Ncell CEO Michael Foley has said that the company needs clarity from the government of Nepal for the launch of 5G. He has spoken on the need for facilitation from the government in frequency, investment, tax, and more, if the private telco is to bring the next-gen cellular technology in Nepal.
Table of contents
Ncell seeks policy clarity, including license status for 5G launch
Expressing his views on the latest SEJON news, Ncell CEO Michael Foley stressed that Nepal government must offer its clear and transparent policy clarity to Ncell to help facilitate the launch of the 5G network in Nepal. He also urged the state to speed up the process to introduce amendments into the existing telecom act and subsidies on frequency fees and taxes to ease the telecommunications industry. We have the highlights below.
5G crucial for Nepal’s digital ambitions
Folley states that Nepal’s future is tied to 5G. The technology is crucial for smart cities, AI, and cloud services. However, he says, Ncell and Nepal Telecom (NTC) both require between Rs 60 to and Rs 65 billion to expand the tech nationwide. He also opines that the telecom section requires consistent investment. But due to falling revenues, 5G investment looks challenging. The CEO Foley claims that the government should subsidize taxes, fees, and other fees.
What to Ncell after 25 years?
Ncell is reaching 25 years in 2029 (2086 BS). According to the prevalent Telco Act, a telco company comes under state control after 25 years. So, in the next five years, Ncell’s GSM license for services expires. At the moment, there are talks of Nepal government taking control of Ncell. Despite talks of Ncell coming under state ownership, Foley says, “We are clear that Ncell has the legal right in the Telco Act, 2053, and Rules if it does not want to go under government ownership after 25 years.”
Foley adds that Ncell can’t bring 5G live unless it’s clear what will happen to it after five years.
The state-run Nepal Telecom could launch 5G in Kathmandu and Pokhara in 2082. However, expanding the service across the country will take years and a huge investment.
On traditional BOT practice
Ncell CEO also opined that the government should eliminate older practices such as BOT (build, operate, and transfer) for the telco sector’s development. A transparent and convenient system must be arranged for companies with foreign investment to repatriate their dividends. Investors prefer to have legal clarity.
The telcos in Nepal might even soon implement subscription-based telecom services as part of their new business model to stay afloat.
Call for amendments in the Telco Act
Ncell CEO Foley also pointed to the ‘dated’ telecom act governing Nepal’s telecom sector. He said that the rules and regulations must be reformed with changes in telecom and information technologies. Nepal’s industry governing law is still the Telecommunications Act, 2053. The industry has seen evolution from 2G, 3G, 4G, to 5G discussions, but the regulations remain the same. It’s been a long time since the draft was prepared for the new Act. But it hasn’t been passed. The new Act will ease telcos in matters of license renewal fee, tariff plans, frequency fees, long-term planning, etc.
On Ncell’s contribution to the national GDP
Foley points out Ncell’s contribution to Nepal’s Gross Domestic Product metrics. He said, “Ncell alone contributed 0.6 percent to Nepal’s gross domestic product (GDP) and 1.7% to revenue collection in the last fiscal year 2081/82. Ncell has paid about 360 billion in taxes so far.”
He says that Nepal needs to attract foreign investment to strengthen its economy, but it requires policy clarity, transparent regulation, and a timely approval process. He also says that the 5G launch necessitates a clear legal policy for the telco sector.
Also: 5G vs Fiber: Find Out Which Is Better?
Foley states that Nepal has formulated the Digital Nepal Framework. It includes the objective of nationwide 4G and the start of 5G services. It will be only possible unless telecom companies increase investment, but that also requires policy-level facilitation from the government.
