MTN Nigeria, Airtel Nigeria and Mofab Communications are battling for the two licenses up for grabs at the 5G 3.5 spectrum auction, which kicks off today by 11 am at Transcorp Hilton Hotel, Abuja.
On Friday, December 10, the Nigerian Communications Commission (NCC) successfully carried out a mock session for the 3.5 gigahertz (GHz) spectrum auction for the deployment of the Fifth Generation (5G) network in the country in preparation for the actual auction.
The conduct of the simulation exercise was in line with the requirements stipulated in the Information Memorandum (IM) for 3.5 GHz spectrum auction. The IM is a document that defines the process for the licensing of the 3.5 GHz spectrum band, earlier published on the Commission’s website at the inception of the auction process.
Using the Ascending Clock Auction System for the mock session, the three qualified bidders participated in the software-based simulated auction exercise.
Today’s 5G auction promises to be another historic moment, after the iconic GSM auction that took place on Januarys 19, 2001, some 20 years ago. The NCC has promised that the 5G spectrum auction would follow the same pattern of transparency, the Commission is known for.
Communication Investments Limited, Econet Wireless Nigeria Limited and MTN Nigeria Communications Limited were successful at the auction which price peaked at $285 million up from the reserved bid price of $100 million. Three slots were contested for. A fourth slot was reserved for the government GSM company Mtel.
Although the Announced Price in the End Round was USD $300,000,000 (300 Million), offered by Communications Investment Limited, the two unsuccessful bidders, MTN and Econet ( Airtel) were not willing to pay more than USD $285,000,000, so the price was pitched at $285 million.
Five companies went into the bid, at the time. United Networks Mobile Ltd and MSI-Celtel Nigeria Ltd which were the other companies that joined the three that were eventually qualified for the bid pulled out at some stage claiming the Nigerian operating environment cannot sustain the amount being offered by some bidders.
Today’s auction is likely to follow the same pattern, as the bidders in the first round are likely to add a little fraction on the reserved price of $197.4 million. All the three companies had earlier paid 10 % of the reserved price to qualify them for the bid.
They are expected to go for a second round of bid on the highest offer by any one of the bidders, at the first bid. In 2001, the auction went into the next day. Not very sure if today’s bid would go the same way. It could be a very short auction. Mofab Communications could be the deciding factor on the amount to be offered and how long the bid goes.
