NITEL Lost $6m to SAT 3

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Lanre Ajayi

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The Nigeria Telecommunications Limited is losing $300,000 monthly because the South Atlantic 3/West Africa Submarine Africa cable is not working

By Anayo Ezugwu  |  Feb. 9, 2015 @ 01:00 GMT  |

THE Nigeria Telecommunications Limited, NITEL, part owners of South Atlantic 3/West Africa Submarine Cable, SAT-3, has lost more than $6 million in the last one year due to a cut at the Nigerian end of the undersea cable infrastructure. Nigeria through NITEL holds 8.39 percent of SAT-3/WASC/SAFE which links countries along the west coast of Africa to each other and on to Europe and Asia.

The cut on SAT-3 occurred in June 2013 in the process of reclaiming land for the Lagos State initiative of a new town known as Eko Atlantic project. Realnews gathered that the shutdown of SAT-3 has resulted in the loss of bandwidth capacity estimated at 67 STM-1 and of this capacity only 15 STM-1 are demanded by players in the industry from the infrastructure. Anurag Garg, managing director, Direct on PC, DoPC, said NITEL may have lost $300,000 in monthly revenue during the period the infrastructure was inactive.

He noted that the impact of SAT-3 is not felt in the market because most organisations and Internet service providers, ISPs, subscribe to more than one undersea cable operator except for government agencies where it takes time to change from one operator to another. Apart from SAT-3, Nigeria is swimming in an ocean of bandwidth with an avalanche of undersea cable systems, each with landing points on the shores of the country.

There are various undersea cable projects including Main One and Glo 1; two home grown companies; the West African Cable System, WACS, an initiative operated by nine countries (including Nigeria’s MTN Group); and the ACE submarine cable system covering Nigeria and other countries.

Lanre Ajayi, president, Association of Telecommunications Companies of Nigeria, ATCON, said, “If it were some years back when we relied much on SAT-3, the impact would have been felt by many, but today not many people are aware that Sat-3 is down. This is why it is not good for government to be in business, if SAT-3 is own by an entrepreneur it would have been repaired and back to business long ago,” he said.

Realnews learnt that repair of a cut on undersea cable system takes a maximum of three weeks. This involves, renting of a cable ship from Cape Town in South Africa which is the only country where the ship is available in Africa; processing of custom papers; and obtaining approvals from the Nigerian Maritime Administration and Safety Agency, NIMASA, and other agencies to allow the ship to come into the country’s waters.  This SAT3/WASC/SAFE cable system was once hailed as technology and commercial breakthrough of unparalleled significance for Africa, offering a faster, more efficient trading channel between the continent and international markets.

Experts in the industry have said that the shutdown of SAT-3 is increasingly taking its toll on various sectors of the economy. According to industry experts, firms in the manufacturing, oil and gas and financial institutions that send their traffic through the cable are currently having a hard time coping.

Gboyega Ojuri, managing director, Junisat Nigeria, said the SAT-3 shutdown was taking its toll on businesses forcing many of them to seek alternative means of communication. He noted that SAT-3 and the entire NITEL was so important that the government should not have allowed the action in the first place. He said he knew that many oil companies and banks would be affected, stating that oil giant Shell Nigeria which depends heavily on SAT-3 would have been badly hit.

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