not issue the 2.3GHz alongside the UAL.
BitFlux win, a divine providence says Omoniyi:
Speaking after the auction, Omoniyi attributed the recent win of 2.3GHz spectrum to divine providence and gave kudos to NCC and stakeholders for their encouragements.
Bitflux, he said, is grateful to NCC for its integrity, transparency and observation of fair rules in the bidding process and for promoting a healthy communication industry, stressing that BitFlux sees Globacom as a big brother in the industry and acknowledges its support for the growth of younger players in the industry.
Stakeholders’ applause for NCC:
ICT stakeholders at the auction commended NCC for the successful round of auction and transparency, which reaffirmed the experience of 2001 during the GSM auction that went for $26.45m, the first by the Commission, which actually brought NCC to limelight as truly a trustworthy and transparent Nigerian institution and regulator.
For the President, Association of Telecom Companies of Nigeria (ATCON) Mr. Lanre Ajayi, NCC management and staff deserve commendation of all Nigerians for proving themselves worthy of Nigerian ambassadors and urged other Federal Government institutions and organizations to emulate NCC, which he said, has gone beyond building individuals to a system-based organisatioon.
Former president of ATCON and Group Chief Executive Officer, Teledom International Group, Dr. Emmanuel Ekuwem reiterated Mr. Ajayi, saying that more Nigerian Ministries, Departments and Agencies (MDAs) should leverage on this kind of transparency to advance the international rating of Nigeria.
Speaking to DigitalSENSE Business News at the auction venue, Messrs Biodun Omoniyi and Tokunbo Talabi who stood in for the Bitflux consortium could not hide their excitement, giving glory to God, they commended NCC for a transparent exercise and Glo for being magnanimous in accepting the outcome of the exercise.
What the analysts say:
Industry analysts posited that the major factor against Globacom’s failure to clinch the license was that they have a one-man empire, which entails that whatever may be the changes in the bidding to be proposed by Glo’s team will mean contacting its chairman, Dr. Mike Adenuga to authorize such a review upward, unfortunately for the team, based on NCC’s guideline for the auction, each team had no electronic devices or gadgets to reach out externally; A management model that made Glo to pay very direly during the 2001 GSM auction with CTL having a little delay payment deadline.
On the other hand, industry analysts said the team Bitflux was made up mainly of the chief executives of the consortium members, which made it possible and easier for them to put heads together and take a quick decision.
Although it was very well agreed among industry analysts that if Glo had won the 2.3GHz auction, the sector and Nigeria ICT development may have been drawn backwards 10 years behind, due to the suspected monopoly the win should have caused.
Wrapping up:
The ball is now on Bitflux to meet up with the expectations and stipulations of NCC to ensure the licenses as required will be issued to the consortium before the expiration of the 44 days of ‘fasting and praying’ for Bitflux to take charge, which will also create more jobs for Nigerians.
Till then, Nigerians are waiting to see the difference beyond the existing licensees of 2.3GHz, namely Mobitel, SpectraNet and DoPC and now the new entrant, Bitflux.
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