NigComSat-1: A disaster waiting to happen

Abdul Aziz · #1 21-11-2008, 01:11 AM

NigComSat-1: A disaster waiting to happen

　
From Guardian Newspapers
HE recent news about the disappearance of the Nigerian Communications Satellite (NigComSat) in orbit is not coming as a big surprise to many industry watchers which goes on to confirm my initial suspicion that Nigeria's investment in that venture might have been a monumental waste of public funds.
In what the Obasanjo administration saw as Nigeria's panacea to technological advancement as well as an infrastructure which would enhance communications, security, weather monitoring and agriculture, the contract for the project was (hurriedly

) signed in December 2004. This was between the National Space Research Agency and the Great Wall Industry Corporation of China at about N40 billion. Only the Obasanjo administration saw the urgency and necessity of that project at a time when the satellite was becoming less useful for communications purposes from where there is huge income (optic fibre is presently making waves) and launching of satellite has become largely a private sector initiative.
It was against this backdrop that the satellite was launched into orbit with great fanfare in May 2007 during which the nation was assailed with fanciful benefits available to the nation from the launch. Apart from what satellite was traditionally capable of providing, such as bandwith for telecommunications operations, assisting in information gathering including areas of intelligence, the satellite was touted by the promoters as capable of reducing the so-called high cost of making calls in the country.
Based on this statement from Nigcomsat, expectation on the project was expectedly high from all corners of the country as everyone believed that a new dawn had truly come.
In actual fact, it was said that Nigeria would save billions spent on leasing transponders from foreign satellite companies patronized by Nigeria in the absence of a local alternative while several jobs would also be created. Not long ago, the Managing Director of NigcomSat, Engr. Rufai, did say that Nigeria would soon earn about 1billion USD yearly from services of the Satellite which would come from lease of its transponders! What that means in practical terms is that in one year alone, the company would have generated revenue more than the total investment in the project!
From the beginning of this project, I had foreseen trouble based on past experience in this country whereby Government business is generally regarded as nobody's business and the haste accompanying the implementation of this particular project.
I have had cause to wonder if there was any business plan to justify the huge investment and whether the project could not have been executed at a lower cost to the nation.
My fears got confirmed as soon as the project was launched and rather commencing marketing of various products available as touted by Nigcomsat, the company went to town asking Nigerian Communications Commission (NCC) to grant it licence to do last mile which meant that it was abandoning its initial core business of providing satellite services, a somehow lucrative monopolistic segment of the telecommunications industry, to providing direct service to customers.
In trying to hoodwink the nation, NigComSat had issued a statement to the effect that granting it a licence would help it crash tariff as presently offered by the telecommunications companies. For popular effect, it stated that the company would offer one minute of call at N10! Immediately I got this information, my fears heightened because something told me that someone had started to play games with an unsuspecting Nigeria. It was as simple as that.
From this point, questions started flooding my head about the status and reliability of the satellite in the orbit. Could it be that the satellite is malfunctioning or not working at all

Could it be there was no business plan to justify the huge investment other than some smart business men who merely sold the idea to the Government

Could it be that the operators do not know the purpose(s) of launching the satellite thereby not knowing the potential market

Was last mile part of the mandate of Nigcomsat

Does the company understand the difficult environment of running the last mile service where you needed to generate your own power, run a security outfit and pay all kinds of charges including settling the growing band of area boys, which would determine the per minute call cost

How does an informed Nigcomsat intend to offer a minute call at N10 when interconnect rate is not less than N18 between operators

Would it run at a loss

Questions, more questions!
Now that the scale has come off our eyes, most of these nagging questions have been answered to a large extent. It appears now that all this while, Nigcomsat has been economical with the truth. The corporation had been aware of the problems of the satellite and was trying to find an escape route by cleverly sneaking to start the provision of direct telecommunications services as a response to a possibly failing venture.
Government has a duty to support infrastructure development, no one is arguing against that, but only when the private sector is unable to pick up the challenge especially when that government claims that its initiatives are private sector-driven. Government should go ahead to provide the enabling environment required to make investors put down money to run business. We have seen that happen before our eyes in this country. Today, the massive investment of more than N15 billion in telecommunications within seven years was made possible through private sector efforts. If this had happened in the power sector, the story of Nigeria today would have been different.
One hopes that the satellite can still be located and not totally lost in orbit but if it is not found in useful condition at the end of the day, the nation deserves to know what actually went wrong and find out how we got to this embarrassing situation. Someone should be made to pay for this costly failure.
The lost satellite may be a sad development but certainly it has its good implication for this country. How many of this kind of white elephants litter the nation's landscape such as the old satellite balloon project of the old P&T Department

If something is done to stop this kind of embarrassment occurring in the future, then this loss would become less painful.
Ekundayo ,a former senior official with NITEL, lives in Lagos.

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