Severe technology limitations, inadequate financial muscle and low innovations in terms of valueadded service offerings in Nigeria have forced over four million telephone subscribers to dump the networks of telecoms operators in the Code Division Multiple Access, CDMA, segment in the last three years, National Mirror can reveal.
the GSM companies, though they do have universal licences. The GSM operators have their network almost everywhere in the country with required financial muscle to support and build their network. He said, by virtue of their national presence, subscribers on GSM networks were able move freely to anywhere in the country without having to face immediate coverage limitation typical of CDMA networks.
Speaking in the same vein, the President, National Association of Telecom Subscribers, Chief Deolu Ogunbanjo, said the limitation in network coverage could discourage mobile telecoms subscribers to stick to a CDMA line for long, arguing that “GSM offers wider coverage than the CDMA and this could be a point of attraction to customers.”
He specifically noted that players in the CDMA segment have the limitation of technology, inadequate financial muscle and low innovations in terms of offering value-added services to their customer.
Over the years, the merger option has been recommended for the CDMA operators to create a strong network with national coverage that will be able to compete with their GSM counterparts but the idea, first advocated by the former Executive Vice Chairman of NCC, Mr. Ernest Ndukwe, was not considered by the operators until last month, when some CDMA operators announced moves to merge as a single operator.
Meanwhile, Ogunbanjo pointed out that the plan by three of the CDMA operators – Starcomms, Multilinks and MTS, to come together as a single entity, through a merger arrangement, might be the beginning of a turnaround in the CDMA segment, thereby bringing them back to profitability.
The President, Association of Telecoms Companies of Nigeria, Mr. Lanre Ajayi expressed hope that though the CDMA segment of the nation’s telecoms sector industry has been in doldrums for the past few years, the new merger arrangement, if well implemented, might open a new chapter for the operators.
“The development holds a good omen for the CDMA sector in Nigeria and subscribers who dumped their land lines would dust them up and make good use of them once again and I think this may be the beginning of a turnaround for the ailing operators.”
The Consumer Protection Council of Nigerian has however raised eyebrows about the merger move saying it was against the spirit of competition.
