CHAPTER ONE

INTRODUCTION

Background of study

 The invention and development of telecommunication in the world began in the 1830s. The first commercial electrical telegraphy was constructed by Sir Charles Wheatstone and Sir William Forthergill Cooke and they both devise as “improvement to the existing electromagnetic telegraphy” (Robert Laslett, 1999). Samuel Morse on the other side of the Atlantic Ocean independently developed another version of electrical telegraphy that he unsuccessfully demonstrated on 2nd September, 1837. Thereafter, Alfred Vail developed another version of the technology and this was successfully demonstrated on 6th January, 1938 (Marshall 1964). The first transatlantic telegraphy label allowing transatlantic telecommunication for the first time was viewed successfully completed on 27th July, 1866. Alexander Bell invented the conventional telephone in 1876 and the first commercial telephone services were set-up in 1878 and 1879 in both Haven and London (Acitelli 1992, Flecther & Fincahm 1991).

However, Nigeria has not been left out of this race for rapid development of telecommunication, although the journey to success in the milieu had been long and tortuous. The development of telecommunications facilities in Nigeria began in 1886 when a cable connection was established between Lagos and London by the colonial administration (Omagbemi 2004). From the very beginning, it was clear that the introduction of telephone services in the country was not induced by economic or commercial motives. It was not meant to enhance economic growth, but it was originally developed as a tool for colonial subjugation (Jager and Lokman, 1999, Jones, Zenois and Griffiths 2004 and Eynon 2006).

For this reason, by 1893, government offices in Lagos were provided with telephone service, which were later extended to Ilorin and Jebba in the hinterland. A slow but steady process of development in the years that followed led to the gradual formation of the nucleus of national telecommunication networks. However, as the European mercantile activities gained foothold in the country, the first commercial trunk telephone service was established to link Itu and Calabar in 1923.

Between 1946 and 1952, a three channel line carrier system was commissioned between Lagos and Ibadan and was later extended to Oshogbo, Kaduna, Kano, Benin and Enugu. Thus, connecting the colonial office in London with the commercial centers in Nigeria. In those early days, services were primitive and the coordinated pegboard switching system was used. This later progressed to manual switchboards of different sizes, shapes, and capacities until stronger exchanges were installed into the national network at Lagos Island, Ikeja, Ebute Meta, Apapa and Port Harcourt between 1955 and 1960. The telegraphy service also witnessed a parallel development, from telegraph delivery by way of manual coordinated pegboard switching to the use of Morse code for telex switching. As at 1960, a manual telex exchange of sixty subscriber lines were in service in Lagos. All the above efforts were essentially aimed at improving internal administrative telephone services in Nigeria (Olatokun and Opesade 2008, Erinosho 2007, Obanya 2006, Ojokoh and Asaolu 2005).

At independence in 1960, with a population of roughly 45 million people, the country only had about 18,724 phone lines for use. This translated to a Tele-density of about 0.5 telephone lines per 1000 people. The telephone network consisted of 121 exchanges of which 116 were of the manual (magneto) type and only 5 were automatic. Between independence in 1960 and 1985, telecoms services become commercialized in Nigeria. The old department of Post and Telecommunications (P and T) under the Ministry of Communications became separated and Nigeria External Telecommunications Limited (N.E.T) was created to take care of external telecoms services while the old P and T handled internal network. By January 1985, the erstwhile (P and T) Post and Telecommunications divisions merged with NET to form Nigeria Telecommunication Limited (NITEL) a government owned Limited Liability Company ( Barry 2008 and World Bank 2001).

The objective of establishing NITEL was to harmonize the planning and coordination of the internal and external communications services, rationalize investments in telecoms development and provide accessible, efficient and affordable services. NITEL, the only national monopoly operator in the sector, was synonymous with epileptic services and bad management which made telephone usage then to be unreliable, congested, expensive and customer unfriendly.

According to Ajayi (2007), the years 1992 to 1999 was tagged as the partial liberalization era, when government embarked on market – oriented, partially liberalizing the Nigerian telecommunication sector via Nigerian Communication Commission (NCC) Decree 75 of 1992. The reforms include separation of the policy – making body from industry regulator and networks operators/service providers, and licensing of network operator service providers which began in 1996. Despite the huge potentials offered by the Nigerian telecom market, progress was slow due to political uncertainties and perceived policy inconsistencies as NITEL still continued to retain monopoly of power over voice telephony in both national and long distance international calls both argued that this period was dominated by chaotic, hopeless and frustrating circumstances. The Network was bad, there was weak infrastructural base, huge unmet demands, concentration of lines in selected urban centers, slow growth of subscriber base as well as limited investment.

          The Nigeria’s telecom sector witnessed a major revolution in 2001 with the granting of the Global System for Mobile Communication (GSM) license to providers. The target of National Economic Empowerment and Development Strategy (NEEDS) and the Nigerian Communication Commission (NCC) for the telecommunication sector include; Attainment of Tele-density (number of telephone lines in relation to population) of 1.25 by the year 2008. Prior to this, Nigeria maintained an unenviable record as the world’s third lowest, after Mongolia and Afghanistan, with a Tele-density of 0.73% before 1999. This essentially can be achieved with the advent of mobile telecommunication (GSM) that has resulted in a dramatic increase in the total number of lines from 866,782 in 1999, to over 60 million lines, in year 2008 out of which GSM operators accounted for 57, 622, 901 lines, fixed line operators accounted for 2,537,504 code division multiple access, CDMA, operators connected 780,938 lines [6]. This recent drive in telecom reform policy initiatives has made noticeable impacts on Nigeria (Okonji 2007).