Sat, 15 Sep 2018 Business & Finance

NCA Sets New 4G Spectrum Price At US$33.75m

By Samuel Dowuona
NCA Sets New 4G Spectrum Price At US$33.75m

National Communications Authority (NCA) has set the price of the three 2x5MHz spectrum slots to be auctioned this year at US$33.75million each.

This is contained in a document from the NCA, titled "Licensing of Frequency in the 800MHz Band (i.e. Digital Dividend) for Mobile Services - Selection and Award Procedure."

The price is half the US$67.5 million MTN paid for the 2x10MHz lots in 2015.

This indicates that the NCA has not reduced the minimum price of lots in 800MHz spectrum band in spite of several criticisms and calls for a reduction to boost usage.

The NCA is however giving potential buyers a technology and service neutrality window, which allows holders to use the spectrum to deploy any technology of their choice, including 5G without paying for another license.

The document indicates that bidders are allowed to bid for a maximum of two of the available spectrum lots, which would come to the same US$67.5million MTN paid.

It said the licensing period is 15 years and prospective bidders are required o indicate ability and readiness to sell off 25 per cent shares in their companies to Ghanaians in two years.

"The applying entity is required to submit a proposal including the following: proof of payment of non-refundable application fee of GHS250,000,

proposal on the intended use of the frequency band, best price offer (BPO) for a 2x5 MHz lot with respect to NCA’s Asking Price (NAP) of US$33,750,000, and

total number of lots being sought not exceeding two.

"The applicant shall establish a minimum 25% Ghanaian ownership and have two years to meet this criteria," it stated.

MTN was given 13 months to sell off 35 per cent of the company after acquiring the 4G license. It has been 32 months and they have not been able to meet that criteria in spite of the recent successful MTN IPO.

Meanwhile, the coverage obligations for the new license are that holders must, in 36 months, cover a minimum of all 6 metropolitan capitals and 20 other municipal and district capitals - cover a minimum of additional 50 municipal and district capitals by the 48th month, and an additional 50 district capital by the 60th month.

NCA indicated that applications are to be submitted into a tender box at NCA on or before 5pm on October 8, 2018 and the auction process is expected to finish by December 23, 2018.