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NCC to commence de-risk of telecom industry

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By Mercy Kelani

The commission is to ensure a competitive market for communications services.

At the maiden edition of the Telecommunication industry risk management conference on December 12, 2022, Executive Vice Chairman of The Nigerian Communications Commission (NCC), Umar Garba Danbatta, affirmed the commencement of plans to de-risk the telecommunication industry stating that minimization of regulatory risks is necessary for ensuring that there are no Disruption of services and that consumers get the best services that are available globally. He added that the information and communication technologies sector is loaded with different business and Technology risks.

These risks also include regulatory burden, Cyber Security and online fraud, access to foreign exchange and many more. The NCC has been ensuring that the telecoms industry is not greatly affected by these risks. A vital goal of the commission, as stated by the executive, is to enforce a competitive market for the communications services that will aid an impartial inclusion of all players, promotion of local content and innovative services to enhance facilitation of new investment, consumer satisfaction and job creation.

The conference focus on making the industry tackle challenges.

Danbatta, represented by Director of Policy, Competition and Economic Analysis Department, Yetunde Akinloye, added that the aforementioned programs and initiatives would be affected if appropriate steps for proper assessment of the challenges that are confronting the industry and proposition of solutions that will ensure sustenance of the Digital Economy ecosystem are not done. Although he asserted that there are ongoing plans to examine the many issues facing the country in implementing the National Digital Economy Policy and Strategy 2020-2030 to build a sustainable ICT sector in the country.

Telecommunication industry risk management conference focused on tabling of the increasing uncertainties in the global economic as well as the regulatory and operational risks in the aspects of new partnerships, increased Data Security regulations and transformation of business models, shifting market structures, regulatory and policy challenges, fast-changing mix of mounting CAPEX burdens and emergence of new disruption scenarios and many more; the conference aims at positioning the industry to tackle these issues which will be beneficial to the telecoms industry and to individual operations.

Effective risk management would enhance effective decision-making.

In a paper titled “X-raying telecommunication risk radar: the operators’ perspective”, written by Eniola Olugboyega, it was stated that taking a risk can either positively or negatively impact a business and that common losses from improper management of risk in the sector entail fines and litigation, loss of business opportunities, lack of customer satisfaction, product failure and many more. The author states that effective risk management would enhance effective decision-making, prevention of financial and reputational loss and solutions to potential threats.

In addition, the paper states that Telecommunication risks from the perspective of the operator include insecurity, foreign exchange risk, human resource risk, regulatory risk, data breach risk, rising CAPEX risk and inability to embrace new business models. It added that telecommunication companies that buy technology from abroad will definitely have to pay for transactions in foreign currency, hindering techniques that can assist in the mitigation of the FX risk which include forward market hedge and money market hedge.

Effective management of risks will help the industry achieve its goal.

Furthermore, although telecoms networks have been able to withstand higher usage during the pandemic, telecoms is still under pressure to foster improvement of network performance and coverage. Also, Head of Corporate Planning Strategy and Risk Management, Kelechi Nwankwo, stated that the aims of the industry will be achieved when there is effective management and identification of risks that can affect the industry. The multifaceted nature of these risks calls for thorough elimination of every risk factor through a cost-based analysis before adoption.


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