Telecoms Operators Demand Review of Framework for VAS Licences

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Emma Okonji

Following last week’s disagreement between the Nigerian Communications Commission (NCC), and the Association of Licensed Telecoms Operators of Nigeria (ALTON), over the released framework for the regulation of Value Added Service (VAS) operators in the country, ALTON has insisted that the best approach to address the issue, was for NCC to review the framework and make the necessary amendments.

Chairman of ALTON, Gbenga Adebayo, told THISDAY that the review was very essential and ALTON must be involved in the exercise.

The NCC had in the past, received several complaints from telecoms subscribers and operators about the services of VAS operators. Their complaints stemmed from fraudulent broadcast and unsolicited text messages otherwise known as short message service (SMS) that flood customers’ phones, a situation that compelled NCC to develop and released a set of regulatory guidelines to help address the issue.

Despite the disagreement between ALTON and the NCC over the guidelines, which ALTON said were inimical to the growth of the telecoms sector, Adebayo said the association would be willing to work with NCC to resolve the issue.
He urged the NCC to review the set guidelines, and make quick amendments in the interest of the telecoms industry.
“That given that many of those implicated in the fraudulent practices highlighted by the NCC are entities to which the Commission itself has issued VAS licenses, NCC should review its framework for issuing VAS licenses. NCC can consider engaging the Wireless Application Service Providers’ Association of Nigeria (WASPAN), which is the industry body for VAS licensees in Nigeria, to provide ceriticates of fitness to persons applying for VAS licenses,” Adebayo said.

He said the NCC should continue to work with the industry to ensure uncompromising enforcement of agreed consumer protection measures such as the “Do Not Disturb” lists, timing and volume restrictions on unsolicited SMS.
According to him, the Commission should either re-constitute the Short Code Working Group or enlarge it to include other stakeholders, including consumers if necessary. The Working Group should then be challenged to finalise the Industry Code of Conduct, not later than one month. This should be a comprehensive document, which entrenches the ideal of self-regulation, as is the case in other jurisdictions.

He listed some of the implications for the regulation of VAS to include threat to new investments; market upheaval; negative effects on job creation; and national security concerns, among others,

In the area of threat to new investments, Adebayo said VAS is used for customer engagement and not primarily for revenue. In the face of falling voice revenues, serious investments are being made to roll out 3G/4G networks primarily to drive the provision of data and digital services to retain customers and help achieve government’s economic growth and inclusion objectives. If we cannot guarantee the viability of present and future investments by providing services, which keep customers on our networks, why should we continue investing in network expansion and broadband services, he queried.

In the area of market upheaval, he said the guidelines seek to change market structure without any study on market competitiveness and without ant prior impact analysis, adding that no known Nigerian company can qualify to provide the services of VAS Hosting Service Provider (VHSP), which the commission proposes to create. The cumulative effect of this and other negative aspects of the VHSP proposal is that it would wipe off the existing VAS providers – most of which are hard-working Nigerian youth providing employment to thousands of Nigerians.

For national security concerns, he said the proposed VHSP would have full information on customers, their spending patterns, their lifestyles, meaning that too much power will be concentrated in a single entity, thereby undermining the objective of preserving competition that the guideline seeks to achieve.

Adebayo therefore called on NCC to discontinue further consideration of the proposals to regulate VAS operations through the released set of guidelines, in the interest of industry stability and sustainability.