Are you looking to obtain an MVNO license in Nigeria? In this article, Scotts Legal brings you all you need to know on how to obtain this license in Nigeria. Featuring in this article includes the cost, and procedures to obtain an MVNO license in Nigeria. In addition, there are different tiers of the MVNO license in Nigeria.
But, before delving into all of these in detail, what exactly is MVNO? The subheading below answers the question.
What Is MVNO?
MVNO stands for Mobile Virtual Network Operator. In other words, it is a wireless communication service provider that acquires mobile network services at wholesale prices from an MNO (Mobile Network Operator). This is done with the aim to offer the same services at discounted prices to customers and end users. Some examples of MVNO’s include but are not limited to Access Wireless and Google Fi.
Up next we will list the requirements you need to obtain an MVNO license in Nigeria.
Requirements To Obtain MVNO License In Nigeria
To be eligible to apply for the MVNO license, one must do the following:
- The company must begin by registering with CAC. The Corporate Affairs Commission (CAC), is the government body responsible for managing and regulating business operations in Nigeria. Besides that, registering with CAC proves the legality of the business entity.
- A wholesale contract or Revenue Sharing Agreement with an MNO must be filed with NCC. MNO stands for Mobile Network Operators. The difference between MVNO and MNO is that MVNO relies on support and infrastructure provided by the MNO to operate. On the other hand, MVNO stands on its own.
- Meet technical requirements for the tier of MVNO services as defined by NCC.
- Prove local content in its ownership and service delivery.
- Prove financial capability to the NCC.
With all of the above, follow the next set of processes to obtain the MVNO license.
How To Obtain The MVNO License
It’s important to note that licensing as an MVNO is in tiers. Also, there are 5 tiers of MVNO services. The next subheadings will focus on each of them.
Services Virtual Operator
MVNOs within this category can offer services to customers without switching or IN (Intelligent Network) infrastructure. They also do not control numbering resources and the host MNO is responsible for providing wholesale capacity to the MVNO for the delivery of its products and services. Finally, MVNOs in this category can operate in either of the following operations – sales, brand ownership, sales, and distribution channeling, or running SMSC for SMS services.
Simple Facilities Virtual Operator
In this tier, MVNO has the capacity to control the Telecoms service value chain. Consequently, it can distinguish itself from its host (the MNO). Therefore, an MVNO can own its IN (Intelligence Network) to offer IN services to customers.
Also, MVNOs in this category can establish their subscriber registers or authentication centers, home location registers, and equipment identity registers.
Lastly, they can have and issue their SIM cards as well as own and operate EIR/HLR/AUC/HSS.
Core Facilities Virtual Operator
In this category, MVNOs can leverage their commercial and technical capacities to launch and run a full-core network with switching and interconnect capabilities. In addition, MVNO hosts provide radio access capacity at wholesale to deliver their products and services to customers. As a result, NCC urges them to target underserved and unserved areas by subsidizing requirements for operation in such areas.
Lastly, they can manage core network elements (switching and interconnection) services that include IP Multimedia subsystems, MSC & GMSC, PGSN/PGW, SGSN/SGW & MME.
Virtual Aggregator/Enabler
In this category, MVNOs are responsible to enable or aggregate MVNO services within their market. Also, they are required to rely on a model that stands in between an MNO and several MVNOs.
Besides that, MVNOs in this capacity can perform extra activities such as installing capacity to serve its aggregation or enabling platform. They also perform the inclusive role of a Tier 3 MVNO where they serve underserved or unserved regions.
Unified Virtual Operator
In this category, an MVNO operates on a unified license. In other words, they choose the services they can offer to customers from Tier 1 to Tier 4. Finally, one of their core operations involves sharing the rural areas that are underserved amongst themselves. They do this via shared rural coverage agreements.
Consequently, the next point of discussion is the licensing application procedures.
MVNO Licensing Application Procedures
A prospective MVNO licensee would be required to complete an introduction form obtained from the NCC. Afterward, the following would be required.
• PBG (Performance Bank Guarantee)
• FBG (Financial Bank Guarantee)
• A summary of capital structure proving funding and operational maintenance capacity
• Upon completion of these application requirements, an administrative award will be given by NCC.
• Having met these application requirements, an applicant would be required to pay a specified license fee depending on the tier or service operations.
Mvno License Cost In Nigeria
Tiers of MVNOs and applicable license fees are based on their businesses. These are the 5 tiers of MVNO license together with their costs.
• Tier 1 – 35 Million Naira
• Tier 2 – 60 Million Naira
• Tier 3 – 130 Million Naira
• Tier 4 – 200 Million Naira
• Tier 5 – 500 Million Naira
How Long Is A PTSP Licence Valid?
The license is valid for ten years. Also., it is renewable not later than twelve months before the expiration of the current license.
In conclusion, the MVNO is a big player in the telecom industry. While the MVNO services depend on a contract with a mobile network provider, the NCC has unveiled this space for the MVNOs to maintain productive competition with the MNOs.
This has further contributed to an all-inclusive telecom industry in Nigeria. Hence, innovators in the Telecom industry may now set up an MVNO with a contracted agreement with existing MNOs in Nigeria.
References
1. Mubarak Popoola, Chioma Azuzu, “The Impact of The MVNOs License On Nigeria’s Telecom Sector” available at, https://businessday.ng/amp/news/legal-business/article/the-impact-of-mvno-licence-on-nigerias-telecommunication-sector/accessed on Feb 10 2023
2. NCC’s Licensing Guidelines For MVNOs, available at, https://www.google.com/url?sa=t&source=web&rct=j&url=https://www.ncc.gov.ng/documents/1020-licensing-framework-for-mobile-virtual-network-operators-mvnos/file&ved=2ahUKEwjvm9ONyor9AhVEhP0HHa9eAy8QFnoECBYQAQ&usg=AOvVaw0CTQsgl5OViRbGcaukDhmPaccessed on Feb 10, 2023
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