Ghana’s 5G deployment brouhaha

The recent announcement by the Ministry of Communications to deploy 5G technology in Ghana to further bridge the digital divide has been met with furore by a section of the population. The government’s plan to establish a shared 4G/5G network infrastructure to help mitigate the known challenges of deploying traditional 5G models is sound; initial deployment cost for 5G is not child’s play. The idea of rolling out a neutrally shared infrastructure to enable widespread 5G access is to promote competition and advance digital inclusion, the approach however has some fundamental flaws, which we will delve into in the course of this treatise, leaving the heavy legal and other policy matters for later so we can focus on how this technology could be implemented for the common good.

The concept of infrastructure sharing in telecommunications has existed for many years, and its impact on pricing and competition has been well documented. The sharing of passive and active infrastructure generally allows operators to reduce capital (CAPEX) and operational (OPEX) expenditures, these savings are then passed on to their subscribers in the form of competitive pricing and better quality of service. Such collaborations have also supported sustainable and environmentally responsible practices in the telecommunications industry, eliminating the need to duplicate infrastructure, most of which lacks optimum use at exorbitant operational costs. Just think about this for a moment; if every mobile network operator were to deploy their own (and exclusive) masts for service delivery, you realise how chaotic it will be with 3 times the amount of masts dotted around the country, right? That’s just one benefit of infrastructure sharing.

That said however, the success of this 5G ‘experiment” will depend on the government’s appetite for the common good over optics, these are just 3 of my thoughts;

1. Transparency & Fairness : This quote by Kirsten Gillibrand had me smiling in the wake of the 5G brouhaha, “I find that when you open the door toward openness and transparency, a lot of people will follow you through”. The NCA had previously announced with pomp and pageantry through a presser on July 18th, 2023 that they were “introducing technology neutrality”, those were just fancy words to describe the Authority’s plan to allocate Ghana’s national resource (5G authorisation) for free with no sureties or conditions to AirtelTigo and Telecel so they can compete favourably with MTN as part of remedies to the latter’s dominance (reference Significant market player/power – Section 6 (3) of Act 775)). The NCA, when it changed course on that error in judgement should have engaged stakeholders properly and sought a lasting solution to the dominance matter, rather than seek to use it as a lynchpin to punish MTN by leaving them out of the rollout of a shared national infrastructure. MTN is not to blame, but the NCA’s own lack of gravitas in dealing with the dominance issue. There should be no infrastructure sharing arrangement in Ghana that excludes any service provider. Telecom innovation thrives where there is healthy competition and a level playing field.

2. Stakeholder involvement & SPV – I am forced to believe that due to our current financial position, infrastructure sharing will become a policy in most of the Communication Ministry’s strategies going forward; the only way to deepen this strategy regarding 5G is to engage in addition to the Telecom Chamber, the other industry stakeholders like the WASPAG, ICT Chamber, GISPA and others. Such a collaboration would benefit the Ministry in engaging a more acceptable joint venture that not only respects the laws of the land, but also presents a more profitable, more inclusive and more sustainable approach to the infrastructure sharing proposal that is currently being gutted for what it’s worth. In a proper arrangement, Government would be using the value of the 5G authorisation and allied approvals as its stake in the project, allowing all Telcos, ISP and allied businesses/investors to provide funding – which guarantees them access to the platform. In an openly transparent arrangement managed by a special purpose vehicle specifically set up for this purpose, all deliberations and decisions would be above board. Honestly, the name for the organization ‘Next Gen Infraco’ strikes a negative cord because of the history of “Smart Infraco” and how it took over operations of the national data center from the National IT Agency (NITA) and beyond. 

3. Competition & Supplier Diversity – Although there are many unintended benefits with their own positive ripple effects, the major promises for the 5G platform are impact and profitability. In fact, the business case for this deployment must speak to the numbers. Closely linked to the above is the need for this enterprise to make room from the onset to onboard local and/or community internet service providers who will focus on providing last mile connectivity (where necessary), create jobs and also benefit from the telecom wealth. Such a local content framework must provide a right of way to smaller ISPs to play in the ‘downstream’ of internet service provision, A diverse supply chain is less vulnerable to disruptions, meaning that members of GISPA will be resourced to provide 5G services based on this deployment to generate the needed competition for the “big boys” for reasons of market resilience, continuous innovation and healthy competition. This will undoubtedly propel our achievement of the digital inclusion targets faster, to help with growth through equal access to high-speed data.

In a nutshell, the 5G company as currently structured will need a comprehensive review, one that takes into account the fact that telecommunications is a vital national security resource that can be used to spur growth and development. This makes it incumbent for an inclusive platform rather than this exclusive one which lends itself to external control with “single-sourced” handset deals sneaked into its operation.

These are my recommendations; 

1. Set up a quasi-government organisation akin to a ‘special purpose acquisition company’, with GIFEC controlling government’s stake (percentage) which would be based on the value of the 5G licence and other goodwill against the value of the total investments needed.
2. Give proper meaning to infrastructure sharing by allowing the 3 existing Telcos to partner the project through funding for a percentage stake as well as give priority to other Ghanaian firms and individuals to partner by providing funding in an open and transparent process.
3. Raise capital through an IPO for the remainder of the funds based on the project cost and then proceed to select the best 5G company based on track record and the understanding of the local terrain for the implementation of the platform. It will be a plus at this point if the company that wins the bid to implement the infrastructure decides to invest; there are various models for this. 
4. The new entity will be run as a private company with a board representative of its stakeholders, with management hired in an open and transparent manner based on skill and experience, not political appointments.
5. Government, represented by GIFEC will gradually float its shares over time to recover its costs/value after the company starts operations in order to pull out completely from the entity and cede its Board membership.