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1 A DECADE OF DUAL DEREGULATI ON: COMMUNICATIONS REGULATORY POLICY REFORM IN NI GERIA, 1994 TO 2004 By ABUBAKAR DANLAMI ALHASSAN A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLOR IDA IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY UNIVERSITY OF FLORIDA 2008
2 2008 Abubakar Danlami Alhassan
3 To my older brother, Late Yusufu Alhassa nYou are by far a more brilliant, courageous, humble, honest, patient, gentle, kinder, and virtuous and pers on than I amMay Allah be pleased with your great humanhood.
4 ACKNOWLEDGMENTS Ut most gratitude rests with Allah (SWA). Ma y He grant mercies to my parents, Alhassan Gambo Abuja and Hadiza Kasuwa Abdullahi (Mat an Gambo Abuja) for their devotion to my well-being. Without the sacrifices of my older br other, Yusufu, this journey would have been abandoned a long way back. Only Allah and I know how much Yusufu means to me. My appreciation to the members of my committee for their input and suggestions without which this dissertation would not be read able. Friends, too numerous to mention, have remained encouraging and, I believe, have been supportive with prayers.
5 TABLE OF CONTENTS page ACKNOWLEDGMENTS...............................................................................................................4 LIST OF FIGURES.........................................................................................................................7 LIST OF ABBREVIATIONS.......................................................................................................... 8 ABSTRACT.....................................................................................................................................9 CHAP TER 1 INTRODUCTION..................................................................................................................11 Overview of Theoretical Framework...................................................................................... 16 Regulation and Public Policies........................................................................................ 16 Policy Reforms in Developing Countries........................................................................26 Creating Independent Regulatory Agencies ....................................................................30 Research Questions............................................................................................................. ....33 Methodology...........................................................................................................................33 An Outline of the Rest of the Dissertation.............................................................................. 36 Justification/Significance a nd Lim itations of the Study......................................................... 37 2 LITERATURE REVIEW.......................................................................................................41 Theoretical Justifications for Regulation and Public Policy................................................... 42 Communications Regulation..................................................................................................47 Deregulation as Regulatory Policy......................................................................................... 60 Independent Agencies as Imperative to Regulatory Policy.................................................... 62 Emergence of the Independent Regulatory Agencies..................................................... 63 International Telecommunicat ions Union Study Group Report ......................................68 Conclusion..............................................................................................................................72 3 HISTORICAL EVOLUTION OF THE OWNERSHIP STRUCTURE OF COMMUNI CATIONS INDUSTRY...................................................................................... 74 Colonial and Post-Colonial Communication Policies............................................................ 74 Colonial and Post-Colonial M onopolization of Broadcasting ......................................... 74 Colonial and Post-Colonial Monopolization of Telephony ............................................. 83 Commencing Regulatory Reforms.........................................................................................88 Dual Deregulation Commences..............................................................................................97 Conclusion............................................................................................................................101
6 4 LEGISLATING REGULATORY REFORMS, AGENCIES ORGANIZ ATIONAL STRUCTUTE, AND THE IMPACT OF REFORMS ON THE COMMUNICATIONS ENVIRONMENT.................................................................................................................105 Establishing Regulatory Agencies : T he Statutory Instruments............................................ 105 The NBC Decree........................................................................................................... 106 Regulating Religious Expre ssions on the Airwaves ......................................................111 The NCC Decree........................................................................................................... 118 A New Communications Act.........................................................................................123 NCC Decree vs. Nigerian Communications Act ...........................................................130 Agencies Organizational Structure...................................................................................... 132 NCCs Organizational Structure.................................................................................... 133 NBCs Organizational Structure.................................................................................... 134 Conclusion............................................................................................................................136 5 A DECADE OF DUAL DEREGULATI ON AND THE CHANGE D STRUCTURE OF COMMUNICATION SECTOR: A DI SCUSSION AND ANALYSIS............................... 138 The Changed Structure of Communications Sector............................................................. 138 Answering the Research Questions...................................................................................... 144 First Research Question................................................................................................. 145 Second Research Question............................................................................................146 Third Research Question...............................................................................................157 Fourth Research Question............................................................................................. 159 6 SUMMARY, CONCLUSIONS, POLICY RECOMMENDATIONS, AND SUGGESTI ONS FOR FURTHER STUDIES...................................................................... 163 Summary and Conclusions...................................................................................................163 Policy Recommendations.....................................................................................................166 Suggestions for Further Studies............................................................................................ 168 LIST OF REFERENCES:............................................................................................................170 BIOGRAPHICAL SKETCH.......................................................................................................178
7 LIST OF FIGURES Figure page 1-1 Global growth of regulatory agen cies (adapted from ITU reports) ...................................12
8 LIST OF ABBREVIATIONS BBC British Broadcasting Corporation DBS Direct Satellite Broadcast FCC Federal Communications Commission FRCN Federal Radio Corporation of Nigeria ITU International Telecommunications Union MMDS Multichannel Multipoint Distribution Service NBC National Broadcasting Commission NCC Nigerian Communications Commission NFMC National Frequency Management Council NITEL Nigerian Telecommunications Limited NMCP National Mass Communication Policy NTA Nigerian Television Authority NTP National Telecommunications Policy UNESCO United Nations Educational, Scie ntific, and Cultural Organization WTO World Trade Organization
9 Abstract of Dissertation Pres ented to the Graduate School of the University of Florida in Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy A DECADE OF DUAL DEREGULATI ON: COMMUNICATIONS REGULATORY POLICY REFORM IN NI GERIA, 1994 TO 2004 By Abubakar Danlami Alhassan December 2008 Chair: Justin Brown Cochair: Michael Leslie Major: Mass Communication Nigeria, Africas most populous nation, co mmenced deregulation of its communication sector in the early 1990s. The then military regime enacted legisl ation that established regulatory agencies named National Broa dcasting Commission (NBC) and Nigerian Communications Commission (NCC) to deregulate the broadcasting and telecommunications sector respectively. Until this development, telephony was the exclusive monopoly of the federal government and the federal and state governments exclusively monopo lized broadcasting. The first licensed private communications providers commenced operations in 1994. About a decade after commencing the regulatory reforms, i.e. by the end of 2003, there is significant ch ange in the Nigerian communications sector including ov er 100 percent increase in the number of broadcast stations and over 400 percent increase in the teledensity of the country. This study, adopting communication regulations theories and the ITU Guidelines for establishing communications regulatory agencies as analyti cal framework, examined the regulatory policy reform that is credited with these significant changes in th e Nigerian communications sector. The study found that both public and private interests, bureaucratic elements, as well as local and global factors influenced the regulatory policy reforms in Nigeri as communications sector in the last decade.
10 Consequently, it is difficult, if not impossible, to explain Nigeri as regulatory policy reforms in terms of a single existent communications regulati ons theory. In view of the inadequacy of the existent theories to explai n Nigerias communication regula tory policy reform, the study suggested the adoption of the theory of govern ment failure as anal ytical framework for examining communications regulatory policy reforms in developing countries like Nigeria. Further, the study found that based on the IT U Guidelines, while the telecommunications regulator, NCC, may be said to be somewhat i ndependent, that is not the case with NBC, the broadcast regulatory agency. The study concluded by suggesting regulatory policy reforms necessary to make the NBC independent a nd to enhance the independence of NCC.
11 CHAPTER 1 INTRODUCTION Telecomm unications regulatory policy reform, largely resulting from globalization and technological development is occurring at an unprecedented rate.1 In Sub-Saharan African countries like Nigeria, cha nges in telecommunications regul atory policy have resulted in increased access to voice services, especially mobile telephones;2 expanded Internet access (though user penetration is stil l comparatively low only one tenth of worlds average);3 and reduced costs for engaging in bus iness transactions (although broadband and international calls are still the most expensive in the world).4 In addition, regulatory reforms in broadcasting are credited with expanding communication channels through the licensing of private broadcasters.5 Prior to regulatory reforms, both tel ecommunications and broadcasting were the exclusive monopoly of governments in Sub-Saharan African countri es including Nigeria.6 One observer noted that African governments rushed to control media, telecommunications and postal services immediat ely after independence.7 According to Goran Hyden and Michael Leslie for nearly two decades government control a nd monopoly of communications was justified on 1 INTERNATIONAL TELECOMMUNICATIONS UNION, ESTABLISHMENT OF AN INDEPENDENT REGULATORY BODY 2 (2001). 2 PEIRRE GUISLAIN, MAVIS AMPAH, LARENT BESANCON, CECILE NIANG, AND ALEXANDRE SEROT. CONNECTING SUBSAHARAN AFRICA: A WORLD BANK GROUP STRATEGY FOR INFORMATION AND COMMUNICATION TECHNOLOGY SECTOR DEVELOPMENT 5 (2005). 3 Id at 6. 4 Id at 7. 5 Goran Hyden and Michael Leslie, Communications and Democratization in Africa in MEDIA AND DEMOCRATIZATION IN AFRICA 1 (Goran Hyden, Michael Leslie & Folu Ogundimu eds., 2002). 6 Folu F. Ogundimu, Private-enterprise broadcasting and accelerating dependency: Case studies from Nigeria and Uganda. 58 GAZETTE: INTL. J. FOR COMM. STUDIES, 159, 160 (1996). 7 Chris W. Ogbondah, Media Laws in Political Transition, in MEDIA AND DEMOCRATIZATION IN AFRICA 60 (Goran Hyden, Michael Leslie & Folu Ogundimu eds., 2002).
12 the basis of national development but the s ituation began to change in the 1980s when government power began to be viewed as a potential detriment to national development.8 The reforms in Nigeria may be viewed as part of an increasing global diffusion of regulatory reforms,9 which has led to the emergence of new regulatory policy institutions impacting social and economic life.10 Among the new regulatory policy institutions that have emerged are national telecommunications regulat ory agencies, the number of which, according to the International Telecomm unications Union (hereafter the ITU), has grown globally from only 12 in 199011 to 124 by mid-200212 and has reached 140 by the year 2005.13 0 20 40 60 80 100 120 140 160 199020022005 Number of Agencies Figure 1-1: Global growth of regulatory agencies (adapted from ITU reports) 8 Goran Hyden and Michael Leslie, Communications and Democratization in Africa, supra note 5, at 1. 9 DAVID LEVI-FAUR AND JACINT JORDANA, THE RISE OF REGULATORY CAPITALISM: THE GLOBAL DIFFUSION OF A NEW ORDER, 598 THE ANNALS OF THE AMERICAN ACADEMY OF POLITICAL AND SOCIAL SCIENCE 6 (2005). 10 Id. 11 Supra note 1. 12 INTERNATIONAL TELECOMMUNICATIONS UNION, TRENDS IN TELECOMMUNICATION REFORM 2003: PROMOTING UNIVERSAL ACCESS TO ICTS 3 (2003). 13 INTERNATIONAL TELECOMMUNICATIONS UNION, TRENDS IN TELECOMMUNICATION REFORM 2006: REGULATING IN THE BROADBAND WORLD 17 (2006).
13 Nigeria, Africas most populous nation, comme nced communications sector regulatory policy reform in 1992 when the then military regime enacted two decrees establishing the Nigerian Communications Commission (NCC)14 and National Broad casting Commission (NBC)15 as regulatory agencies for telecommunica tions and broadcasting respectively. The NBC Decree was enacted following the adoption of a National Mass Communication Policy two years earlier. In the year 2000 the government a dopted a National Telecommunications Policy16 based upon which a new Communications Ac t was enacted in the year 2003.17 The NCC was conferred with the broad responsibility for technical and economic regulation of the privatized sector of the telecommunications industry18 and specifically with facilitating the entry of private providers into markets for telecommunication services,19 promoting fair competition and efficient market conduct20 and establishing technical standards.21 The NCC is also responsible for the implementation of the Governments general policies on co mmunications industry.22 Similarly, the NBC was conferred with, among ot her responsibilities, receiving and processing 14 NIGERIAN COMMUNICATIONS COMMISSION DECREE NO. 78 S. 2(a), Federal Republic of Nigeria Official Gazette, Supplementary to Official Gazette Extr aordinary, No. 71, Vol. 79, 31st December, 1992 (hereafter NCC Decree 1992). 15 NATIONAL BROADCASTING COMMISSION DECREE NO. 38 S. 1, Federal Republic of Nigeria Official Gazette, Supplementary to Official Gazette Ex traordinary No. 33, Vol. 79, 4th Sept ember, 1992 (her eafter NBC Decree 1992). 16 FEDERAL REPUBLIC OF NIGERIA, NATIONAL TELECOMMUNICATIONS POLICY (2000), available at www.ncc.gov.ng (last accessed December 12, 2006) 17 NIGERIAN COMMUNICATIONS ACT 2003 S. 150 (assented to by President Olusegun Obasanjo on 8 th July, 2003). (hereafter the NCC Act 2003). 18 NCC Decree 1992 S. 4(a). 19 NCC Decree 1992 S. 2(b). (Section 15(h) identified telecommunication undertakings to include provision and operation of public pay-phones, provision and operation of private network links by cable, radio or satellite, provision and operation of mobile communication, community telephones, value added networks and repair and maintenance of telecommunication facilities.) 20 NCC Decree 1992 S. 2(a). 21 NCC Decree 1992 S. 2(h). 22 NCC Act 2003 S. 4(1).
14 applications for the ownership of private broa dcasting services includ ing cable television and direct broadcast satellite (DBS).23 NBCs responsibility also includes advising the government generally on the implementation of the Natio nal Mass Communication Policy with particular reference to broadcasting.24 Both commissions commenced operations in 1993 and licensed the first private telecommunications operators (PTOs) and private broadcasters that same year. The newly licensed PTOs and private broadcasters commenced business in 1994 and within a decade, i.e. by the end of 2004 Nigerias teledensity had gr own exponentially from only about 500,000 main lines and 12,800 mobile lines to 1,027,500 main line s, and 9,147,200 mobile li nes; thus the total lines about 10, 147,700.25 The broadcasting industry also grew, as the number of private and public broadcast stations in Nigeria rose to 160 by 2004, almost doubling the ninety broadcast stations that existed when the NBC commenced operations.26 Beyond broadcast stations, the NBC also licensed about ten cable re-transmission and DBS providers,27 thereby improving the hitherto chaotic situation where almost all DBS and cable retransmission providers were said to be operating illegally.28 Despite these progress, the commissi ons have also had their challenges or set backs including the con tinuing problem of interconnecti on and universal service in the 23 NBC Decree 1992 S. 2(1b). 24 NBC Decree 1992 S. 2(1a). 25 INTERNATIONAL TELECOMMUNICATIONS UNION, WORLD TELECOMMUNICATIONS INDICATORS (BASIC INDICATORS) 1 (2005). 26 Media Rights Agenda, Government Grants 21 Broadcast Licenses (n. d.) available at http://www.internews.org/mra/mrm/mar02/mar02_front2.htm (last accessed December 1, 2005). 27 National Broadcasting Commission, Licensed Stations (n.d.) available at http://www.nbcnig.org/Licenced_stations.asp 28 Chuka Onwumechili, Privatization of the Electronic Media in Nigeria 7, HOWARD J. OF COMMUNICATION 366 (1996).
15 telecommunications sector and th e licensing process and enforcem ent of political programming regulations in the broadcasting sector. The regulatory policy reform which ended government monopoly of telecommunications and broadcasting is regarded as deregulation in th e sense that, as Martha Derthick and Paul Quirk observe, it led to the removal, to whatev er degree, of the earlier restrictions.29 This dissertation examines Nigerias communication polic y reforms with a particular emphasis on the ten-year time frame of 1994 to 2004 when substantial deregulation occurred. Although, as Jeremy Tunstall rightly observed, communicatio ns deregulation has no neat beginning and hardly a neat ending,30 the year 1994 marked the commencement of operations by the licensees and during the ten years that follo wed there had been five years of military rule (1994-1999) and five years of democratic rule (1999-2004). Ther efore, the decade 1994-2004 seemed an adequate time for the policies to have germinated and fo r their implications to be obvious enough for examination. This dissertation will be conducted fro m the prism of the five theories of telecommunication regulation iden tified by Robert Horwitz, name ly public interest, regulatory failure, conspiracy-capture, organi zational behavior, and capitalist state theory, with the aim of ascertaining which of the theories best explains the deregulation of communications in Nigeria.31 The employment of this theoretical framework is functional because, according to Ann Majchrzak, unlike hypothesis testing where a study sets out to test specific theories, the multidimensional nature of policy research makes it too great a risk and luxury to approach a 29 MARTHA DERTHICK AND PAUL QUIRK, THE POLITICS OF DEREGULATION 34 (1985). 30 JEREMY TUNSTALL, COMMUNICATIONS DEREGULATION: THE UNLEASHING OF AMERICAS COMMUNICATIONS INDUSTRY 6 (1986). 31 ROBERT B. HORWITZ, THE IRONY OF REGULATORY REFORM: THE DEREGULATION OF AMERICAN TELECOMMUNICATIONS 23 (1989).
16 [policy] problem with predetermined theory of its causes and effects.32 Rather, the policy researcher engages in iterative process whereby information a nd model building are constantly interchanged.33 Overview of Theoretical Framework An examination of regulatory policy refo rm, which is the subject of this study, necessitates an overview of theoretical framewor k to be used in the study. While a detailed examination of theories of re gulation and public policy will be undertaken in ch apter of this dissertation, the focus of the following discussion is on the specific theories of regulation and public policy that will be used as the studys fram ework. And, in the light of this studys focus on Nigeria, this section will also focus on literat ure that articulates policy reform efforts in developing countries. Regulation and Public Policies Regulation and policies are intertwined not onl y because each is employed to achieve the objective of the other but also because theories employed to examine both are very similar. But a clear understanding of what regulation and polic y mean is necessary in order to identify the theories used to examine them. Although it is di fficult to define public policy, but according to James Anderson,34 a review of several public policy texts indicates that one of the most cited definitions is Almond, Powell, Dalton, and Strms, which stated that public policy encompass all those authorita tive decisions that governments make.35 Regulation is similarly without a single definition. For example, Marc Eisner Jeff Worsham, and Evan Ringquist define regulation as an array of public policies explic itly designed to govern economic activity and its 32 MAJCHRZAK, METHODS FOR POLICY RESEARCH, supra note 32 at 19. 33 Id. 34 JAMES E. ANDERSON, PUBLIC POLICYMAKING: AN INTRODUCTION 5 (1994). 35 GABRIEL ALMOND AND B. G. POWELL, COMPARATIVE POLITICS TODAY: A WORLD VIEW 130 (1984).
17 consequences at the level of the industry, the firm, or individua l unit of activity.36 Robert Baldwin views regulation as the promulgation of an authoritativ e set of rules, accompanied by some mechanism, typically a public agency, for monitoring and promoting compliance with these rules.37 Thus, it may be apt to conclude that re gulation is one of the mechanisms that policymakers utilize to achieve policy objectives by constraining the range of activities in which an individual or organization can engage.38 Definitions of communication policy also varies, ranging fr om the brief one offered by Patricia Aufderheide as a calcula ted government intervention in the structures of businesses that offer communications and media services,39 to a more detailed one proffered by Hamid Mowlana and Laurie Wilson who, based on a definition by UNESCO,40 described communication policy as: systematic institutionalized principles, norms, and behavior that are designed through legal and regulatory procedures and/ or perceived through historic al understanding to guide the formation, distribution, and cont rol of communication in both its human and technological dimensions. Furthermore, communication polic ies (or the perceived lack of policies) reflect the prevailing cultural, political, and economic behavior of a given system.41 From the foregoing definitions, it may be discerned that within the cont ext of this study both public policy and regulation are government interventions in th e communications sector. The 36 MARC ALLEN EISNER, JEFF WORSHAM, EVAN J. RINGQUIST, CONTEMPORARY REGULATORY POLICY 5 (2000). 37 ROBERT BALDWIN, COLIN SCOTT, AND CHRISTOPHER HOOD, Introduction, in A READER ON REGULATION 3.(Robert Baldwin, Colin Scott, and Christopher Hood eds., 1998) 38 MAJCHRZAK, METHODS FOR POLICY RESEARCH, supra note 32, at 25. 39 PATRICIA AUFDERHEIDE, COMMUNICATIONS POLICY AND THE PUBLIC INTEREST: THE TELECOMMUNICATIONS ACT OF 1996 5 (1999). 40 UNESCO, REPORTS OF THE MEETING OF EXPERTS ON COMMUNICATION POLICIES AND PLANNING 2 (1972) (defining communication policy as sets of principles and norms established to guide the behavior of communication systems). 41 HAMID MOWLANA AND LAURIE J. WILSON, THE PASSING OF MODERNITY: COMMUNICATION AND THE TRANSFORMATION OF SOCIETY 107 (1990).
18 question that deserves theoreti cal explication then is why do governments enact public policies and regulations in the first place? According to Robert Horwitz, five theori es of telecommunication regulation include public interest, regulatory failure, conspiracy -capture, organizational behavior, and capitalist state theory.42 In his book, The Irony of Regulatory Reform Horwitz discusses public interest theory extensively and then examines the other four theories in relation to how they serve or fail to serve the public interest. He argued that public interest theory is generally derived from legislative intent of regulations that seek to resp ond to the potential confli ct between interests of private corporations and that of the communities or general public.43 Therefore, when the workings of the free market fail to protect th e public from monopolisti c and other corporate abuses, government intervenes in order to protec t the public interest by correcting the workings of the market.44 Proponents of this theory view the creation of regulatory agencies as the concrete expression of the spirit of democratic reform [and] a s the victorious result of the peoples struggle with corporate interest.45 Proponents of public intere st theory also view deregulation as a measure to dismantle cartels an d monopolies or oligopolies in order to pave the way for competition in th e interest of consumers.46 Unlike public interest theory which emphasi zes the historical circumstances of the emergence of regulatory agencies, regulatory failure theory focuse s on the operations of regulatory agencies. Proponents of the theory post ulate that the attempt to regulate businesses is 42 HORWITZ, THE IRONY OF REGULATORY REFORM, supra note 31, at 23. 43 Id 44 Id at 24. 45 Id 46 Id at 17.
19 a failure largely because the regulators may l ack the willingness or th e capacity to enforce regulations in the interest of the public either because their appointment was influenced by the industry or because they were drawn from the i ndustry or are looking forward to a career in the industry. Regulatory failure theorists also argue th at because the agencies lacks the industries resources for gathering the information necessary for policymaking, the agencies rely too much on the industries for such vital information and e nd up not only getting too close to the industry that they regulate but seeing things from the perspective of the industry.47 Similarly, conspiracy-capture theory, an outgrowth of the Chicago school of free market philosophy,48 views the attempt to enact regulations as nothing but the result of the request by the industry for regulation in order to prevent competition through price and entry restriction. Where the industry did not initiate regulation, then subsequent actions of the regulatory agency are said to be at the behest of the regulated businesses. In short, the concerned industries either conspire to init iate regulation or the establishment of a regul atory agency. If the agency was established by popular demand, th e industry then scheme s to capture the regulatory agency upon establishment.49 The organizational behavior theory posits that regulatory agencies are like other organizations that are concerned or preoccupied w ith their integrity and survival more than the interest of the public. Th erefore, regulatory agencies can act in order to appease the most powerful contending party or to strike a comp romise between the contending parties depending 47 Id at 27. 48 The Chicago School is reference to the economists who taught and authored many articles at the University of Chicago from the 1960s to 1980s who argued vigorously against government intervention in the economy and used statistical methods and quantitative analysis to th eorize that free market laissez faire is better than government regulation. Fore most among these scholars are Milton Friedm an, George Stigler, Gary Becker, and Richard Posner. See generally THE CHICAGO SCHOOL OF POLITICAL ECONOMY (George Stigler, ed., 1988). 49 HORWITZ, THE IRONY OF REGULATORY REFORM, supra note 31 at 23.
20 on what will serve their [agencies] organization s interests and the well-being of their agency.50 The capitalist state theory argues that regulatory agen cies operate as part of the structures of the capitalist system whose overall aim and objective is to protect private property and the system of capitalism. The agencies theref ore regulate with the sole aim of ensuring the survival and continuity of the capitalist system regardless of whose individual interest may be hindered.51 Horowitz concluded that each of the theo ries of regulation emphasizes the origins, structures, processes or the operations of the ag encies and therefore each theory has something to offer to the understanding of regulation while each theory also has its shortcomings.52 Consequently, none of the theories adequately explain regulation and it is therefore often problematic to speak of a singl e exclusive regulatory theory.53 This assertion about la ck of regulatory theory is buttre ssed also by Lori Brainard who, in her book titled, Television: The Limits of Deregulation54 posited that there are three major explanations (theories) for the origins of regulation, namely ma rket forces theory, industry capture theory, and contingency theory.55 The market forces theory c ontends that public interest sometimes, especially in response to econom ic and technological changes, necessitates regulation in order to correct or im prove the workings of a marketplace.56 Industry deterministic (or industry capture) theory argues that firms seek regulation to in sulate them (the firms) from market competition and maximize the firms prof its and politicians and agency personnel accede 50 Id. at 38. 51 Id 52 Id at 43. 53 Id at 46. 54 LORI A. BRAINARD, TELEVISION: THE LIMITS OF DEREGULATION 6 (2003). 55 Id 56 Id at 9.
21 to such industry wishes in a form of protectionist corporate welfare.57 Finally, the contingency theory argues that regulatory policy change is fl uid and therefore not ne cessarily determined by economic and technological change s or industry interests only.58 Therefore, in addition to economic and technological changes as well as in dustry lobbying, other factors and actors such as ideas, ideologies of policymakers, citizen advocacy groups, nonprofit organizations, and noneconomic values like equity all contribute to the regulatory policy processes and outcome.59 There are hardly any theories on regulati on in developing countries perhaps because regulatory policy reforms in those countries ha ve only occurred in the last two decades. Nevertheless there is a growing body of scholar ship that examines the general public policy process in developing countries like Nigeria. One of the best known typologies of the policy process in developing countries is the one that was initially de veloped by Merilee Grindle and John Thomas,60 which was also adopted (and slightly modified) by Mark Turner and David Hulme in their examination of public policy and management in developing countries.61 Grindle and Thomas argued that about six theories are employed to explai n the public policy process in developing countries, namely cla ss analysis, pluralist analysis, public choice analysis, rational actor model, bureaucratic politics th eory, and state interest theory.62 57 Id at 8. 58 Id at 9. 59 Id 60 MERILEE S. GRINDLE AND JOHN W. THOMAS, PUBLIC CHOICES AND POLICY CHANGE: THE POLITICAL ECONOMY OF REFORM IN DEVELOPING COUNTRIES 20 2 (1991). 61 MARK TURNER AND DAVID HULME, GOVERNANCE, ADMINISTRATION AND DEVELOPMENT: MAKING THE STATE WORK 64 (1997). 62 GRINDLE AND THOMAS, PUBLIC CHOICES AND POLICY CHANGE, supra note 60 at 20.
22 The class analysis approach argues that the st ate exists to enact and enforce policies that serve the exploitative interests of the dominant class in the so ciety. The inadequacy of this Marxist-based theory in explaining why the state sometimes acts against the interests of the dominant classes or make policies that benefit the dominated classe s led neo-Marxists to theorize that the state occasionally acts against some indi vidual capitalists in the interest of capitalism because the superstructure of the cap italist system is what matters most.63 In this case, the state is assigned a predetermined role of rescuing the ca pitalist order and policymakers main objective is ensuring the survival of the capita list order nationally and internationally.64 On the other hand, the pluralism approach posit s that public policy results from conflict, bargaining, and coalition formation among a poten tially large number of societal groups organized to protect or advance particul ar interests common to their members.65 In this case the groups interests are usually economic though gr oups are also formed based on ethnicity, religion, values, and regions as well. These intere st groups are the initiators of public policy and the state serves as the arena for battling and ba rgaining about the final policy outcome. The state is either neutral in such circumstances or the groups with greater resource s and access to political institutions effectively in fluence the policy outcome.66 Somewhat linked to the pluralism approach is the public choice theory, which argues that both the state and the society are composed of self-interested individuals all intent on maximizing their personal benefits. In other words, private individuals coalesce with public officials to engage in rent-seeking, which is extr acting personal/private be nefits from the state 63 Id at 21. 64 Id at 22. 65 Id at 23. 66 Id at 23.
23 resources and or using state apparatuses. The co nsequence here is a st ate that is captured by narrow interests, policies that are distorted in economically irrationa l ways by self-seeking groups and public officials th at are always suspect.67 Unlike the pluralism model where the state may be neutral actors, public choice theory argues that state officials are usually accomplices in utilizing public polic y to further private interests. The rational actor model of explaining public policy gives primacy to the ability of an agency and its personnel to gather all the necessary information on the policy issue and to rationally assess and evaluate the information in or der to determine the best alternative course of action.68 However, in view of the cost and time involved in such gathering and evaluating information, as well and the incompleteness of the data available, policymakers and their organizations (agencies) engage in satisficing, which is proffering a satisfact ory rather than an optimal solution. If confronted with the need for policy change, policymaker s are said to engage in incrementalism, that is marginal change s over time. In other words, the rational actor theorists give credit to the policymakers for playi ng a role in the policy process but explain that satisficing and incrementalism are the reason s why far reaching reforms are hardly initiated or adopted.69 According to bureaucratic politics theor y, public policy is largely the result of competing activities among bureaucratic entiti es and actorsintragovernmental bargaining, conflict, and decision making.70 Therefore, policies are in itiated by the bureaucrats and policymaking apparatuses rather than interest or dominant groups in the society. The views of 67 Id at 25. 68 Id at 28. 69 Id at 29. 70 Id at 30.
24 these bureaucrats and policymakers are influenced not only by their positions but also by how the policy outcomes will enhance their position and that of their organization (agency). In other words, they are motivated by quest for grea ter power and budgetary resources for their organizations and it is their profes sional and organizational interests rather than the interests of the society that prevails in the policy process and outcomes. In contrast to bureaucratic theory, state interest theory vi ews the state as an autonomous powerful actor in its own right with the capac ity of defining public problems and developing solutions for them.71 In this case the state has its own interests and therefore it enacts policies in pursuit of those interests that may include mainte nance of social peace and promotion of national development or even maintaining its hegemony and retaining power. Under this approach, public policies may or may not be the result of societal pressure s and policy outcomes may either be beneficial or detrimental to powerful intere st groups. The independe nce and powerful nature of the state is such that no group may impose its wishes on the state and therefore it is not possible to infer who initiates policy or who cont rols the state from who benefits from policy outputs.72 In conclusion, Merilee and Thomas observe th at the first three theories class analysis, pluralist analysis and public choice analysis are society-centered because they confer too much power on societal groups. In contrast, th e last three theories rational actor model, bureaucratic politics theory, and st ate interest theory are statecentered because they give all credits for policymaking to state actors in the policymaking process. Therefore, they (Merilee and Thomas) contend that neither the society-centered nor state-centered theories can adequately 71 Id 72 Id at 31.
25 explain the policy process in de veloping countries where policy el ites significantly shape policy choices but are also cle arly influenced by the actual or pe rceived power of societal groups and interests that have stake in reform outcomes.73 Further, they observed that beyond the societal and state actors, the policy process in devel oping has an internati onal context due to the economic and political dependency of the deve loping countries on multilateral and bilateral institutions.74 Therefore policy reform initiatives are heavily influenced and sometimes imposed by international financial institutions and pa rticularly the World Bank, the International Monetary Fund, and, increasingl y, World Trade Organization.75 However, regardless of the roles played by global factors and s upranational bodies such as the World Bank and International Telecommunications Union, it has been argued that communication polic ies are still largely developed at the national level and nati on states will remain the engine rooms76 of media policy by asserting their social and cultu ral principles in policy frameworks.77 Therefore, policy analysts must continue to compare and contrast the regulatory initiatives now apparent across the diverse field of national policy developments78 Other than the international context intr oduced by Merilee and Thomas, most of the theories employed to explain the public policy process have similarities with the theories of regulation outlined by Horwitz. For example, the class analysis theory and capitalist state theory are both influenced by a Marxist analytical approach. The public choice approach and the 73 Id at 33. 74 Id at 39. 75TURNER AND HULME, GOVERNANCE, ADMINISTRATION AND DEVELOPMENT, supra note 61, at 220. 76 BEN GOLDSMITH, J. THOMAS, AND T. O'REGAN, Cultural and Social Regulatory Principles in Converging Media Systems, in GLOBAL MEDIA POLICY IN THE NEW MILLENNIUM 93 (Marc Raboy, ed., 2003). 77 Id at 106. 78 Id at 93.
26 conspiracy-capture theory are bot h informed by the notion of self -interested individuals engaged in rent-seeking. The organizationa l behavior theory and bureaucrat ic politics theory all view policymakers as preoccupied with their organi zations well-being rath er than the broader publics interest. The state interest approach and public in terest theory tend to view state as an autonomous actor capable of initiating and enacting policies in the interest of the society. Since most of the theories identifie d by Merilee and Thomas are about public policy in general and have been employed in examining policy process in developing countries w ith varying results (as we shall see shortly), this dissertation will em ploy the theories identified Horwitz not only because they are specific to communications re gulation, but also because they have not been previously used to examine communica tions deregulation in Nigeria. Policy Reforms in Developing Countries Analyses of the policy process in developing countries may be characterized by the two opposite conclusions of the studies. First, acco rding to Goran Hyden, unlike in the West (America and Europe), where policy analysis en tails the application of economic principles, policy making in Africa is not based on economic rationale.79 He identified three factors responsible for this situation, which he describe d as policy deficit. These three factors are: Africas desire to catch up with the developed world thereby re legating every consideration including economics in the process; African governments percep tion of the former colonialists as responsible for financing Africas development due to th e terrible consequences of colonialism; and development aid provided made government less concerned with costs.80 Hyden argued that neopatrimonialism, which he de fined as the absence of a separation between the private and the official sphere s is still widespread in Africa. Therefore rather than using 79 GORAN HYDEN, AFRICAN POLITICS IN COMPARATIVE PERSPECTIVE 116 (2006). 80 Id
27 public policy as instrument for mediating rela tions between private interests and public goods, African governments are more preoccupied with gaining advantage in multiparty politics by using state resources for patronage.81 Moreover, organized interests are relatively absent or at best not strong enough to influence policymaking a nd facilitate its management. As a result, economics is marginalized by politics in the po licymaking process and policy intervention may be done regardless of potenti al costs and benefits, feas ibility and sustainability.82 Finally, Hyden observed that African governments derive legitimacy by seemingly resisting external powers, including the prescriptions of multilate ral institutions that may be urging economicbased policies. He concluded that the policy deficit is why po licy in African countries rarely leaves behind a living legacy that society can build on and why African governments are not real policy governments.83 Simlarly, Mark Turner and David Hulme,84 citing examples from Africa, Latin America, and the Middle East, observe that public policy is characterized by patronage and coercion rather than participation because authoritarian re gimes of many developi ng countries restrict policymaking to a narrow circle of government officials and mass organizations and other interest groups have either been suppressed or coerced into apathy. They illustrate this situation by pointing out how, in Sub-Saharan African co untries, which are predominantly agrarian societies, agricultural policies either neglect or ev en lead to exploitation of the majority peasant 81 Id at 136. 82 Id 83 Id at 22. 84 MARK TURNER AND DAVID HULME, GOVERNANCE, ADMINISTRATION AND DEVELOPMENT, supra note 61, at 7173.
28 farming families largely becau se such policies are constructed by a coalition of rulers, bureaucrats, urban workers, local industrialis ts, and occasionally multinational corporations.85 However, contrary to the theses of Gora n Hyden and Turner and Hulme, Grindle and Thomas, who examined about a dozen cases of su ccessful policy reforms in developing countries in Africa, Latin America, and Asia, found that policymakers are neither captives of special interests nor individuals in pursuit of self or organizational interests but active initiators of reforms. The authors concluded th at the policymakers of the deve loping countries they examined initiated and or changed policies not for self-seeking reasons but because they were motivated by a perspective derived from per sonal and professional values th at frequently include serious concern for the public interest and pu blic welfare of their societies.86 Similarly, Judith Tendler observed that a lot of what has been written about governments in developing countries are findings that the officials in those count ries serve their private, rather than the public interests and the governments engaged in clientelism, overspending on badly conceived programs that create myriad opportunities for bribery, influe nce peddling and other forms of malfeasance.87 She noted that such earlier examin ation of developing countries public policy that reach these conclusions include Anne Kruegers examination of Turkey.88 However, in her (Tendlers) examination of four cases of public sector reform s carried out by a state government in Brazil namely rural preven tive health, employment creating programs, agricultural extension, a nd assistance to small enterprises she found that the performance of these programs changed rapidly from bad to good in the mid 1980s and remained so until the 85 Id 86 GRINDLE AND THOMAS, PUBLIC CHOICES AND POLICY CHANGE, supra note 60, at XIV. 87 JUDITH TENDLER, GOOD GOVERNMENT IN THE TROPICS 1 (1997). 88 Anne Krueger, The Political Economy of Rent-Seeking Society 64 AMER. ECON. REV. 291-303 (1974).
29 time of her writing in 1997.89 She observed that although the World Bank and media reports tend to attribute the successes of the programs to the leadership of two successive reformist governors,90 her study found that the success of the refo rms are due primarily to the efforts of dedicated workers. These workers carried out la rger tasks than usual and did not exploit the greater autonomy and discretion resulting from the larger tasks they were assigned to perpetrate the rent-seeking misbehaviors that public-sec tor reformers worry about graft, bribery, and other malfeasance[rather the] workers wanted to perform better in order to live up to the new trust placed in them by their clients and citizen s in generaland the publ ic messages of respect from the state.91 As the above discussion shows differing pos tulations on public policies in developing countries so does the literature on communication policie s in developing countries. For example, on the one hand Mowlana and Wilson argue that because communication policies are usually derived from the countrys institutional system and the political and economic environments under which they operate, the policies tend to legitimize the existing power relations, which are not necessarily working for the best interests of the developing country.92 On the other hand, Ogundimu and Iheduru, argued that African countri es have initiated policy reforms in the communications-sector li ke denationalization, pr ivatization, and freemarket policies that are dismantling or modifyi ng inflexible command an d control management 89 TENDLER, GOOD GOVERNMENT IN THE TROPICS, supra note 87, at 8 (1997). 90 Id at 13. 91 Id at 14-15. 92 HAMID MOWLANA AND LAURIE J. WILSON, THE PASSING OF MODERNITY 109 (1990).
30 structures inherited from colonial administrations.93 They argued that these systems were initially maintained by African countries not only because they inherited them from colonial governments but also because that system was su itable for meeting result-oriented outcomes that was encouraged by aid agencies such as the World Bank. They also contended that Africas inadequate postcolonial communicat ions and transportation infrastructures are partly due to bad governance but also are a product of antiquated, centralized, and au thoritarian systems inherited from colonialism that the indigenous governments initially retained because they provided the most opportunities for control ling the system of patronage. They (Ogundimu and Iheduru) concluded that positive hopes and optimism should be gleamed from two facts: postcolonial subSaharan African governments spent huge resources expanding infrastructure s; and the pressure to reform the authoritarian systems is leading to pluralism and commercially viable communications systems because of the efficien t and appropriate regulatory environments and policies that are emerging.94 In conclusion, the literature indicates that there have been negative and positive outcomes of public policies and reforms in developing countries. Regardless of the end result, there is usually a government agency re sponsible for implementing the po licies or reforms. In the communications sector it is the regulatory agencies that are usually responsible for overseeing public policies and reforms. Creating Independent Regulatory Agencies As earlier observed, a major component of or outcome of regulatory policy reform is the creation of regulatory agencies, agencies that ex perienced exponential growth that the ITU noted 93 Folu Ogundimu and Okechukwu C. Iheduru, Developments in Transporta tion and Communications, in AFRO OPTIMISM: PERSPECTIVES ON AFRICAS ADVANCES 110 (Ebere Onwudiwe and Minabere Ibelema, eds., 2002). 94 ,Id at 118.
31 rose from merely 12 in 1990 to 140 by the year 2005.95 These agencies are typically the mechanism responsible for monitoring and pr omoting compliance with the regulations.96 Many benefits of telecommunications reform are said to be related to the establishment of an independent regulatory agency as shown by Scott Wallsten.97 Wallsten, usin g panel data covering 200 countries from 1985-1999, found that the creation of a regulatory agency before privatizing a nations telecommunications sector correlates not only with improved telecommunications investment but also with telephone penetration (emphasis original).98 Perhaps, these and other imperatives of regul atory reforms is what necessitated the ITU, as the paramount telecommuni cations regulatory body in the world, to convene a Study Group99 that produced a set of best practices guidelines for countries in transition to more liberalized telecommunications markets to estab lish their independent regulators.100 The Study Group, based on a consensus around the de finition contained in the WTO Regulation Reference Paper,101 observed that an independent regulatory agency is separate from, and not accountable to, any supplier of basi c telecommunications services. The de cisions of and procedures used by regulators shall be impartial with re spect to all market participants.102 However, the report 95 INTERNATIONAL TELECOMMUNICATIONS UNION, TRENDS IN TELECOMMUNICATION REFORM 17 (2006). 96 ROBERT BALDWIN, COLIN SCOTT, AND CHRISTOPHER HOOD, Introduction, in A READER ON REGULATION 3 (Robert Baldwin, Colin Scott, and Christopher Hood eds., 1998). 97 Scott J. Wallsten, Does Sequencing Matter? Regulation and Privatization in Telecommunications Reforms 2 (World Bank Policy Research Working Paper No. 2817, 2002). Available online at: http://econ.worldbank.org/resource.php?type=5 ). 98 Id 99 INTERNATIONAL TELECOMMUNICATIONS UNION, TELECOMMUNICATION DEVELOPMENT BUREAU ITU-D STUDY GROUPS. STUDY GROUP 1: QUESTION/1: ESTABLISHMENT OF AN INDEPENDENT REGULATORY BODY 2 (2001) (hereafter ITU Report). 100 Id 101 See WORLD TRADE ORGANIZATION, ANNEX TO THE FOURTH PROTOCOL TO THE GATS AGREEMENT, THE AGREEMENT ON BASIC TELECOMMUNICATIONS NEGOTIATED UNDER THE AUSPICES OF THE WTO IN FEBRUARY 1997 AND BECAME EFFECTIVE 1 JANUARY 1998 (cited in ITU Report, note i). 102 ITU Report 2.
32 observed that there can be no detaile d definition that will be applicab le to all countries due to the differences in legal and political systems and the level of telecommunications development. Therefore, in order to facilitate the de velopment of the best practice guidelines,103 the report adopted a working guideline from The McKinsey Quarterly ,104 which noted that Where a regulator exists, it is important to ensure clarity of jurisdiction and defined resolution mechanisms, adequate organizational competence and funding, and political insulation. Independence derives more from this latter factor than from any formal definition, and manifests itself in regulators power to dissent.105 Consequently, as part of the best practices, the report recommended a number of guidelines for nations wishing to create an independent regulat ory agency. These suggestions included that the mandate of a regulator should be clearly spelled out in national laws;106 the regulatory agency should be structur ally separated from the Ministry;107 the head of the regulatory body should enjoy guaranteed term of office;108 and other members of the regulatory body be appointed in staggered fixed terms.109 The Report also contained recommendations on financing the regulatory agency; adherence to tr ansparent principles of decision making that enhances public tr ust and confidence;110 and the process for over turning agency action. 103 Id 104 Scott Beardsley and Michael Patsalos-Fox, Getting Telecoms Privatization Right 1, THE MCKINSEY QUARTERLY 3-26 (1995) ( cited in ITU Report, note ii). 105 Id 106 ITU Report 3. 107 Id at 8. 108 Id 109 Id 110 Id at 16.
33 Research Questions Based upon the literature disc ussed above, this dissertation will attempt to answer the following questions: What specific communication regulatory reform s occurred during 1994-2004 in Nigeria? What were the outcomes of these reforms on Nigerias communications sector? How may Nigerian communications regulat ory reform be explained by Horwitzs theories of communication regulation? How do these theories of regulation shed light on the policy process involved in deregulating the Nigerian communications sector? Because policy making in developing countries like Nigeria is influenced by international actors but nation states remain the engine room for communication policies, which international factors influenced Nigeria s communication deregulation and how did Nigerias national interests moderate those international influences? What is the nature of the regulatory agencies created in the pr ocess of deregulating Nigerias communications sector? Specifically to what extent are the NCC and NBC independent regulatory agencies based on the ITUs best practices guidelines? Methodology Legislation is usually the origin s of regulatory policies because it is in them that policy goals are defined in the broadest possible term s.111 Consequently, an examination of regulatory policy necessitates both legal a nd policy research. Legal resear ch has been defined as the process of locating the law that governs an indivi dual and institutional activity and materials that explain or analyze the law.112 On the other hand, policy research involves either selectively pulling together and synthesizing theoretical literature, data, and existing research findings from a variety of sources in support of an argument or thesis, or, in contrast, empirically collecting and analyzing original (statistic al) data to support a thesis.113 And communication policy 111 MARC ALLEN EISNER, REGULATORY POLITICS IN TRANSITION 15 (2000). 112 KYO HO YOUM, Legal Methods in the Hist ory of Electronic Media, in METHODS OF HISTORICAL ANALYSIS IN ELECTRONIC MEDIA 125 (Donald G. Godfrey, ed., 2006). 113 MAJCHRZAK, METHODS FOR POLICY RESEARCH, supra note 32 at 58.
34 research is that which seeks to examine the ways in which policies in the field of communication are generated and implemented, as we ll as their repercussions or implications for the field of communication as a whole.114 In view of the above definitions, it may be deduced that triangulati on is the best way to conduct this study. This means seeking information or gathering data by various means such as interviews, observations, and examination of do cuments and archival materials. The legal documents to be examined include both primar y and secondary materials. Primary materials, which are sometimes described as the law, comprise the major sources of law, i.e. constitutional, statutory, judici al, and administrative regulation. It should be noted that primary authority emanates from legislative, judici al, and administrative bodies acting in their lawmaking capacity,115 therefore other materials (such as research studies) commissioned by such bodies not in their lawmaking capacity does not constitute the law and therefore not primary material.116 The secondary materials are those t hat are used to explain, interpret, develop, locate, or update primary sources.117 Consequently, books, research publications in academic and legal journals, conference papers, pr ess and broadcast materials are regarded as secondary materials.118 The importance of primary materials is their authoritativeness, the 114 ANDERS HANSEN, S. COTTLE, R. NEGRINE, AND C. NEWBOLD, MASS COMMUNICATION RESEARCH METHODS 67 (1998). 115 CHRISTINA L. KUNZ, DEBORAH A. SCHEMEDEMEN, MATTHEW P. DOWNS, AND ANN L. BATESON, THE PROCESS OF LEGAL RESEARCH 11 (2000). 116 Id at 12. 117 ROY M. MERSKY AND DONALD J. DUNN, FUNDAMENTALS OF LEGAL RESEARCH 10 (2002). 118 KYO HO YOUM, Legal Methods in the Hist ory of Electronic Media, in METHODS OF HISTORICAL ANALYSIS IN ELECTRONIC MEDIA, supra note 112 at 124.
35 imperative of secondary sources is explaining an d analyzing the law and placing it in context thereby making the sometimes arcane law comprehendible.119 Electronic and online resources in form of databases (such as LexisNexis and Westlaw) and the Internet (websites of NBC and NCC) were useful in locating primary and secondary120 materials ranging from regulations enacted by the ag encies and agencies hi story and structure to open access journals and news reports about th e activities of the agencies. Fortunately, LexisNexis currently carries reports of two major Nigerian newspapers as well feeds from BBC Global Media Monitoring Reports which in cludes reports from Nigerian media. The legal research was accomplished in part by using LexisNexis and selecting Terms and Connectors. The four search terms used in cluded broadcast w/p regulation; broadcast w/p deregulation; telecommunications w/p deregul ation; telecommunications w/p regulation. The following segments of Lexi sNexis were searched: 1. Legal > Cases U.S. > U.S. Supreme Cour t Cases, Lawyers' EditionU.S. Supreme Court Cases, Lawyers' Edition 2. Under Secondary Legal > US & Canadian Law Reviews, Combined 3. Federal Legal U.S. > Administrative Ag ency Materials > Federal Agency Decisions, Combined The need for obtaining these US primary and seconda ry materials is in order to incorporate them into the broader theoretical analysis of the justifications for communications regulation and to use them in illustrating the explanations of the regulatory theories outlined by Horwitz. For secondary communication policy and re gulation research beyond law reviews and periodicals available in Lexis-Nexis, two da tabases, ComAbstracts and Communications & Mass Media Complete, provided the bulk of literature examined. The following key terms were used 119 Id 120 Id at 136.
36 separately to search the two databases: Nigeria, communications policy, communications regulation, and communications deregulation. To find Nigerian communicati on regulations and policies, th e websites of Nigerias two communication regulatory agencies were used to retrieve primary legal and regulatory documents. Already the basic primary material s (Nigerian constitution, laws establishing the agencies, National Mass Communi cation Policy, and National Te lecommunication Policy) had been obtained during a trip to Nigeria last summ er. In addition to these sources, research commissioned by the agencies, press releases of the agencies, memoranda, and legislative documents (hearings) have also been consulted. An Outline of the Rest of the Dissertation In terms of organization, chapter II of th is study examined the theoretical literature regarding the broad social and economic justifications for communicatio ns regulation and for factors that influence regulation and deregulatio n. The chapter also examined the process of policy reform in developing c ountries like Nigeria and the best practices for establishing independent regulatory agencies. Chapter three of the study examined the transformation of telecommunications and broadcasting regulati on in Nigeria from re stricted government monopoly to the beginning of deregulation and ma rket competition. The chapter then surveyed the history of telephony and broadcasting in Nigeria, the incremental reforms in the communications sector beginning with partia l commercialization in the 1980s to the implementation of the Structural Adjust ment Program and the debate on national communications policy. The chapter concluded by discussing the commencement of the deregulation of communications sector and the establishment of the two regulatory agencies. Building upon the history of Nigerian communica tions regulation, chapte r four discussed the legal instruments establishi ng the NCC and NBC and their organizational structure and
37 operational processes. In addition, the fourth chapter also examin ed the National Mass Communication Policy and the National Teleco mmunications Policy which were adopted in 1990 and 2000 and discussed how th ese policies influenced legislation on the NBC and NCC respectively. Chapter five provi ded an overall assessment of th e current communications sector in Nigeria, describing the changes in market st ructures and providers of both broadcasting and telecommunications since the reforms of the early 1990s and also highlight ed how the changes in the communications sector have affected the pub lic in terms of widening the avenue for freedom of freedom of expression and the availability and the use of varied communication services. Finally, this chapter attempted to answer th e research questions and then concluded by describing the challenges that the NBC and NCC currently face in regulating Nigerian communications sector in order to achieve polices aimed at making services more widely available to the citizenry. Chapter six will summ arized the findings of the dissertation and suggested possible regulatory policy reforms for both the broadcasting and telecommunications sector. Finally, the chapter will conclude by id entifying and suggesting and areas for further inquiry. Justification/Significance a nd Limitations o f the Study A search of ComAbstracts database with N igeria as keyword pulled only 40 items out of which only about six were on communications regulatio n in Nigeria. Of these six articles, only two articles were written post-deregulati on. A similar search of Communications & Mass Media complete database pulled 32 items of which only seven were on communication law, policy or regulation in Nigeria. Of these seven, the same previous tw o articles involved postderegulation. A search on dissertation abst racts turned up only one study that examined broadcasting policy and another that looked at the state of Nigeri as telecommunications services; both studies were co mpleted prior to the deregulati on of the communications sector.
38 This clearly indicates a paucity of literature on communications deregulat ion in Nigeria, which confirms the argument about paucity of literature on low income countries in general because there is bias in the li terature that favors the study of larg e markets in high income countries.121 Secondly, this study, by applying regulation theo ries developed in the West to examine the Nigerian context, adds the value that compar ative research brings, i. e. proving how selected phenomena compare and contrast in different countries.122 Other importance derived from the comparative research are said to include incr easing to the universal data on the phenomena examined123 and highlighting the naivet y and parochialism of a ssuming that theories and findings from one society are ap plicable in other societies.124 Finally, the imperative of comparative research especially to communicati on policy is heightened by globalization that has not only increased the flow of information that influences po licy-making but has also seen attempts to deploy policy experience in one coun try in the service of policy formulations in others.125 Thus, according to Blumler and Gurevitch,126 efforts to profile the incidence of policy problems across national communication syst ems, and the manner in which they have been tackled, could constitute genuine contribution by the research co mmunity to policy-making 121 Irene Wu, Roxanne McElvane, Anita Dey, and Kiran Duwadi, Current international issues in communications regulation: refining regulatory techniques, impact of wireless' popularity on regulation, and the growing significance of cable television 3. Paper presented at TPRC Conference, September 19-21, 2003, Arlington, VA. Available online at: http://www.tprc.org/papers /2003/197/WuMcDeyDu2.pdf (Last accessed December 22, 2006). 122 JAY G. BLUMLER AND MICHAEL GUREVITCH, THE CRISIS OF PUBL IC COMMUNICATION 73 (1995). 123 Id. at 75. 124 Id at 75-76. 125Id at 79. 126 Id
39 process in different societies. Researchers w ith a comparative bent of mind seem uniquely qualified to perform such service.127 Thirdly, like most American studies of co mmunication regulation which focus on either telecommunications or br oadcasting but not both,128 the scant literature on Nigerias communication regulation either focus on teleco mmunications or broadcasting. The imperative of convergence in communications systems necessi tates examining the two concurrently, which is what this study intends to do. Moreover, and fourthly, none of the extant studies identified examined Nigerias regulatory policies from the prism of the competing theories of regulation outlined by Horwitz or the various theories of pub lic policy in developing countries discussed by Grindle and Thomas. Fifth, as models for cultura l and social regulation of media vary from one nation to another, highlighting th e different models will help increase knowledge about such regulatory policies, enhance generalizability, and facilitate organizational learning in this case other agencies may learn from the Nigerian experience.129 Finally, this study hopes to contribute to the evaluation of Nigerias National Tele communications Policy and therefore assist policymakers in line with the policys provision that [t]he policy shall be reviewed from time to time by government to take cognizance of changes in standards, technologies, markets, and any other matters that may arise from its implementation.130 While the significance of this study are numer ous as outlined above, the dissertation is not without its limitations. Although an IRB approval to interv iew policy actors and observe 127 Id 128 HORWITZ, THE IRONY OF REGULATORY REFORM supra note 31 at 8. 129 BEN GOLDSMITH, ET AL. Cultural and Social Regulatory Principles in Converging Media Systems, in GLOBAL MEDIA POLICY IN THE NEW MILLENNIUM supra note 76 at 103. 130 FEDERAL REPUBLIC OF NIGERIA, NATIONAL TELECOMMUNICATIONS POLICY 68 (2000). Available online at www.ncc.gov.ng (Last accessed December 12, 2006).
40 proceedings of the commissions, a general, nation-wide strike in Nigeria during the summer of 2007 made it impossible to either interview the policy actors or attend proceedings of the commissions. Therefore, one of the major limita tions of the study is the inability to employ interviews and observations in the data gathering process. Interviews with regulators and other policy actors would have illuminated some of the major constraints encountered by the former and th e perception of the latter regarding regulatory policies. Similarly, an opportunity to observe pu blic hearings by the agencies and compare the public submissions with the policy outcome on that issue would have highlighted the extent to which public input is taken into cognizance by agencies in their rulemaking. Attending and observing Consumer Parliament, a forum innovated by the NCC that brings together subscribers and providers for discussion of consumer concerns, would have added to the understanding of the major complaints by the subscribers and the service providers respon ses to such concerns. Similarly, attending a broadcast license renewal hearing by the NBC would have provided an opportunity to grasp the audience needs and gauge whether the broadcasters are meeting such needs or not. Needless to say, all thes e limitations merit further study.
41 CHAPTER 2 LITERATURE REVIEW In this chapter, the d issertation will examine the broad theoretical literature regarding the social and economic justifications for public policy and regulation and, in particular, the literature on communications regulation and polic y with emphasis on factors that influence regulation and deregulation. The chapter will also examine the literature on regulatory agencies with an emphasis on communicatio n regulatory agencies and concl ude by highlighting the best practices for establishing independent communication regulatory agencies. In chapter one the study highlighted and di scussed five major theories identified by Robert Horwitz to explain communication regulatory policies. As will be shown subsequently, the theories outlined by Horwitz were largely deri ved from the broader social science literature, especially economics, political science and public po licy. It must be noted that as recently as the early 1990s, regulation meant different thi ngs in Europe and the United States.1 In Europe, regulation is broadly viewed to include leg islation, governance, and social control, and therefore not a distinct kind of policy-making.2 In contrast, in the United States regulation contains a more specific meaning because the term is used to refer to sustained and focused control exercised by a public agency over activities that are generally regarded as desirable to society.3 Therefore, in the American context, regulat ion requires more than just passing laws,4 1 Giandomenico Majone, Introduction, in DEREGULATION OR RE-REGULATION? REGULATORY REFORM IN EUROPE AND THE UNITED STATES 1 (Giandomenico Majone, ed., 1990). 2 Id. at 1. 3 Id. at 2. 4 Id ., citing Landis 1966: 25-6 as saying the art of regu lating an industry requires knowledge of details of its operations, ability to shift requirements as the condition of the industry may dictate, the pursuit of energetic measures upon the appearance of an emergency, and the power through enforcement to realize conclusions as to policy.
42 and regulatory policy-making requires, not bureaucra tic generalists, but sp ecialized agencies or commissioners capable of fact-fi nding, rule-making, and enforcement.5 This study, for the most part, adopts the view of regulation as perceived in the American context taking into account that even within th e United States, speciali zed regulatory agencies are sometimes charged with initia ting and or implementing policies. Theoretical Justifications for Regulation and Public Policy The diversity of regulatory policies m akes it im possible to have a single explanation of why governments regulate;6 each rationale adduced provides so me insights regarding the vision and expectation of a regulatory policy without nece ssarily fully explaining the rationale for such policy.7 However, several authors identified expl anations for government regulations and policies. Among these authors are Marc Eisner, Jeff Worsham, and Evan Ringquist, who provide three theories justifying regulatory policies. Fi rst, regulation is aime d at furthering public interest. The public interest theo ry, which is viewed as the ol dest and perhaps the most obvious theory of regulation,8 claims that the primary goal of regul ation and regulatory activity is the protection of public from potentia l abuses in the marketplace, especially abuses by monopoly power resulting from high costs of entry by ot her competitors and the economy of scale and scope. This (public interest) th eory is also referred to as consumer protection theory.9 While acknowledging that the concept of public interest is amorphous, Ei sner, et al., noted that the 5 Id. at 2. 6 MARC ALLEN EISNER, JEFF WORSHAM, AND EVAN J. RINGQUIST, CONTEMPORARY REGULATORY POLICY 3 (SECOND EDITION, 2006). 7 Id. at 3. 8 CHRISTOPHER H. STERLING, PHYLLIS W. BERNT, AND MARTIN B. H. WEISS. SHAPING AMERICAN TELECOMMUNICATIONS: A HISTORY OF TECHNOLOGY, POLICY, AND ECONOMICS 27 (2006). 9 Id at 28.
43 concept has judicial backing based on th e U.S. Supreme Courts determination in Munn v. Illinois,10 specifically because when business is affect ed with a public interest, it ceases to be juris privati only.11 Second, regulation is necessary to prevent and or compensate for market failure.12 Market failure refers to a circumstance in which the pu rsuit of private interest does not lead to an efficient use of societys resources or a fair distribution of societys goods.13 Market failure may arise from a number of factors, includi ng natural monopoly nonexludable and nonrivalrous public goods, externalities resulting from costs and benefits of the transac tions to third parties, lack of complete information resulting in in formation asymmetry, and transaction costs which are the costs of the processes, mainte nance and enforcement of transactions.14 In a similar vein, then Harvard law prof essor Stephen Breyer observed that this commonly cited justification for regulation assumes that an unre gulated market is the norm, therefore regulation is needed to the extent necessary for overcoming one or more market defects that might otherwise prevent purely free markets from serving the public interest.15 Breyer classified the justificat ions for regulation as the need for the following: (i) controlling 10 94 U.S. 113 (1876). (the Court, citing England s 17th century Lord Chief Justice Hales treatise De Portibus Maris, 1 Harg.Law Tracts 78, further held that private property does become clothed with a public interest when used in a manner to make it of public consequence an d affect the community at la rge. When, therefore, one devotes his property to a use in which the public has an inte rest, he, in effect, grants to the public an interest in that use, and must submit to be controlled by the public for the common good, to the extent of the interest he has thus created. Id.). 11 Munn v. Illinois, at 94. 12 EISNER, at al., CONTEMPORARY REGULATORY POLICY, supra note 6, at 7. 13 DAVID L. WEIMER AND AIDAN R. VINING, POLICY ANALYSIS: CONCEPTS AND PRACTICE 37. 14 EISNER, at al., CONTEMPORARY REGULATORY POLICY, supra note 6. 15 Stephen Breyer, Regulation and Deregulation in the United States: Airlines, Telecommunications and Antitrust, in DEREGULATION OR RE-REGULATION? REGULATORY REFORM IN EUROPE AND THE UNITED STATES 9 (Giandomenico Majone, ed., 1990).
44 (natural) monopoly power; (ii) controlling windfall pr ofits arising from neither skill nor talent of producer;16 (iii) correcting for spillover costs externality; (iv) compensating for inadequate information especially lowering the cost/time of obtaining relevant inform ation; (v) eliminating excessive competition that sometimes lead to preda tory pricing; and (iv) alleviation of scarcity especially in the case of broadcast licenses.17 Third, regulation (in the Unite d States) is the outcome of regional interests vying for economic benefits. In other words, regulatory initiatives reveal how the industrial core and the industrial periphery are seeking to prevent and ensure the shift of economic benefits from and to their areas respectively.18 Finally, another justification for regulatory policy is explained by what Sterling called equity-stability theory.19 There are two approaches to this theory view: one c ontends that the legislators action of creating regulatory agencies is informed by the desire to further social equity and fairness while the other view argues that the legislators goal is the need to control the excesses of capitalism in order to ensure the systems continuity.20 The former approach contends that left to the unimpe ded market forces, societys re sources would not be distributed in a socially equitable manner; the role of regulation is to act as a corrective.21 The latter approach, derived from capitalist st ate theory, noted that certain in abilities and limitations of the 16 Id. at 10. 17 Id. at 11. 18 EISNER, at al., CONTEMPORARY REGULATORY POLICY, supra note 6, at 10. 19 STERLING, et al., supra note 8, at 29. 20 Id at 29. 21 Id
45 marketplace and market forces necessitate the regu lation of potentially self-destructive capitalist behavior.22 Contrary to the preceding theories advanced fo r the justifications of regulation and public policies, critics of regulation pos it that two other theories may also explain regulation and public policies, i.e. interest groups theory and capture theory. The first contrarian theory contends that regulation is the result of car tels and interest groups de mands pushed through effectively organized political coalitions.23 According to Sterling, Bernt, and Weiss, this is referred to as Private interest or Interest Group theory.24 The theory focuses on why regulators action fail to serve the public interest or what regulators actually do as ag ainst what they ought to do or were established to do. The theorys conclusion is that regulation is used by in dividuals and groups to serve private interests. These individuals and groups include stockholders, managers of companies, regulators and intervenors in the re gulatory proceedings resulting in coalition and consensus built and reached by regulators as medi ator thereby enabling the regulator to access political power for his/her own interests.25 A variant of this theory is dubbed coalition-building theory.26 The second contrarian theory argues that regulatory ag encies are captured by the concerned industry after the agencies initial ac tive regulatory period as the agencies become matured and align themselves more with the re gulated industrys conc erns, rather than the 22 Id 23 EISNER, at al., CONTEMPORARY REGULATORY POLICY, supra note 6 at 8. (in further analysis, however, the authors observed that the deregulation of th e last two decades seems to underm ine this economic regulation theory. Id .). 24 STERLING, et al., supra note 8, at 28. 25 Id. 26 See Harry Trebing, Equity, Efficiency, and the Viability of Public Utility Regulation, in APPLICATIONS OF ECONOMIC PRINCIPLES IN PUBLIC UTILITY INDUSTRIES (Werner Sichel & Thomas Gies eds., 1981).
46 interest of the general public.27 It is argued that the revol ving door trend resulting from movement of regulators into industry jobs a nd vice-versa as well as the stronger industry lobbying compared with consumer in terests, ensures that regulators will not act in ways that will be harmful to the regulated industrys interests.28 In other words, the re gulatory agency not only identifies with, but serves the interest of the industry rather than the publics. Consequently, not only is the government authority used to help the regulated industry, the industrys representatives play a central role in drafti ng regulatory legislation.29 It is therefore the conclusion of this theory that [t]he use of regulation to protect the industry reflects the contention that advanced capitalism requires a far greater integration of the state and the economy than is often supposed by free-market advocates.30 However, it has been observed that regulatory capture is seemingly increasingly difficult in the face of multiple advocacy groups and expanded access to courts. Therefore, the industr ies new tactic is to embroil agencies in lengthy appeals, and force regulators to jus tify their decisions us ing market criteria.31 While the above theories are advanced to e xplain regulatory policy in general, it may be appropriate to examine the theoretical justificat ions for communication regulation in particular. Scholars have explained how the preceding th eories may be applicable to explaining communication regulation policy by arguing that public interest theory has implication for the economic and political role of communication in a democratic society a nd by showing the actual and potential consequences of market failure in communication industry especially with regards 27 EISNER, at al., CONTEMPORARY REGULATORY POLICY, supra note 6 at 10. 28 STERLING, et al., supra note 8 at 28-29. 29 EISNER, at al., CONTEMPORARY REGULATORY POLICY, supra note 6 at 10. 30 Id. at 10. 31 Id
47 to externalities of telecommuni cation networks and broadcasting and the nature of broadcasting and telecommunications as public goods and natural monopoly respectively. Thus, the next subsection will focus on justificat ions for communication regulation. Communications Regulation In viewing the rem edying of market failure as the primary rationale for regulatory policy, John Kay and John Vickers identified network externalities as the be nefits of the network effects to a subscriber that depends upon who else subscribes to the same network.32 In other words, the larger the network, the greater the benefits to subscribers. Therefore, network externalities are advanced as regulatory justif ication for requiring equal and non discriminatory interconnection by all service providers.33 Further, the externalities also provide rationale for designating telecommunication se rvice providers as common carriers upon who have been conferred certain rights and oblig ations including providing service at just and reasonable rate without unreasonable discrimination.34 In telecommunications, common carriers are those engaged in wire or radio transmission of energy for hire with the exception of those engaged in radio broadcasting.35 In return for that obligation, the common carriers are exempted from liability for the content of the messages they transmit.36 The same network externalities have been advanced as the rationale for providing cros s-subsidization where profit from one part of 32 John Kay and John Vickers, Regulatory Reform: An Appraisal in DEREGULATION OR RE-REGULATION? REGULATORY REFORM IN EUROPE AND THE UNITED STATES 226 (Giandomenico Majone, ed., 1990). 33 See e.g. 47 U.S.C. 251 which provides inter alia that a telecommunications carri er has the duty (1) to interconnect directly or indirectly with the facilities a nd equipment of other telecommunications carriers; and (2) not to install network features, functions, or capabilities th at do not comply with the guidelines and standards established pursuant to section 255 or 256 of this title. 34 See 47 USC 153(10). 35 Id 36 STERLING, et al., supra note 8, at 21.
48 the business (usually high-profit commercial entiti es) is applied to reduc e the cost of providing service to non-commercial subscribers; this lead s to and justifies unive rsal service provision.37 Further, the universal service prov ision results in externalities in terms of the emergency services that telephony may be utilized; the emergency service is also vi ewed as public goods that the market typically fails to provide.38 Another justification for regulation of telecommunications, especially local telecommunication companies, is their status as natural monopoly. According to Sterling, who drew analogy from the holding in Munn v. Illinois, telecommunication co mpanies are not only capital intensive networks that are engineered to accommodate peak demand, they also provide essential services rather than goods in a monopo lized fashion and are th erefore regarded as a public utility thus subject to regulation.39 Further, in order to construct their networks, telecommunication service provide rs are granted not only the use of public right of way, but sometimes private property is taken through the eminent domain and granted to them.40 Finally, a major justification for the regulati on of telecommunications is the notion that telecommunications constitute part of the infrastructure or channels for both discourse and commerce the major lubricants for the poli tical and economic engines of a democratic society.41 Thus, the imperative of telecommunications goes beyond the private interest of profit making or socialization to the r ealm of common good otherwise techni cally referred to as public 37 Kay and Vickers, Regulatory Reform, supra note 32, at 226. 38 Id 39 STERLING, et al., supra note 8, at 22. 40 ROBERT B. HORWITZ, THE IRONY OF REGULATORY REFORM: THE DEREGULATION OF AMERICAN TELECOMMUNICATIONS 13 (1989). 41 Id at 11.
49 interest.42 This status of telecommunications as se rvice of public intere st necessitates its designation as an economic infras tructure that is subject to government intervention through construction, maintenance, promotion, subs idy, or protection through the granting of monopoly.43 The often stated justifications for broadcast regulation span technological, socio-political, and economic factors, that include spectrum scarcity, democr acy, freedom of speech, and marketplace failure. To further explicate this, first take the case of spectrum scarcity. The justification and or theo rizing about broadcast regulation stem s from what is generally termed the scarcity rationale. This is the understanding that the electromagnetic spectrum on which broadcast signals are transmitted is a limited resource that cannot accommodate all those who may be interested in broadcasting. As a resu lt, this limitation necessitates governments intervention and organization of the a llocation, management, and other general technical/engineering issues related to the admini stration of the radio sp ectrum. Since electronic broadcasting is only possible through transmission of signals via spectrum and since that spectrum cannot be available to all who desire to have it, it logically foll ows that those who have been granted its use serve as trustees of the public.44 The scarcity rationale has been repeatedly upheld by the courts (including the U.S. Suprem e Court) as justification for governments 42 Id at 12. 43 Id 44 See generally Red Lion Broadcasting Co. v. FCC, 395 U.S. 367, 397 (1969); See also PATRICIA AUFDERHEIDE, COMMUNICATIONS POLICY AND THE PUBLIC INTEREST: THE TELECOMMUNICATIONS ACT OF 1996 (1999).
50 regulation of broadcasting. Perhaps the mo st notable cases in this regard are Red Lion v. FCC,45 and most recently, the Prometheus Radio v. FCC .46 A second theoretical justifica tion for the regulation of broadcasting is the notion of deliberative democracy that can be foster ed through the public in terest obligation of broadcasting, especially as manifested in certa in regulatory enactments such as the reasonable access and equal opportunities rule. In a democra tic system of government, public participation in what is termed self-govern ance, requires among other things, freedom of speech and the right to receive and impart information. It naturally fo llows that since broadcasting serves as one of the principal avenue for such participation in public discourse it should not be monopolized.47 Among the scholars who analyzed broadcast po licy taking into account the above factors is Philip Napoli.48 Specifically, he cites three factors that he regards as the fundamental difference between communications regulation and the regulation of other industries.49 First, he notes that policy decisions rega rding broadcasting have socio-po litical implications because information flow is fundamental to the formation of the social and poli tical views that guide political behavior.50 He explained this by citing research on agenda-setting and the influence of media on the political process in general. Sec ondly, unlike other industr ies whose activities largely concern the economy only, broadcast regula tion concern social and political issues such 45 395 U.S. 367. 46 373 F.3d 372 (3rd Cir. 2004). 47 Red Lion, 395 U.S. at 388. For a thorough explication of the linkage between broadcasting and democracy, See generally, C. EDWIN BAKER, MEDIA, MARKETS, AND DEMOCRACY (2002). 48 PHILIP M. NAPOLI, FOUNDATIONS OF COMMUNICATIONS POLICY: PRINCIPLES AND PROCESS IN THE REGULATION OF ELECTRONIC MEDIA (2001); & Philip M. Napoli, The Unique Nature of Communications Regulation: Evidence and Implications for Communications Policy Analysis 43 J. OF BROADCASTING & ELECTRONIC MEDIA 565 (1999). 49 Napoli, The Unique Nature of Communications Regulation, Id at 565. 50 Id. at 566.
51 as reasonable and equal access for political can didates, indecency, and childrens programming. Thirdly, even the regulation of the economics of communication such as cable rate regulation, while protecting the consumer s from possible exploitation by a natural monopoly or an oligopoly, such polices inadvertently enhance in formation flow to low income earners. These three factors help inform the underlying philo sophy for regulating communications serving the public interest.51 Although, according to Cass Suns tein, there is a large diffe rence between the public interest and what interests the public,52 central to the goals of broadcasting should be the promotion of American aspiration to deliberativ e democracy, a system in which citizens are informed about public issues and able to make judgments on the basis of reasons.53 Therefore, communication policy is not only about market economics; rather it is more about the marketplace of ideas54 and the effects on the public sphere.55 In furtherance of the medias role as the most potent public sphere, therefore, access must be created, if not for all, at least for discussions that are germane to the public inte rest and democracy. Also, because of the power inherent in broadcasting, ownershi p must be limited. If structural limits are not imposed we may have a situation where, as A. J. Libeling stated, Freedom of the press is guaranteed only to those who own one.56 51 See generally NAPOLI, FOUNDATIONS OF COMMUNICATIONS POLICY, supra note 48. 52 Cass Sunstein, Television and the Public Interest 88 CALIF. L. REV. 499, 501 (2000). 53 Id. 54 See Marc Sophos, Comment, The Public Interest, Convenience, or N ecessity: A Dead Standard in the Era of Broadcast Deregulation? 10 PACE L. REV. 661 (1990). 55 Sunstein, Television and the Public Interest, supra note 52 at 504. 56 A. J. LIEBLING, THE PRESS, 30-31 (1964).
52 Broadcast regulation is also explained or just ified because of externalities, that is the tendency of the consequences of the actions of two parties to rub-off beyond them, in other words, the positive and negative effects on third parties.57 The externalities, as earlier explained, are a reflection of the proba bilities of market failure, in this case, it is the inability of the commercial broadcasters to produce what the audience needs,58 partly because broadcasters regard the audience more like produ cts being offered to advertisers than consumers paying for entertainment on their own.59 Therefore, the commercial media tend to favor blockbuster [entertainment] products over more diverse and small media products that people often want, often neglecting in formation that citizens may need to make informed political decisions about politics and public policy. Cons equently, market processes produce excessive amounts of media products with negative externalitie s and insufficient amounts of those with positive externalities.60 Unlike the preceding scholars that seek to justify regulatory intervention, there are scholars who believe in the preeminence of free ma rket and theorized that broadcast regulation is unjustifiable, especially with regards to new communication technol ogies and the First Amendment.61 One such scholar is Ithiel de Sola Pool who examined broadcast regulation in his book, Technologies of Freedom In his analysis of the emergence of electronic communications using wires, radio waves, satellites, and computers, Pool conc eded that initially regulation 57 C. Edwin Baker, Giving the Audience What It Wants, 58 OHIO ST. L.J. 311, 316 (1997). 58 Id. 59 Sunstein, Television and the Public Interest, supra note 52 at 506. 60 BAKER, ADVERTISING AND A DEMOCRATIC PRESS, supra note 47, at 96. 61 For attacks on broadcast regulation, see e.g. LUCAS A. POWE & THOMAS KRATTENMAKER, REGULATING BROADCAST PROGRAMMING (1994); and LUCAS POWE, AMERICAN BROADCASTING AND THE FIRST AMENDMENT (1987).
53 seemed to be a technical necessity, but observe d that as speech incr easingly flows over those electronic media, the five-century growth of an unabridged right of citizens to without controls may be endangered.62 He observed that although in prin ciple, communications law in the United States guaranteed freedom of expression in the First Amendment, in reality it is a trifurcated communications system63 where print, common carrier s, and broadcasters are treated separately. Pool observed that the Fi rst Amendment truly govern s the print media while common carriers are obligated to serve all on equa l terms without discrimination; but broadcasters are selected by government and high ly regulated on the basi s of supposed scarcity of usable frequencies in the radio spectrum.64 He then raised questions about what will happen in the unfolding convergence of these difference modes. Will convergence upset the trifurcated system and lead to more regulation of the print media when it uses the wired computer networks to deliver text? Conversely, will convergence help to free the re gulated electronic media due to concerns for traditional freedom the press? Pool cam e down heavily in favor of the latter, that is freeing the regulated electronic communication, because he believes freedom is fostered when the means of communication are disperse d, decentralized, and easily available.65 Pool further argued that the initial regulati on of broadcasting that was based on the notion of spectrum scarcity failed to anticipate the possib ility of future solutions. He also contends that the acceptance of government to be the licensor and regulator is in consistent with the traditional notion of the freedom of the press because it supposes that government will play a positive role 62 ITHIEL DE SOLA POOL TECHNOLOGIES OF FREEDOM 1 (1983). 63 Id at 2. 64 Id. 65 Id at 5.
54 on behalf of citizens freedom a nd that, to him, is unpersuasive.66 He therefore suggested the use of market forces for the distribution of spectrum rather than government allocation, which he claims is made to political favorites and often end up being bought and sold in second-hand markets.67 He outlined three reasons why the market is better: 1) it will bring proceed to the government rather than few individuals; 2) it will reduce demand for spectrum and ensure judicious use of the available spectrum; and 3) the market will ensure insulation of licensing from government and therefore gives licensees polit ical freedom. Pool conceded that due to other uses for which spectrum is utilized, such as av iation, the government may continue to allocate the bulk of spectrum for purposes in the same wa y that a city zones property for residential, commercial and other uses. Finally, Pool wondered why the broadcast medi a is obligated with balancing viewpoints in the name of limited spectrum when even news papers are becoming like common carriers of news. He then observed that the be st policy is to allow broadcaste rs to attain freedom much like the newspapers and learn from the newspapers th at the societal expectation on them is to be fair.68 Newspapers, he pointed out, n ot only run columnists of opposite tendency and open their news pages willingly to community groups, but al so encourage letters to the editor. Most important of all, they accept adve rtising from anyone. He critic ized the continued regulation not only because the basis for it is now obsolete due to the prevalence of cable and satellite, but also because of the political selection of broadcaste rs and the regulated regime is carried out by the 66 Id. at 135. 67 Id. at 139. 68 Id. at 238-239.
55 values and judgments of public authorities thereby undermining the tradition of free communication.69 However, Eli Noam, who edited Pools last book (based on the manuscripts Pool left),70 believes Pool was at times ove rly negative about government policy in achieving diversity and in the process failed to be adequately concerned with potential abuses by private power and the realities of market failure. Further, Pools pres cription of eliminating legal barriers, says Noam, may not be adequate to give di verse voices a hearing rather, [a] governmental role in adding to program supply seems therefore legitimate fo r example, through support of the nonexclusive public broadcasting institutions, or of progr ams that would otherwise not be produced.71 Moreover, the need for alternat ive programming is justified by eminent sociologist, Herbert Gans,72 who demonstrated that U.S. media are bias ed not only towards the upper-class over the poor, but they are biased towards what he called core values of American journalism such as ethnocentrism, individualism, re sponsible capitalism, etc. Among the fierce critics of the market approa ch are Edwin Baker and Charles Tillinghast. A University of Pennsylvania professor of law, Edwin Baker, responds to the criticisms of broadcast regulation by free marketers in is his book73 and elsewhere.74 Bakers general premise is that despite the lure of e quating freedom of the press with free markets, constitutional law 69 Id. at 149. 70 The book is titled Technologies Without Boundaries : On telecommunications in a global age (Harvard University Press, 1990). 71 Id at vii viii. 72 HERBERT J. GANS, DECIDING WHATS NEWS 39-52 (1969). 73 Id. 74 See generally C. Edwin Baker, Advertising and a Democratic Press, 140 U. PA. L. REV. 2097 (1992); BAKER, MEDIA, MARKETS, AND DEMOCRACY, supra note 47.
56 does not support such equation.75 Baker observed that those who equate freedom of the press with free markets are usually the proponents of media deregulation who argue that public choice about media content should be left to the market This argument, Baker said, can be countered by the plausible assertion that often the people do not know what they want since the public only receives what the broadcaster chooses to program.76 The assumption of the economics-oriented cr itics of media regul ations, according to Baker, is that in an ideal s ituation, the market encourages pr oduction of items or provision of services as long as the cost of the production w ill be less than the price to be paid by the purchaser, i.e. there will be profit. Baker conced ed that this market model may efficiently be applicable for items such as cars but th e model applies badly to media products.77 This is because in many ways media products are unlike most other products.78 First, media products have the characteristics of what is called public good, that is an item for which one persons use or benefit from the product does not affect its use by or benef it to another person.79 For example, regardless of how many people watch a br oadcast, it would not co st the broadcaster or receiver anything more. Therefore since not all th at partake in accessing the broadcast are willing or able to pay, somebody has to be charged to co ver the marginal costs of the audience who did not pay and that somebody is most li kely going to be an advertiser. Secondly, media products produce many positive a nd negative externalities; that is the benefit or harm that accrues to people who do not participate directly in the transaction. The 75 BAKER, MEDIA, MARKETS, AND DEMOCRACY, supra note 47. 76 Id 77 Id at 7. 78 Id at 8. 79 Id
57 common or rather simple example, according to Baker, is air pollution which affects us all regardless of whether we are part of the transact ion that produced it or not. In the case of the media, if an individual is passionate about well-func tioning democracy and public accountability, she benefits by inve stigative journalism and qualitati ve media reportage of issues such as exposing corporate corruption, whether or not the country should go to war, etc. However, the same person can be harmed by th e ignorance of others or apathy produced by inadequate consumption or consumption of mi sleading, distortive, and demobilizing media.80 The third difference between media and othe r products Baker identified is that media products are often paid for by two purchasers be cause Media enterprise commonly sells media products to audiences and sells audiences to advertisers.81 This situation creates an inherent conflict of interest because what the audience wants may not be what the advertiser wants, thereby creating a divided allegiance by the br oadcaster who has to hover between the two purchasers. But since influence tends to flow towards the larger purchaser,82 Baker concludes that it means the advertiser, who paid more, may influence the programming. Thus, each of the above differences between media and other products has the tendency to lead to results contrary to what th e audience wants what it would pay for.83 For example, Baker observes that unfortunatel y, the influence of advertisers is increasingly resulting in censorship, skewed media content, a nd even impaired media competition.84 Therefore, rather than continue to view government interventions in terms of regulation as the only source for 80 Id at 10-11. 81 Id at 11. 82 Id 83 Id at 14. 84 BAKER, ADVERTISING AND A DEMOCRATIC PRESS, supra note 47, at 83.
58 violation of freedom of the press, Baker noted that private entitie s in general and advertisers in particular constitute the most consistent and most pernicious censors of media content.85 And in the process, they are preventing the media from serving the needs of democratic society.86 Baker cited and detailed numer ous cases of how corporations blocked or threatened to block media contents that they abhor. One such case is Procter & Gambles threat to retaliate against broadcasters criticizi ng its purchase of El-Salvadoria n coffee. The company actually withdrew advertising from a station that refused to heed the warning.87 Baker explained that advertisers expect, or at least want, broadcasters to put the au dience in a specific mood and frame of mind that is receptive to, or would facilitate, advertising.88 Advertisers also avoided programs they regarded as depressing. A typical ex ample of this is Coco-Colas policy not to advertise on TV news because theres going to be some bad news presented and Coke is an upbeat, fun product.89 Baker outlined the dual dangers of advertisers pervasive influence on media to be the reduction of the diversity of the vital information that would be available to the public and the simultaneous slanting of media s coverage in favor of the commercial perspectives.90 Finally, Baker demonstrated the power ful nexus between advertising and disempowerment thus: 85 Id at 3. 86 Id 87 Id at 100. 88 Id at 63. 89 Id at 63. (Citing a vice president of Coca-Cola). 90 Id at 100.
59 If, as studies report, media usage promotes political invo lvement, particularly among those to whose political interests the me dia respond, and if, as economic analysis predicts, advertising leads the media to be or iented toward the more affluent, then the advertising supported media should stimulate po litical participation primarily among the comparatively affluent. Thus, advertisings s ubsidy not only distributes news in an even less egalitarian manner than would a market system where readers pay full costs of the paper, but it also quite likely depresses the comparative political participation of the poor.91 Therefore, it may be concluded th at without some regulation of broadcasting, the same scenario will be replayed in the electronic media. Another critic of market-based broadcast regulation is Charles H. Tillinghast92 who observed that of the three arguments offered ag ainst regulation of, a nd as justification for deregulation of, broadcasting, one is a general argument though a pplicable to broadcasting, while the other two are particular to broadcasting. The general argument is that regulation has been taken over by the regulated entitie s and the only solution to rid regu lation of that cancer will be to root out the regulation.93 The two arguments which are speci fically about broadcasting are, first, that regulation interferes with broadcasters First Amendm ent rights and other rights, most notably property rights. The proponents of this argument view government bureaucracy as rigid and believe an unfettered, free mark et is the best way to serve the wishes of the listeners or viewers. The second argument against broadcast regulation is that bro adcasting is simply too complex for effective regulation by any government body, especially in li ght of the financial limits on an agency like the FCC.94 Consequently, with heavy wo rkload and limited resources, 91 Id at 69. 92 CHARLES H. TILLINGHAST, AMERICAN BROADCAST REGULATION AND THE FIRST AMENDMENT: ANOTHER LOOK 143. 93 Id 94 Id
60 thorough analysis is sacrificed for political expediency in regulatory policymaking.95 Tillinghast concluded by noting that most critics of broad cast regulation are either from, or influenced by, the Chicago school of economics which espouses all-out laissez-faire capitalism. He then ponders if the academics who advocate free-mark et solutions to regulation conducted their classes in the same manner, i.e. [t]he students, as consumers, would know what they wanted, and the instructors would be obligat ed to meet their expectations.96 In the final analysis, the socio-political real ities and nature of br oadcasting necessitates regulation in order to protect the public interest inhe rent in preserving pluralism and assuaging market failures. However, frustration with occasi onal failure of regulation to ensure protection of public interest or the uni ntended sporadic undesirable conseque nces of some regulations tend to call into question the ra tionale for regulation. Deregulation is often proffered as a solution to regulatory failure.97 Deregulation as Regulatory Policy Three justifications usually advanced for deregulation are: 1) although regulation seeks and has the noble intention of prot ecting public interests, it results in unexpected and pernicious effects;98 2) critics argue that regulat ion is used to reward political allies and entrenched industrial interests; and 3) opponents of regulat ion contend that governme ntal intervention to 95 For an elaboration of this argument and other attacks on broadcast regulation, see e.g. POWE & THOMAS KRATTENMAKER, REGULATING BROADCAST PROGRAMMING, supra note 61; and POWE, AMERICAN BROADCASTING AND THE FIRST AMENDMENT, Id 96 TILLINGHAST, AMERICAN BROADCAST REGULATION AND THE FIRST AMENDMENT, supra note 92 at 144. 97 EISNER, at al., CONTEMPORARY REGULATORY POLICY, supra note 6, at 15. 98 Id
61 solve socio-economic problems produces suboptim al results when compared with the free market.99 What theories may explain the policy sh ift from regulation to deregulation? Three major theoretical explan ations are offered for regul atory policy change. First, regulatory policy changes are mostly genera ted by forces within the bureaucracy.100 Secondly, well-organized, issues-based inte rest groups affect policy change s on particular issues and or programs by forming alliances with legislators an d bureaucrats responsible for those issues or programs thereby ensuring mutual benefits to the three to the exclusi on of nonparticipants in what some regard as iron triangle.101 Finally, the principal-agent pe rspective argues that elected officials (principals) seeking to maximize elect oral votes, regularly control the actions of regulators (agents) in order to alter policies that will maximize th eir votes and the agents accede in return for maximi zed budgetary allocation.102 Because each of these explanations has its strengths and weaknesses, it has been noted that blind adherence to th eoretical parsimony in trying to explain every policy change will lead to questionable outcomes.103 Moreover, while it should be admitted that th e established structures of regulatory control are receding due to the pressure of powerful ideo logical, technological, a nd economic forces, it is misleading to characterize such changes as deregulation.104 This is not only because, for the most part, the rationale for public intervention has not been challenged, but also because in many sectors the deregulation of one activity has been accompanied by regulation of other activities 99 Id 100 Id at 23. 101 Id at 23. 102 Id at 27. 103 Id at 32. 104 Kay and Vickers, Regulatory Reform: An Appraisal, supra note 32, at 223.
62 and explicit regulatory structur es are simultaneously enacted in place of what went before.105 Therefore, what emerges in practice is bette r termed regulatory reform because it is a paradoxical combination of deregulation and reregulation106 In conclusion, it should be noted that while its most zealous advocates promot e deregulation as a cure-all for many economic problems, it is more productive (and more accurate ) to view deregulation as simply another regulatory tool, which is better suite d to some problems than to others.107 This is because deregulation does not mean no regulation; rath er, it usually means replacing one tool of regulation with another, less restrictive tool.108 Independent Agencies as Imperative to Regulatory Policy Whether a nation is engaged in regulation or de regulation at any partic ular point, there is no doubt that regulatory agencies are im perative for the need of sustai ned specialized activity aimed at achieving regulatory policies.109 While not arguing that inst itutional arrangements for one country are appropriate for another country due to the differences in political and administrative traditions, one may agree with Giandomenico Majone that the American experience [of independent regulatory agencies] is very instructive,110 largely because the notion of independent regulator y agencies started there and much about the phenomenon has developed there. Therefore, we shall now exam ine independent regulatory agencies beginning 105 Id 106 Id. 107 EISNER, at al., CONTEMPORARY REGULATORY POLICY, supra note 6, at 15. 108 Id. 109 Majone, Introduction supra note 1, at 5. 110 Id
63 with their origination in the U.S. to their global diffusion and the involvement of ITU in establishing best practices gui delines for establishing indepe ndent regulatory agencies. Emergence of the Independent Regulatory Agencies Am ong the regulatory solutions from North America and Europe that have been internationalized are the inde pendent regulatory agencies.111 In North America, the U.S. in particular, most regulatory agencies were established by the Congress in the 1930s as a means of striking a balance between th e needs of emerging industries and the needs of the general citizenry.112 Further, such administrative agencies we re created by Congress when full attention is needed to an issue and the task at hand requires continuing supervis ion, extensive technical considerations, or the development of expert skills, or all of these.113 For example, in 1934, Congress, in exercising the powers c onferred on it by the Commerce Clause,114 created the Federal Communications Commission.115 The Commission was empowered to regulate communication by wire and wireless in such a manner that will serve public interest, convenience, and necessity.116 Thus, the FCC became the regulatory agency to which Congress 111 David Levi-Faur and Jacint Jordana, The Rise of Regulatory Capitalism: The Global Diffusion of a New Order 598 THE ANNALS OF THE AMERICAN ACADEMY OF POLITICAL AND SOCIAL SCIENCE 7 (2005). 112 Thomas Vicino, American Regulatory Policy: Factors Affecting Trends Over the Past Century 31 POLICY STU. J., 442 (2003). 113 T. BARTON CARTER, MARC A. FRANKLIN, & JAY B. WRIGHT, THE FIRST AMENDMENT AND THE FIFTH ESTATE: REGULATION OF ELECTRONIC MASS MEDIA 35 (6TH ED., 2003). 114 USCS Const. Art. I, 8, (To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes). Id. Clause 3. 115 47 U.S.C.. 151 (For the purpose of regulating interstate and foreign commerce in communication by wire and radio so as to make available, so far as possible, to all the peop le of the United States, without discrimination on the basis of race, color, religion, national origin, or sex, a rapid, efficient, Nationwide, and world-wide wire and radio communication service with adequate facilities at reasonabl e charges.there is hereby created a commission to be known as the ''Federal Communications Commission,'' which sha ll .execute and enforce the provisions of this Act). 116 47 U.S.C. 307(a)
64 has delegated some of its lawmaking authority and charged it with de veloping expertise to oversee the administration of communications policy.117 However, it has been observed th at such agencies are consti tutional oddities. blurring the lines between separation of powers because th ey create regulations, enforce regulations and other laws, and adjudicate on cases thereby exercising legislative, executive, and judicial powers.118 In fact, it has been found that 90% of laws that regulate Americans daily lives are enacted by these non-elected, politically insulated, job-se cure, career bureaucrats.119 In Europe, on the other hand, most independent regulatory agencies were created in the 1980s and 1990s as part of regulatory reforms.120 The intent of their creation is said to be the willingness of the political sovereigns to delegate important powers to independent experts in order to increase the credibility of their policy commitments.121 The global proliferation of the telecommunications regulat ory agencies began in the 1990s as indicated by the ITU data which showed that the nu mber of national telecommunications agencies multiplied ten times from about 12 in 1990122 to 123 by mid2003123 and their number reached 140 by the year 2005.124 Many benefits of telecommunications 117 JOHN D. ZELEZNY, COMMUNICATIONS LAW: LIBERTY, RESTRAINTS AND THE MODERN MASS MEDIA 369 (2004). 118 Id 119 Id at 8, paraphrasing KENNETH WARREN, ADMINISTRATIVE LAW IN THE POLITICAL SYSTEM 108 (1988). 120 Giandomenico Majone, From the Positive to the Regulatory State: Causes and consequences of changes in the mode of governance, 17 J. OF PUB. POLICY 139 (1997). See generally, GIANDOMENICO MAJONE, ED., REGULATING EUROPE (1996). 121 Id at 139-140. 122 INTERNATIONAL TELECOMMUNICATIONS UNION, ESTABLISHMENT OF AN INDEPENDENT REGULATORY BODY 2 (2001). 123 INTERNATIONAL TELECOMMUNICATIONS UNION, TRENDS IN TELECOMMUNICATION REFORM 2003: PROMOTING UNIVERSAL ACCESS TO ICTS. 3 (2003). 124 INTERNATIONAL TELECOMMUNICATIONS UNION, TRENDS IN TELECOMMUNICATION REFORM 2006: REGULATING IN THE BROADBAND WORLD 17 (2006).
65 reform are related to the establishment of an independent regulatory agency as shown by Scott Wallsten125 who, using panel data covering 200 countries from 1985-1999, found that establishing a regulatory authority before privatizing the telecom firm is correlated with improved telecommunications investment and telephone penetration (emphasis original).126 Further, he found that in a sample of 33 countries where the data were av ailable, investors were willing to pay substantially more for firms in countries where regulatory reform took place prior to privatizationthe absence of regulatory reform requires payi ng investors a risk premium to compensate for future regulatory uncertainty.127 Thus, the ITU suggests that in order to lay the grounds for a favorable investment climate and promote market opportunities, national regulatory agencies should be independent.128 What then constitutes an independent regulatory agency? According to Sanford Berg, et al,129 an independent regulatory agency should have the capacity of achieving three broad aims: protecti ng consumers from powerful service providers, protecting investors from arbitrary acti ons of government, and promoting economic efficiency.130 Berg, et al identified adequate resour ces, appropriate legal mandates, and clear 125 Scott J. Wallsten, Does Sequencing Matter? Regulation and Privatization in Telecommunications Reforms 2 (World Bank Policy Research Working Paper No. 2817 (2002). Available online at: http://econ.worldbank.org/resource.php?type=5 (Last visited May 1, 2006). 126 Id 127 Id 128 INTERNATIONAL TELECOMMUNICATIONS UNION, TRENDS IN TELECOMMUNICATION REFORM 2006, supra note 124. 129 Sanford V. Berg, Ali Nawaz Memon, and Rama Skelton, Designing an Independent Regulatory Commission 1 (PURC Working Papers, (n. d.) available at : http://bear.cba.ufl.edu/centers/purc/pub lications/working/documents/07/des_an.pdf (Last visited May 1, 2006). 130 Id at 2.
66 agency values and operating procedures as the necessary components for designing an independent regulator.131 In examining the independence of regulator y agencies in Europe, Michael Thatcher132 observed that agency independence from elected officials is indicated by factors such as appointments, tenure, and removals of regulators; allocation of re sources; and elected officials retention of the power to overturn agency decision.133 He operationalized his study of this aspect of agency independence by using five factors, namely: (a) party politic ization of appointments (the greater the politicization, the lower the independence and vice-versa); (b) departure of members of agencies, both for ced and voluntary resignations because sometimes it is difficult to distinguish the two (the less departures, the more independence); (c) tenure (the longer the greater independence); (d) allocation of financial and human resources; and (e) elected officials overturning decisions of agencies.134 Two other factors affecting independence of the regulatory agency identified by Thatcher ar e (a) relationship with regulat ees (indicated by agency-industry revolving door movement of staff, legal challenges of agency decision by industry and mergers 131 Id at 4. 132 Michael Thatcher, Regulation after delegation: independent regulatory agencies in Europe 9 J. OF EUROPEAN PUB. POLICY 954 (2002). 133 Id at 958. 134 Id at 959 (findings indicate that appointment of agency me mbers is generally not politicized, except with regards to Italys communications regulator where all members have party affiliations and many have run for office. But in Britain, no regulator has been recently politically active or linked to a party [p. 959] Although no regulator has been dismissed and, on average, regulators tenure have been longer than that of elected officials, but he found that regulators have limited human and financial resources. Finally, elect ed officials rarely use their powers to overturn agency decisions. In summary, Thatcher said governments do not use their most visible powers to control agencies though that does not necessarily mean agencies are independent from elected officials but it is an indication that if there is politicians control, it is done through resource allocation and informal contacts).
67 blocked by the agency);135 and (b) procedural legitimacy of the agency (as indicated by consultation, publication of information, a nd openness of the agencys decision making processes).136 Irene Wu surveyed communications regulatory ag encies of 18 countries across all regions of the world who have recently seen significan t improvement in their communications network development.137 According to Wu, indicators of the regulators independence from other government organizations include an agency leader with a guaranteed te rm of office who cannot be dismissed for unpopular decisions; funding whic h is independent of political review; and a scope of authority that is distinct from the government policy-making agency.138 Measures of independence from the industry include whether the incumbent operators are privately owned and whether there is frequent exchange of staff between the regulator and the regulated industry.139 Based on responses to the survey questions regarding the three i ndicators of agency independence from government, Wu found (and conc luded) that Nigeria is one of the five countries, along with Brazil, Canada, Hong Kong, and China whose regulators have very robust 135 Id at 963 (findings in this regard are generally mixed: there is an existing, but limited revolving door policy in Europes agencies [p. 963]; few mergers were blocked, perhaps because firms are dissuaded from attempting mergers that will not be approved [p. 964]; and there has been significant number of lega l challenges to agency decisi ons, except for Britain where there is virtually no legal challenge [p. 966]). 136 Id at 966 (findings indicate increasing op enness in decision making procedures occasioned by both political and public scrutiny, legislators demand for accountability for agency decisions, and extensive media coverage of agency activities [966-968]. Participation in the debate and decision making processes has widened to include consumer groups, users, and the European Commission. Agencies have produce consultation papers and draft decisions and invite comments; they are asking industry for and making available to the public informa tion about costs, profit margins, and service quality in order to decide/justify price structure. In conclu sion, Thatcher thinks agency decision maki ng processes represents [t]he greatest break with the past Id at 969). 137 Irene Wu, Traits of an Independent Communications Regulator: a Search for Indicators 32 (Federal Communications Commissions International Bureau Working Paper Series No. 1, 2004). Available Online at: http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-248467A1.pdf (Last accessed April 2, 2007). 138 Id at 27. 139 Id
68 independence from other state institutions.140 But she also observed that regulators of Brazil, Canada and Hong Kong have strong reputations for independence and that because Nigerias regulator is newly established, future decisions will determine whether it gains a similar reputation.141 International Telecommunication s Union Study Group Report The im perative of independent regulatory bodie s to telecommunication sector reform led the International Tele communications Union (ITU), as the paramount telecommunications regulatory body in the world,142 to convene a Study Group143 that produced a set of best practices guidelines for countries in transition to more liberali zed telecommunications markets to establish their inde pendent regulators.144 The Study Group relied on publications and reports from international organizations involved in telecommunications and development such as the ITU itself, World Bank, and WTO. The Report observed that in understanding what the term independent regulatory body implies, a consensus has developed around th e definition contained in WTO Regulation Reference Paper,145 which stated that the re gulatory body is separate from, and not accountable to, any 140 Id at 14. 141 Id at 14. 142 INTERNATIONAL TELECOMMUNICATIONS UNION, About Us 1 (n. d.) available at : http://www.itu.int/net/about/index.aspx (last accessed May 23, 2008). 143 INTERNATIONAL TELECOMMUNICATIONS UNION, supra note 124 at 2. 144 Id. 145 WORLD TRADE ORGANIZATION, ANNEX TO THE FOURTH PROTOCOL TO THE GATS AGREEMENT (1997) (the Agreement on Basic Telecommunications negotiated under the auspices of the WTO in February 1997).
69 supplier of basic telecommunica tions services. The decisions of and procedures used by regulators shall be impartial with re spect to all market participants.146 However, the Report observed that there can be no detailed definition that will be applicable to all countries due to the differences in legal and political systems and the level of telecommunications development. Therefore, in or der to facilitate the pr ocess of developing and outlining the best practice guidelines,147 the Report adopted a working guideline from The McKinsey Quarterly148 which noted that [w]here a regulator exists, it is important to ensure clarity of jurisdiction and defi ned resolution mechanisms, adequate organizational competence and funding, and political insulation. Independence derives more from th is latter factor than from any formal definition, and manifests itse lf in regulators power to dissent.149 Therefore, the Report recommended that the mandate of a regula tor should be clearly sp elled out in national laws the law must specifically identify the regula tory authority and it must specify its mandate and authority.150 Apart from the structural separation of the regulator from the Ministry which the Report says increases perception of regulatory independence, the Report also outlined other indicators for assessing the perceived independence of the regul atory agencies from government.151 Foremost among the indicators is the met hod of appointment of the head of the 146 INTERNATIONAL TELECOMMUNICATIONS UNION, ESTABLISHMENT OF AN INDEPENDENT REGULATORY BODY, supra note 124. 147 Id 148 Scott Beardsley and Mich ael Patsalos-Fox, Getting Telecoms Privatization Right 1 THE MCKINSEY QUARTERLY 3 26 (1995) (Cited in The ITU Report, note ii, 1995). 149 INTERNATIONAL TELECOMMUNICATIONS UNION, ESTABLISHMENT OF AN INDEPENDENT REGULATORY BODY, supra note 124 at 2-3. 150 Id. at 3. 151 Id. at 8.
70 regulatory body and his tenure.152 The report noted that although there are variations in the practices of appointing regulatory agency heads depending on the political and administrative tradition of the country in question,153 but it concluded that [r]eg ardless of the method of appointment, an effort should be made to ensure that the head of the regulatory body enjoys guaranteed term of office154 in order to promote independence from both the government and other political interests. The Report observed that Where a co llegiate body heads the regulator, the members of that body are commonly appointed in staggered fixed terms.155 On the financing a regulatory authority, the Report observed that re gulators are typically funded either through general government appropriations or fees and contributions or a combination of both.156 Nigeria, alongside U.S. and Nepal were listed among countries in the latter category. However, increa singly, regulators are using fees such as license fees, spectrum fees, and numbering fees as financial source s. Among the advantages of funding regulators through fees, especially in developing economies, is that recourse to fees and contributions would reduce the financial burden on governments w ho may not be able to ensure a consistent budgetary amount.157 The Report urged the necessity of minimizing costs passed on to the consumer when funding through fees and recommended that The regulator should ensure that the financial and budgetary aspect of regulation is made transp arent to the public.158 152 Id. 153 Id. 154 Id. at 8. 155 Id. 156 Id. at 7. 157 Id. 158 Id.
71 The Report stated that having and adhering to principles of the decision-making process enhances not only public trust a nd confidence in the decision of the regulator, [but also] these principles or guidelines provide a necessary context in which the regulator applies the rules set out, promoting in turn predictability, clarity, and consistency in decision making process.159 The Report observed that many regulators decision-maki ng principles are laid out in legislation and identified four indicators that can be used to measure adherence to the decision-making principles set out.160 These indicators are transparency (in terms of publishing in print and online papers, studies, proposed rules or other decisions);161 timely implementation of decisions (such as timelines for deci sions, issuance of license);162 feedback and monitoring mechanisms (reviewing previous decisions to ensu re results are as intended or not);163 and finally, private sector participation and public involvement (i.e. seeking input from all parties to be affected and gathering all the necessary information) in order to enhance legitimacy and transparency of regulations.164 The Report noted that [t]he question of independence becomes more obvious when considering the issue of who can overt urn the decisions of the regulator.165 Whereas in almost all countries the independent regulator has some reporting requirement either to the responsible Ministry, the legislature or just to publish an annual report, the report stated that in many 159 Id. at 16. 160 Id. 161 Id. 162 Id. 163 Id. at 17. 164 Id 165 Id. at 8.
72 countries the decision of the regulator cannot be overturned except through a court decision on appeal. [in] a substantial number of countries, the Minister or the cabinet [has] the power to overturn decisions of the inde pendent regulator on appeal or at their own discretion.166 Unfortunately the report did not suggest any preferred way for ensu ring oversight of the regulators decisions. Therefore, from the foregoing discussion of th e ITU Report, it may be concluded that the major indicators of a regulatory agencys independence are the security of the leaderships tenure, financial independence, and fair, transparent and accountable decision-making procedures. Conclusion This chapter exam ined the theoretical literature concerning regulatory policy, deregulation, and regulatory agencies. Although there are four theories that provide justification for policy and regulation, there are also two major theories th at criticize government intervention in form of regulation and or policy. Whereas th e proponents of regulatory policy intervention are concerned with public interest and the potential failures of the ma rket, the critics of government intervention prefer the free market forces allocation of resour ces and believe in the selfcorrective possibilities of the marketplace. While deregulation is presented as solution to occasional problems associated with regulation, others argued that deregulation is only an additional tool for policymakers and most sect oral deregulations are accompanied by other regulations. Finally, the imperativ e of independent regulatory ag encies, and American invention, has been shown to include not only ensuring tran sparency in the regulatory policy process, but, in the case of developing countries such as Nigeria, attracting forei gn investment. The global 166 Id.
73 recognition of the importance of these independent agencies has led the International Telecommunications Union to commission a study and publish a report on the best practices for establishing such agencies.
74 CHAPTER 3 HISTORICAL EVOLUTION OF THE OWNE RSHIP ST RUCTURE OF COMMUNICATIONS INDUSTRY This chapter examines the transformati on of telecommunications and broadcasting regulation in Nigeria from rest ricted government monopoly to the beginning of deregulation and market competition. The chapter surveys the hist ory of telephony and broa dcasting in Nigeria, including the incremental reforms in the co mmunications sector beginning with partial commercialization in the 1980s to the implementa tion of the Structural Adjustment Program. The chapter then discusses the debate on na tional communications policy and concludes by reviewing the commencement of the deregulation of the communications sector and the establishment of the two regulatory agencies. Colonial and Post-Colonial Communication Policies Both telephony and broadcasting were introduced to Nigeria by the British colonial governm ent in the early part of the 20th century. One thing common to the colonial governments policy for both broadcasting and telephony is the tight, monopolized control of both sectors by Her Majestys government. This le gacy of monopoly was continued for better or for worse by the subsequent post-colonial governme nts in Nigeria. First, the colonial and postcolonial policy on broadcasting will be examined. Colonial and Post-Colonial Monopolization of Broadcasting Broadcasting in Nigeria began through rebroadcasting in 19321 when the colonial government established a facility in Lagos to serve as a rediffu sion station that picked up and retransmits the short-wave signals of the BBC Empire Service.2 Subsequently, more facilities 1 Christopher Kolade, Broadcasting in Nigeria, in BROADCASTING IN AFRICA: A CONTINENTAL SURVEY OF RADIO AND TELEVISION 78 (Sydney Head, ed., 1974). 2 Id at 87.
75 were established in other Nigerian cities. In 1957, three years before independence, the broadcasting service became Nige rian Broadcasting Corporation,3 hereafter the corporation. As a government entity, the Corporation depended on government for its budget4 because, even though owners of radio and televisi on receivers paid license fees,5 the revenue was inadequate and went directly to the cen tral governments treasury.6 Moreover, in its early days, the Corporation was prohibited by its ordinance from advertising.7 It was argued that broadcasting should be free from direct political control was what led to converting the National Broadcasti ng Service into a public Corporation.8 However, it has also been pointed out that British colonialists held on firmly to the control of broadcasting without believing in the independence of public servi ce broadcasting. It was only when it became obvious that their colonial rule was ending that th ey established statutory corporations that were to be largely independent of the new African governments.9 Under the new independent Nigerian govern ment, broadcasting remained the monopoly of the government for various reasons, fore most among, the provision of the 1963 Constitution,10 which guarantees freedom of expression without expressly providing th e right to own and 3 Id at 80. 4 GRAHAM MYTTON, MASS COMMUNICATION IN AFRICA 63, (1983). 5 Kolade, Broadcasting in Nigeria, supra note 1 at 80-81. 6 Id at 81. 7 Id at 84 (citing NBC Ordinance, pt. 3, clause 14). 8 Id at 80. 9 GRAHAM MYTTON, MASS COMMUNICATION IN AFRICA, supra note 4 at 65 (1983). 10 Section 25(1) of the 1963 Constitution provided that Every person shall be entitled to freedom of expression, including freedom to hold opinions and to receive and impart ideas and information without interference. It has three caveats providing th at a law that is reasonably justifiable in a democratic society shall not be invalidated by this provision where such law is made in the interest of defence, public safety, public order, public morality or public health.... or [for the purpose of] regulating telephony, wireless broadcasting, television, or the exhibition of cinematograph films. S. 25(2a-c).
76 operate a broadcast media. Other reasons a dvanced for continuing government monopoly of broadcasting included the need to use broadcas t media heavily for development communication such as mass literacy, health education, and ag ricultural extension. A ccording to C. Ulasi,11 whereas the colonial government monopolized br oadcasting for propaganda purposes, political control, and the diffusion of cris is information, Nigerian inherito rs of the colonial state have equally justified state monopoly of broadcasting for reasons of political stability, unity, and public interest goals as they see them.12 But just before full independence and soon thereafter, the Regional governments (that later became stat es) established their broadcasting services.13 The Regions main motivation for establishing their br oadcasting systems was allegation of the Corporations partiality and partisanship; 14 allegations that one analys t described as both real and imaginary.15 The history of regional broadcasting is almost the beginning of television broadcasting in Nigeria and indeed in Africa because in Oct ober 1959, Western Regions television station based in Ibadan, pioneered television br oadcasting on the African continent16 with the call sign WNTV.17 Eastern regionss station, based in Enugu with the call sign ENTV, went on air a year later.18 In 1962, the Northern region and the federal government commenced television 11 C. C. Ulasi, Broadcasting and the Corporate state in Nige ria: Policy, Politics, and So ciety: Past and present 325 (1989) (unpublished Ph.D. Dissertation, University of Texas-Austin). 12 Id at 325. 13 LUKE UKA UCHE, MASS MEDIA, PEOPLE, AND POLITICS IN NIGERIA 40-41 (1989). 14 Id at 41. 15 Id 16 Id at 40. 17 Kolade, Broadcasting in Nigeria supra note 1, at 85. 18 UCHE, MASS MEDIA, PEOPLE, AND POLITICS IN NIGERIA, supra note 13 at 40.
77 broadcasting with RKTV based in Kaduna and NBC-TV based in Lagos respectively.19 It should be noted that each of the regions almost simu ltaneously established radio broadcasting alongside their TV stations.20 Although these regional broadcasters introduced some competition in the broadcasting environment and increased the range of available programs, they also introduced sectional and divisive politic s as one critic stated: The sole responsibility of regional broadcasting is to radiate a Regional imageThe setting up of regional corporations does not bring about true compe tition. That can only be achieved by setting up a number of corporati ons having national c overage and offering a range of programmes which would benefit the whole country. There is no sign of that in Nigeria. Whatever the benefits and there ar e benefits the cost is too high and danger exists that divided control in a developing society may promote regional feeling instead of encouraging the desire to live together and act together.21 Regardless of the merits and disadvantages of the regional broadcasting, they have at least altered the structure of br oadcasting in Nigeria. The structure of broadcasting continued to co mprise only the national broadcaster (the Corporation) and the regional broadcasters throughout the First republic (1960-1966) and for most of the 1960s. After the overthrow of the First Republic, a new military regime abolished the regions and created 12 states. The NBC established broadcasting stations in the capitals of the 12 states where there were none.22 Thus, NBCs stations were found in Lagos, Ibadan, Kaduna, Sokoto, Kano, Maiduguri, Jos, Enugu, Ca labar, Port Harcourt, and Benin.23 19 Kolade, Broadcasting in Nigeria supra note 1, at 85. 20 UCHE, MASS MEDIA, PEOPLE, AND POLITICS IN NIGERIA, supra note 13. 21 Ian MacKay, Concepts of Nigerian Broadcasting 64, 788 EUROPEAN BROADCASTING UNION REV. (1963). Cited in UCHE, MASS MEDIA, PEOPLE, AND POLITICS IN NIGERIA, supra note 13, at 41. 22 Kolade, Broadcasting in Nigeria, supra note 1 at 81. 23 Id
78 Another military regime was to restructure broadcasting in 197624 and 1979.25 By virtue of the Decree No. 24 of 1976, (hereafter the NTA Decree), all television st ations established by the regions, and inherited by states, were taken over by the federal government.26 All the stations were to be managed by the newly established Nigerian Television Authority (NTA). The NTA was mandated to provide as a pub lic service in the interest of Nigeria, an independent and impartial television broadcasting for general reception within Nigeria.27 The NTA also had to ensure that its services refl ect the unity of Nigeria as a federation [and] give adequate expression to the culture, characteristics, and affairs of each state, Zone, or other part of the federation.28 But a sweeping provision of the NTA Decree ap parently conferred, to some extent, the function of a regulatory agency on the NTA as provided thus: The aut hority shall, to the exclusion of any other broadcasting authority or any person in Nigeria, be responsible for television broadcasting in Nigeria.29 The Decree sought to make the NTA an independent broadcaster by requiring th at its programmes maintain a proper balance30 and ensure due impartiality31 especially in reporting political matters industrial controversy, or public policy.32 The major drawback to this, however, is the Decrees provision that imposed on the NTA the 24 NIGERIAN TELEVISION AUTHORITY DECREE NO. 24 (1976). 25 FEDERAL RADIO CORPORATION OF NIGERIA DECREE NO. 8 (1979). 26 NIGERIAN TELEVISION AUTHORITY DECREE, supra note 24 S.7(1). 27 Id. S. 6(1). 28 Id. S. 6(2). 29 Id. S. 7(1). 30 Id. S. 9(1b). 31 Id. S. 9(1c). 32 Id. S. 9(1d).
79 duty to broadcast government programs such as ministerial speeches consisting wholly statements of fact or which explain the policy and action of the government33 as well as government announcements requested by an authorized public officer.34 Three years after enacting the NTA decree, the same federal military government that seized and centralized televisi on stations and programming decen tralized radio broadcasting by handing over 17 radio stations owne d by the NBC to the states where they were located through the promulgation of the Federal Radio Cor poration of Nigeria Decree (hereafter FRCN Decree).35 But the FRCN Decree left the SW broad casting stations in Kaduna, Enugu, Ibadan, and Lagos under the control of the federal gover nment while also outlawing SW transmission by any state broadcasting station and decreed all stat e radio stations to limit their broadcast to the AM/MW bands.36 The functions of the FRCN with rega rds to impartiality and balance outlined by the Decree were very similar to NTAs functions outlined in S. 2(1-4). With the promulgation of the NTA and F RCN decrees, the federal government owned radio and television stations a nd the state governments owned radio stations. Specifically, the states were left or confined to the AM/MW ba nd while the federal government owned stations that transmitted nationally on the SW band.37 This was the structure of broadcasting left behind by the military regime which handed over power to a democratically elected government on October 1, 1979. 33 Id. S. 10(a). 34 Id. S. 11(1). 35 FEDERAL RADIO CORPORATION OF NIGERIA DECREE, supra note 25, Schedule 3(8(1)). 36 Id S. 6(1). 37 MYTTON, MASS COMMUNICATION IN AFRICA, supra note 4 at 119.
80 The 1979 Constitution which ushered in the Second Republic contained freedom of expression provisions very similar to the Second Republics 1963 Constitution,38 but it added the right to own any medium for the dissemin ation of ideas, information and opinions.39 However, there was a caveat that stated no person other than the Governme nt of the Federation or of a State or any other person or body authorized by the President shall own, establish or operate a television or wireless broadcasting for any purpose whatsoever.40 On the face of it, this provision can be interpreted to mean that any person interested in owning broadcast media can seek for presidential authorization. However, it soon became obvious that it is not private individuals or bodies that would own radio and television sta tions; rather, it was the governments of the various states as well as the federal government itself. Perhaps the provisions regarding impartial ity and maintaining proper balance when reporting political and other controversies enshrined in the decrees of NTA and FRCN were not yielding the intended results during the Second Re public for three major reasons. First, there were allegations of bias against federal gove rnment-owned media by the states that were controlled by the opposition parties.41 Although there are cases of bi as by the federal government media, Graham Mytton argued both the FRCN and NTA were conscious of their credibility and the implications of being perceived as organs of the federal government (or worse the ruling 38 Section 25(1) of the 1963 Constitution provided that Every person shall be entitled to freedom of expression, including freedom to hold opinions and to receive and impart ideas and information without interference. It has three caveats providing th at a law that is reasonably justifiable in a democratic society shall not be invalidated by this provision where such law is made in the interest of defence, public safety, public order, public morality or public health.... or [for the purpose of] regulating telephony, wireless broadcasting, television, or the exhibition of cinematograph films. S. 25(2a-c). 39 CONSTITUTION OF THE FEDERAL REPUBLIC OF NIGERIA S. 36(2). 40 Id S. 36(2). 41 MYTTON, MASS COMMUNICATION IN AFRICA, supra note 4 at 122; see also UCHE, MASS MEDIA, PEOPLE, AND POLITICS IN NIGERIA, supra note 13 at 56.
81 National Party of Nigeria). Theref ore both media have maintained so me degree of impartiality in reporting controversies including sides that were very criti cal of the federal government.42 The allegation of bias prompted many stat es controlled by opposition parties such as Lagos, Plateau, and Kano to establish their own television stations.43 Secondly, and similarly, the federal government complained of bias by radio stations of states controlled by the opposition parties44 and therefore it established FM stations in nearly all the state capitals of the federation.45 Thirdly, both the ruling part y and the opposition were at consensus that neither of them should be allowed to control the various government-owned media during the subsequent general elections.46 Consequently, the National Assembly (Nigerias congress) enacted the 1982 Electoral Act that established a National Adviso ry Council to supervise and or oversee federal and state governments owned media for three months prior to and one month after the elections.47 The Council was made up of members of all political parties. The president was said to have complained bitterly about the pr ovision but grudgingly assented to the Act.48 During the Second Republic, the newly establishe d state television stations were confined to UHF channels because there was not enough sp ectrum on the VHF band that was being used 42 MYTTON, MASS COMMUNICATIONS IN AFRICA, Id at 122. 43 Id at 120. 44 UCHE, MASS MEDIA, PEOPLE, AND POLITICS IN NIGERIA, supra note 13 at 56; see also MYTTON, MASS COMMUNICATION IN AFRICA, supra note 4 at 124. 45 MYTTON, MASS COMMUNICATION IN AFRICA, supra note 4, at 124; see also UCHE, Id at 56. 46 UCHE, Id at 152. 47 UCHE, MASS MEDIA, PEOPLE, AND POLITICS IN NIGERIA, supra note 13, at 152; see also MYTTON, MASS COMMUNICATION IN AFRICA, supra note 4 at 130n. 48 MYTTON, MASS COMMUNICATION IN AFRICA, supra note 4 at 130n (president Shehu Shagari was reported to have said he does not like this provision and hoped the National Assembly will consider amending it, FRCN, Lagos, 6th August, 1982).
82 by the federal government-owned television stations.49 Notwithstanding the UHF/VHF politics, many television stations were established by the opposition parties in states they controlled such as Lagos, Kano, Plateau, Ondo, and Gongola.50 The various state and federal government media outlets ensured that it was very difficult, if not impossible, to suppress information because what one medium suppressed, another will publish or broadcast.51 In general, during the Second Republic (1979-19 83), Nigeria was said to have the most diverse media in Africa52 as indicated by the estimated 15 da ilies, 12 political weeklies, 25 radio stations and 32 television stations, all of whic h became conduits for political battles because the political pluralism (with 19 states, five political parties each of which controlled not less than two states) was clearly reflected in the media.53 Consequently, as they reported politics, the Nigerian mass media became in every sense, politic al institutions of central importance to the functioning of Nigerian democracy.54 By the time the military overthrew the S econd Republic in December 1983, the structure of broadcasting in Nigeria comprised federal government-owned radio an d television stations that broadcast on VHF and SW/FM, and state gove rnment owned radio and television stations that broadcast on AM/FM/MW and UHF. It is not on the record that any private entity sought a license for broadcasting during the Second Republic, therefore the opportunity to test the Constitutional provision authorizing the presiden t to grant broadcast license was missed. The 49 Id. at 119. 50 Id. at 120. 51 Id. at 119. 52 Id. at 79. 53 Id. at 118. 54 Id.
83 new military regime maintained the structure of broadcasting inherited from the Second Republic for the first few years. However, by the late 1980s certain factors indicated a change in the status quo of a government monopoly of broadcasting in Nigeria. Colonial and Post-Colonial Monopolization of Telephony In m any African nations, including Nigeria, the telephone was introduced by European colonialists as a mechanis m of control and governance.55 Nigerias case of telecommunication introduction is very similar to that of many Af rican countries. Nigerias colonizer, Britain, as prominent Nigerian historian, J. F. Ade Ajayi observed,56 in order to protect and expand her trade in the interior, saw the need to es tablish and control comm unications, railways, a telegraph systems and roads that cut acr oss the existing states and communities.57 The increased communication helped consolidate the powers of th e British governor as mo re issues were then referred to colonial Secretariat in Lagos where it can be sa id that everything going on the country was regulated on paper.58 This is evidenced from the f act that in 1886 the first cable connection was establis hed between Lagos and colonial office, London.59 The first commercial trunk telephone was only completed in 1923 and by 1952 the lines have been extended to connect the major commercial and regional poli tical centers of Lagos, Ibadan, Kaduna, Kano, and Enugu among themselves and to the London colonial office.60 However, these colonial telecommunication facilitie s were geared towards dischargi ng administrative functions rather 55 ELI M. NOAM, Introduction, in TELECOMMUNICATIONS IN AFRICA 3 (Eli M. Noam, ed., 1999). 56 J. F. ADE AJAYI, MILESTONES IN NIGERIAN HISTORY 23 (1962/1980). 57 Id at 23-24. 58 Id at 28. 59 G. O. Ajayi, R. I. Salawu, and T. I. Raji, Nigeria After a Century of Tel ecommunications Development, What next? in TELECOMMUNICATIONS IN AFRICA 193 (Eli M. Noam, ed., 1999). 60 Id at 163.
84 than the provision of socio-economic development of the country.61 Further, and unfortunately, the colonialists left behind both inadequate infrastructure and an obsolete organizational structure62 characterized by a state monopoly system called Post, Telephone and Telegraph (PT&T). After Nigeria gained political independence in 1960, similar to many nations that became independent in the 1960s, telecommunications was recognized as a tool for economic development and therefore was refocused towards achieving national coherence and development.63 However, many independent African na tions including Nigeria retained the system of state monopoly of telephony as part of their central economic planning and partly because of how the new countries ch erished their national sovereignty.64 Nigerias post-colonial government retained monopoly of telecommunications facilities under the auspices of Department of P&T and th e constitution vested the Federal Legislature with the exclusive power to make laws regard ing Posts, telegraphs, and telephones, as well as Wireless, broadcasting and televisionallocat ion of wavelengths for wireless, broadcasting and television transmission.65 The Cable and Wireless Act of 1962 vested the Ministry of Communications with the power of regulation of telecommunications. Notwithstanding the continuing monopoly of the control and regulation of telecommunications by the federal government, Nigerias new leaders sought to address the inadequacy of telecommunications infrastructure through the First National Development Plan 61 FEDERAL REPUBLIC OF NIGERIA, NATIONAL TELECOMMUNICATIONS POLICY 11 (2001). 62 Noam, Introduction, ,supra note 55 at 3. 63 Id 64 Id. 65 See THE CONSTITUTION OF THE FEDERAL REPUBLIC OF NIGERIA 1963, S. 69 (Schedule I: Items 32 & 43); THE CONSTITUTION OF THE FEDERAL REPUBLIC OF NIGERIA 1999, S. 4(2) (Schedule II: Items 46 & 66).
85 (1962-68) by increasing telecommunication facilities for th e major urban areas, that are also the commercial and industrial centers of the country.66 The Plan proposed the installation of additional 60,000 lines to the existing 30,000 lines.67 The Plan succeeded in ensuring the construction of a microwave linking those commerci al and industrial citi es as well expanding the international telephone and te lex services. But of the pr oposed 60,000 lines, only 26,000 were installed68 such that by the late 1960s, there we re only a total of 48,000 installed lines.69 In short, the early years of post-indepe ndence and throughout the 1960s witnessed little improvement in terms of the development of tel ecommunications infrastructure and availability of telecommunications services largely because of the political turmoil, especially the civil war, which disrupted Nigerias economic activities including the expansion of telecommunications facilities.70 But the next decade and half witnessed some progress with increased installed lines, satellite earth stations, and the complete take over of international telecommunication services by the government through the acquisition of the contro lling shares in the Cable & Wireless of UK, renamed the Nigerian Extern al Telecommunications (NET).71 Moreover, the three post-civil war National Development Plans also incorporated telecommunications development, which ensured the repairing of war-damaged facilities, the introduction of Nigerian Domestic Satellite 66 Raymond U. Akwule, Telecommunications in Nigeria 15 TELECOMMUNICATIONS POLICY 241 (1991) citing Ibrahim Aliyu, Telecommunications in Nigeria status report, in Ministry of Communications, Seminar on Telecommunications Policy for Nigeria 27 (26th Jan 6th Feb, 1987). 67 Chuka Onwumechili, Dream or reality: providing universal access to basic telecommunications in Nigeria? 25 TELECOMMUNICATIONS POLICY 219 (2001). 68 Ajayi, et al., Nigeria After a Century of Telecommuni cations Development, What next? supra note 59 at 164. 69 Akwule, Telecommunications in Nigeria, supra note 66 at 242 (this figure does not add up taking into cognizance Onwumechilis assertion that there existed 30,000 lines to which the new post-colonial government wanted to add 60,000 but succeeded in adding only 26,000). 70 Ajayi, et al., Nigeria After a Century of Telecommuni cations Development, What next? supra note 59 at 164. 71 Id at 165.
86 (DOMSAT) that operates using leased INTELS AT transponders, and the construction of alternative international telecommunicati ons network with submarine cables. By 1984, the structure of the te lecommunications sector comprised Department of Posts and Telecommunications (P&T), re sponsible for internal teleco mmunication services; and NET, responsible for external telecommunications and thereby providing the gateway to the outside world. Both P&T and NET were under the Ministry of Communications.72 But while NET was given some autonomy, which perhaps is why it was profitable and even generating foreign exchange for the country, P&T remained tigh tly controlled by the government and was losing money.73 This might have informed the decision of the military regime to initiate a reorganization of the Ministry of Communications pa rastatals, including a modest reform of the telecommunications sector in 1985. The telecommunications and pos tal divisions of P&T were decoupled and the telecommunications division was merged with NET to form a limited-liability company called Nigerian Telecommunications Limited (NITEL),74 whose main objective was to harmonize the planning and co-ordination of the internal and external telecommunications services, rationalize investments in telecommuni cations development and provide accessible, efficient and affordable services.75 There are two other major outcomes of th e reorganization of the Ministry of Communications parastatals. First, is the emergence of what seemed like the precursor to the current NCC, i.e. the creation of the Technica l Services Department in the Ministry with responsibility for some of the regulatory and administrative aspects of telecommunications, 72 FEDERAL REPUBLIC OF NIGERIA, NATIONAL TELECOMMUNICATIONS POLICY, supra note 61 at 11. 73 Akwule, Telecommunications in Nigeria, supra note 66 at 244. 74 FEDERAL REPUBLIC OF NIGERIA, NATIONAL TELECOMMUNICATIONS POLICY, supra note 61 at 12. 75 Id
87 including frequency allocation a nd management, and manufacturing.76 Secondly, NITEL was granted some autonomy that enabled it to raise tari ffs in line with the devaluation of the national currency. As a result, the company raised its tariffs by 600% and 800% in 1988 and 1990 respectively.77 These modest reforms in the form of reorganization of the ministerial parastatals yielded some development in the telecommunications in frastructure and quali ty of services. For example, by the time the reform commenced in 1985, the installed capacity of lines was 295,350 with only 194,499 lines conn ected; but six years after, that is by 1991, while NITELs number of installed capacity had risen to 450,000 lines, only about 294,000 lin es were actually connected. Further, more than 500,000 applicants were waiting for NITEL to provide them with lines.78 The alternative solution faltered as Bala Muhammad observed: To compensate for its dismal performance in the residential sector, NITEL has for long been operating a payphone system. Soon af ter the monopolys inception in 1985, ITT was contracted to supply and install payphone kios ks all over the country. This coincided with a downturn of events in the Nigerian econom y, and the coin-boxes became easy prey for the hard-up. Therefore, due to vandalisati on in the coin-operated system, it was soon withdrawn from service.79 Finally, rural telephony remained problematic ev en though the rural areas are where 70% of Nigerians live.80 Even the attempt to issue private radio licenses for rural areas resulted in only 76 Akwule, Telecommunications in Nigeria, supra note 66 at 244. 77 Onwumechili, Dream or reality: providing universal access to basic telecommunications in Nigeria? supra note 67 at 226. 78 AFEIKHENA JEROME, PUBLIC ENTERPRISE REFORM IN NIGERIA: EVIDENCE FROM THE TELECOMMUNICATIONS INDUSTRY 24 (2003). 79 Bala Muhammad, Dawn of the GSM: Hope and Despair in the Nigerian Telecoms Market 3. Paper presented at the Annual Conference South African Communication Association, Pretoria, September 27-28, 2001. 80 Akwule, Telecommunications in Nigeria, supra note 66 at 246.
88 little, if at all any, pr ogress in improving telecommunications facilities in the rural areas.81 In short, at the beginning of the 1990s, telecommuni cations services in Nigeria were not only monopolized by the governments NITEL, but services were inadequate or poor for the urban residents and sadly unavailable in the rural ar eas where a majority of the nations populace resides. It is at this point that major regulatory policy reforms commenced in both telecommunications and broadcasting. Commencing Regulatory Reforms The first factor often cited for the co mmence ment of regulatory reforms is the IMF/World Bank-induced economic reforms that emphasized the privatization and or commercialization of public corporations.82 The goals of the reforms, which were part of the Structural Adjustment Program (SAP), were said to include efficient and effective management of the (privatized) corporations to ensure profitability and en d the wasteful expenditure of government resources on public corporations.83 This began in the 1980s, after many developed countries followed U.S., Britain, and Japa n to reform their monopoly telecommunication sectors.84 In the name of SAP, the World Bank so ught compliance not only with the projectspecific conditions it normally attaches to loans, but it also asked for the initiation and adherence to broad sectoral and even national macroeconomic reforms.85 The World Bank pushed for reforms especially within the telecommunications sector in many African countries by linking 81 Id 82 Jubril Bala Mohammed, Democratization and the challenge of Private Broadcasting in Nigeria 8 AFRICA MEDIA REV. 81, 83 (1994). See also Folu Ogundimu, Private-enterprise broadcasting and accelerating dependency: Case studies from Nigeria and Uganda, 58 GAZETTE: INTL. J. FOR COMM. STUDIES 159 (1996); & Chuka Onwumechili, Privatization of Electronic Media in Nigeria 7 HOWARD J. OF COMMS. 365 (1996). 83 Mohammed, Id at 83. 84 Noam, Introduction supra note 55 at 5. 85 MORTEN BOAS AND DESMOND MCNEILL, MULTILATERAL INSTITUTIONS: A CRITICAL INTRODUCTION 64 (2003).
89 loans to progress in reforms, including corporat ization (commercializati on) and privatization.86 For example, in the case of Nigeria, a 1990 World Bank decision to suspend a $225 million telecommunications loan was said to be critical to the commencement of major reforms and the deregulation of the telecommunications sector b ecause the Bank cited the need to strengthen the countrys policy framework, commercialize NITEL, a nd improve access to services as part of the reasons for its action.87 In 1988, the military regime promulgated a Decree88 on the reforms program and set up a committee known as th e Technical Committee on Privatization and Commercialization to execute the privatization and commercialization of public corporations. The second often cited factor is said to be local, or rather national, in the sense that within the country there were pressures resulting from the demands for telecommunications services89 on the one hand, and agitations by leading industry professional s and journalists90 for the licensing of private broadcasters. Two seminars on telecommunications91 and broadcasting92 in the late 1980s provided the forum for the articu lation of the local agita tions and pressures for policy reforms. At the seminar on telecommuni cations policy, many argued that the massive investment by government in the sector ha d produced negligible improvements in telecommunications services and insignificant developmen ts in telecommunications 86 Noam, Introduction supra note 55 at 5. 87 CHUKA ONWUMECHILI, REFORM, ORGANIZATIONAL PLAYERS, AND TECHNOLOGICAL DEVELOPMENTS IN AFRICAN TELECOMMUNICATIONS: AN UPDATE, AT P. 137 (2003). 88 COMMERCIALIZATION AND PRIVATIZATION DECREE NO. 25 OF 1988. 89 Akwule, Telecommunications in Nigeria, supra note 66 at 241. 90 Ogundimu, Private-enterprise broadcasting and accelerating dependency: Case studies from Nigeria and Uganda, supra note 82. 91 See generally Ministry of Cornmunications, Seminar on Telecommunications Policy for Nigeria (26th Jan 6th Feb, 1987) (Federal Government Printer, Lagos, Nigeria, 1987). 92 See generally TONY NNAEMEKA, EGERTON UVIEGHARA, DIDI UYO, EDS., PHILOSOPHY AND DIMENSIONS OF NATIONAL COMMUNICATION POLICY (1989).
90 infrastructures.93 It was contended that both the operat ional and managerial problems of the sector were caused by the governments monopo ly of the provision of telecommunication services and infrastructures.94 While the telecommunications polic y seminar did not result in the formulation of a national teleco mmunications policy, the seminar on broadcast reform succeeded in that regard through the recommenda tions of the Committee on National Mass Communications Policy.95 One of the major forums where the debate a bout the propriety or otherwise of private broadcasting took place was the seminar on National Communication Policy organized by the Federal Ministry of Information and Culture. This seminar brought together practitioners as well as scholars from communication and re lated interdisciplinary subjects.96 The gathering, which took place in August 1987, had ideological advocates from the left, right, and the middleroadists.97 The report of the seminar was subseque ntly modified by various government appointed panels98 and eventually adopted on April 10, 1990 by the then highest rule-making body of the federation, the Armed Forces Ruling Council, as the National Mass Communication Policy (NMCP).99 Before delving into the pr ovisions of NMCP, it may be apt to briefly highlight 93 Aliyu, Telecommunications in Nigeria status report, supra note 66 at 39. 94 See e.g., PC. Uchediuno, Tariff policy and economics of telecommunications, in Ministry of Communications, op cit, Ref 5, p 64-82; in Ministry of Cornmunications, :Seminar on Telecommunications Policy for Nigeria; and B. Carew, Modernization of telecommunications in Nigeria a strategy for the new information technology, in pp 363-377 in Ministry of Cornmunications, Seminar on Telecommunications Policy for Nigeria, all cited by Akwule, Telecommunications in Nigeria, supra note 66 at 241. 95 NATIONAL BROADCASTING COMMISSION, NIGERIA BROADCASTING CODE (2002). 96 FEDERAL MINISTRY OF INFORMATION, NATIONAL MASS COMMUNICATION POLICY 3. 97 Id at 5. 98 Id at 3-4. 99 Id at 4.
91 some of the arguments of the proponents and opp onents of broadcast priv atization, especially those presented at the seminar as well as witnessed in scholarly writings. Proponents of private broadcast ownership ar gued that privatization will increase the medium available for public discourse on polic y issues because An informed public is a sine qua non for a democratic society.100 They dismissed arguments about potentia l threats to national stability by observing th at Precisely how ethnic and civil strife might result from private competition in broadcas ting has never been explained.101 But an opponent of privatization observed that private broadcasters are likely to rely on foreign programming that may threaten cultural identity and peace and stability, arguing that a: private operator in his drive for profits will ai r, What the people want, rather than what the people need. In most cas es, as shown in the UK, Ital y, Canada, Australia, and the USA, this has been interpreted to mean sex, violence, fashion, cars and gossip. Since private broadcasters will be forced to compete for adverts, they will appeal to the lowest common denominator in order to capture the largest audience.102 This argument buttresses the concern for the need to use broadcasting for development communication rather than for commer cial enrichment of the operator. Others took the middle position by arguing neit her for unfettered privatization nor for continued government monopoly. For example, Mohammed103 explored the argument that privatization and or competition will result in diversity of choice for the audience and reduce government control.104 He contended that broadcasters c onsideration for revenue, more than 100 Egerton Uvieghara, Law reform and national communication policy in PHILOSOPHY AND DIMENSIONS OF NATIONAL COMMUNICATION POLICY, supra note 92 at 377. 101 Ulasi, Broadcasting and the Corporate state in Nigeri a: Policy, Politics, and Society: Past and present, supra note 11 at 339. 102 Madu G. Mailafiya, Media policies in Nigeria and selected Third World countries in PHILOSOPHY AND DIMENSIONS OF NATIONAL COMMUNICATION POLICY, supra note 92 at 138. 103 Mohammed, Democratization and the challenge of Private Broadcasting in Nigeria supra note 82 at 81. 104 Id at 87.
92 audiences taste, was likely to inform programming.105 He observed that the experience of a Nigerian privately owned print media taking sides with government and serving almost as the ruling partys newsletter raised doubts about elimination of government control.106 He also wondered if quality programming and competition were not incompatible107 as the quest for profit margin leads to cuts in labor and production costs,108 which can hardly guarantee quality programming that is releva nt to the national polity.109 Mohammed cautioned against broadcast liberalization that would lead to the rich and powerful becoming richer and more powerful while the poor and powerless get poorer and more powerless.110 To minimize this likelihood and particularly the possible c oncentration of ownership,111 he recommended that apart from legal requirements, corporate bodies with developmentoriented interests such as pressure groups, higher education institutions, and communities, rath er than those with profit-making interests, should be accorded pr iority in licensing.112 A similar observation was made by Emmanuel Akpan,113 who argued for the need to allow private ow nership of broadcast media and to create an independent regulatory body w ith power to grant and cancel licenses. Akpan suggested that 105 Id at 87. 106 Id at 88 107 Id at 92 108 Id 109 Id 110 Id at 93. 111 Id at 94. 112 Id 113Emmanuel Akpan, Broadcast Journalism in Multi-Party State in MASS COMMUNICATION IN NIGERIA: A BOOK OF READING[?] 218-227 (Onuora E. Nwuneli, ed.,1985).
93 the granting of licenses should give emphasis to small and local broadcasters that are likely to provide an opportunity for democratic discussions.114 These and many other discussions inform ed the provisions of the National Mass Communication Policy. The policy noted that si nce Nigeria does not have a state ideology,115 the philosophy of the national mass communication polic y can be based on chapter two of Nigerias constitution which outlined The Fundamental Objectives and Di rective Principles of State Policy.116 Thus, the objectives of the policy included identifying th e critical mechanisms or institutions involved in the development of Nigerias communicati on system and providing guidelines for the mobilization of such mechan isms and institutions to achieve national objectives;117 ensuring better management of communication resources;118 harnessing cultural wealth and cultivating deep sense of patriotism and propagating distinctive national identity;119 protecting and furthering at home and abroad Nigerias national interests and security;120 and encouraging and promoting indigenously rooted innovation for the collective good rather than for individual self-expression.121 The NMCP provisions regarding electronic media are contained in the policys Chapters IV and XII, which dealt with el ectronic media and regulatory ag encies respectively. In Chapter 114 Id at 225-226. 115 FEDERAL REPUBLIC OF NIGERIA, NATIONAL MASS COMMUNICATION POLICY 5. 116 CONSTITUTION OF THE FEDERAL REPUBLIC OF NIGERIA 1999, Chapter 2. 117 FEDERAL REPUBLIC OF NIGERIA, NATIONAL MASS COMMUNICATION POLICY 5-6. 118 Id at 6. 119 Id at 6. 120 Id at 6. 121 Id
94 IV,122 the policy noted the importance of electroni c media in general and the immense and limitless123 potential of the visually oriented ones in particular. The policy objectives for electronic media included disseminating informa tion to enhance the health, economic, cultural and other welfares of the populace ; providing comprehensive coverage of the Nigerian culture; utilizing programs as vehicles for mobilizi ng the rural populace fo r national development; positively contributing to the promotion of nati onal unity and national integration by making sure that there is balanced presentation of views from all parts of the country;124 emphasizing the broadcast of news and programs in indigenous languages;125 and providing regular channels of communication between th e government and the people126 and providing opportunity for healthy discussion of important national issues designed to enlighten and mobilize the public.127 With regards to the ownership of electron ic media, the policy recommended that the provisions of 1979 Constitution was adequate and concluded that [t] he time is not yet ripe for private ownership of the [electronic] media.128 As part of the implementation strategy, the policy recommended the establishment of a regu latory body to ensure compliance with the provisions of the policy as well as redressing the rural-urban imb alance of information flow and recommended the establishment of rural viewing centers to enhance the flow of information. 122 Id at 9. 123 Id 124 Id at 10. 125 Id 126 Id 127 Id 128 Id
95 Chapter XII of the policy observed that the two vital roles of laws as frameworks for sound communication policy129 are the (i) acceptance of press freedom as the bedrock of a democratic and egalitarian society130 and (ii) recognizing the need for protecting the administration of government, public me n, and security of life and property.131 The policy therefore recommended the enactment of laws gua ranteeing freedom of the press including right to access to information and the right not to disclose sources of information,132 as well as enactment of humane laws which will ensure that the rights and freedoms are not abused or misused.133 As part of the implementation strate gy for these recommendations, the NMCP suggested the establishment of two regulatory bodies, to be known as National Communication Commission and the Nigerian Media Council. When establis hed, the National Communication Commission will have three specialized divisions on print media, electronic media, and training and research in mass communication.134 The functions of th e National Communication Commission, as it relates to broadcasting, in clude, among other things, the regulation and supervision of the operations of national media; providing parameters for all broadcasting stations (national, state, privately-owned or commer cial broadcasting stations);135 setting moral and ethical standards for broadcasting. maki ng broadcasting truly impartial [and] Upholding the principles of fairness and balance;136 and prescribing sanctions and institutionalizing a 129 Id at 34. 130 Id 131 Id 132 Id 133 Id 134 Id at 40. 135 Id at 39. 136 Id at 40.
96 mechanism for monitoring and enforcement.137 The composition of the National Communication Commission shall include a Chairman appointed by the president and representatives of Ministries of Information, Communication, Educ ation; and representatives of NTA, FRCN, Nigeria Union of Journalists, Radio and Televi sion Theatre Workers Union, Association of Advertising Practitioners of Nigeria, the Nigerian Institute of Public Relations and Film Makers Association of Nigeria.138 Unlike the elaborate discussion of the co mposition, functions, and structure of the National Communication Commission, the policy wa s very brief about th e other regulatory body it recommended to be established, i.e., the Nigeri an Media Council. The policy simply stated that the Council shall be composed predominantly of journalists of high standing and integrity. Its functions shall include the admini stration of the professional code of ethics and registration and accreditation of journalists.139 Surprisingly, although the policy stated that the time was not ripe for private ownership of electronic media, it, however, provided for the criteria for granting private broadcasting licence when the time is c onsidered ripe to do so.140 The criteria included the following: the applicant must be a Nigerian or a Nigerian organization; must have no criminal conviction financial or otherwise; must satisfactorily de monstrate that he/she/it is not under any foreign influence whatsoever;141 and must provide an undertaking the licensed station would not be 137 Id 138 Id at 40-41. 139 Id at 41. 140 Id 141 Id
97 used for partisan politics.142 The license shall be valid for thre e years subject to renewal and can be revoked if in the opinion of the Commission the broadcast sta tion has been used in a manner detrimental to the national inte rest or where a practitioners co mplaint has been upheld after a public hearing143 These provisions of the NMCP were to subsequently inform both the statutory and regulatory enactments in the wake of the deregulation of broadcasting. The specifics of how the NMCP is reflected in the subsequent broadcasting st atutes and regulations will be discussed further in the next chapter. Dual Deregulation Commences The internal and external demands for reforms in the communications sector finally started yielding policy results in 1992. This is because in 1992, only two years after the adoption of the NMCP, the federal military government commenced deregulation of broadcasting by enacting Decree No. 38 (hereafter NBC Decree) This decree established the National Broadcasting Commission, which was charged with among othe r things the processing of applications for private broadcast licenses. Al so, it was in 1992 that the military government enacted Decree 75, which established the Nige rian Communications Communication (NCC). Under the Decree, the NCC was established to, among other things, facilitate the entry into markets for telecommunication services and facilities;144 and in general create a regulatory environment for the supply of telecommunications services and to promote fair competition and efficient market conduct.145 The Decree, which is discussed in the next chapter, spelled 142 Id at 42. 143 Id at 41. 144 NCC Decree S. 2(b). 145 Id. S. 2(a).
98 out, among other things, the structure and other functions and powers of the Commission, criteria for awarding licenses, and local content requirements in programming. While an examination of the NBC Decree in the next chapter shows that most of the recommendations of the Nationa l Mass Communication Policy were incorporated into the provisions of the Decree, especia lly with regards to the criteria for award of licenses, however, there was no similar telecommunications policy instrument at the beginning to guide the enactments for deregulating tele communications and subsequent attempts to adopt a national telecommunications policy were tortuous. Firs t, in the year 1998, the first National Telecommunications Policy was published. Alth ough the policy had been approved three years earlier, the political uncertainties of the time delayed its publication.146 Second, in 1999, the new civilian government inaugurated a committee for deliberations and production of a new policy, arguing that certain prescriptions contained in the [existent] Policy were outdated, overtaken by events or required further modifi cation, in order to be consistent with new developments and emerging industry trends both locally and internationally.147 The policy drafted by the Committee was approved by the governmen t and launched in October 1999. Finally, a year later, the same govern ment claimed that although the new telecommunications policy had been well-receiv ed, certain prescriptions needed fine-tuning during the course of implementation.148 Therefore, in February 2000, the government, citing the need to promote the policy goals of total liberalization, competi tion and the private sector-led growth of the telecommunications sector,149 inaugurated a Telecommunications Sector Reform 146 FEDERAL REPUBLIC OF NIGERIA, NATIONAL MASS COMMUNICATION POLICY 2 (2000). 147 Id 148 Id 149 Id
99 Implementation Committee (TSRIC) to review an d fine-tune the existing telecommunications policy.150 According to the then Minister of Communication, Mohammed Arzika, who chaired the TSRIC, the policy review was informed by the new democratic environment that required wide consultations on policy issues and the need to be part of the current trend of globalization and convergence in the telecommunications industr y, Nigeria needs a more proactive policy that recognizes international best practices.151 The newly launched National Telecommunicatio ns Policy, which was completed in May 2000 and released in September 2000,152 stated that the overridi ng policy objective is the modernization and expansion of telecommunications services, which should also be efficient, affordable, reliable, and availabl e to all because that will enha nce national economic and social development, and integrate Nige ria internally as well as into the global telecommunications environment.153 The Policy set short term and medium te rm objectives to be achieved within 3 and 5 years respectively. Among the short term objectives was meeting and exceeding the ITUrecommended minimum teledensity of 1 telepho ne to 100 inhabitants, which meant adding 2 million fixed lines and 1.2 million mobile lines within 2 years.154 And among the medium term objectives of the Policy were providing a new regulatory environment that is sufficiently flexible to take into account new technological development and the international trend towards 150 Id 151 Id at 3. 152 Id 153 Id at 23. 154 Id at 23.
100 convergence;[and creating] the enabling environm ent, including the provision of incentives, that will attract investors and resources to achieve the objectives earlier stated.155 The Policy identified four main component s of the telecommunications industry as follows: federal government (responsible for enacti ng laws and ensuring overall development of the industry); the Ministry of Communications (formulating broad telecommunications policy and monitoring implementation and hosting th e National Frequency Management Council, NFMC);156 the NCC; and the telecommunications service providers. Section 3.1.4 of the NTP categor ically states that the en abling law establishing the NCC shall be reformed to ensure autonomy of the Commission. It shall provide for secured tenure for NCCs board members as well as ensure that the Commission: shall make its decisions regarding licensing, tariff regulation, interc onnection disputes, and any other matters directly affecting industr y operators, in an impartial and independent manner. It shall be guided by the overriding objectives of the National Telecommunications Policy, and co nsiderations of fairness, e quity, and transparency. Such rulings shall not be directly influenced by Government or private industry. All deliberations of the Commission shall be underta ken in a transparent manner, subject to the rights of operators to non-d isclosure of proprietary and competitively sensitive information. Parties affected by regulatory d ecisions, including opera tors, customers, and competitors, shall be afforded access to the Commissions proceedings and the right to submit opinions in support of th eir interests. Parties shall have the right to appeal such decisions through transparent admi nistrative and legal channels.157 Shortly after the release of th e NTP, the NCC commenced preparations for the auctioning of three GSM licenses which took place in January 2001 in the natio ns capital, Abuja.158 155 Id at 25-26. 156 Id at 29 (the NFMC, comprising the Ministry of Communication, NCC, National Broadcasting Commission Security Agencies, Ministry of Aviation, Ministry of Transport, and representative of licensed operators, is responsible for planning, coordination and bulk allocation of the radio frequency spectrum in the country Id 29). 157 Id at 32. 158 Darin Lee, Lessons from the Nigerian GSM auction 27 TELECOMMUNICATIONS POLICY 409 (2003).
101 Conclusion This chapter has discussed the transf orma tion of telecommunicati ons and broadcasting regulation in Nigeria from rest ricted government monopoly to the beginning of deregulation and market competition. The chapter surveyed the history of telephony and broadcasting in Nigeria and showed that both broadcasting and tele phony were introduced by th e British colonial government largely with the aim of furtheri ng its imperialistic obj ectives and the newly independent administration maintained the gove rnment monopoly of both sectors for various reasons. The chapter then discussed the increm ental reforms in the communications sector beginning with partial commercia lization in the 1980s throug h the implementation of the Structural Adjustment Program. It was shown in th e chapter that in addition to the internal and external factors that influenced or induced the communications sector reforms ranging from IMF/World Bank to the debate on national communi cations policy, technology also played a role in contributing to the need for reforms, especial ly broadcasting. This is because while it may be apt to conclude that international pressure and local agitations influenced and or informed the commencement of major reforms in the communicatio ns sector, a third factor may also be added the introduction of satellite broadcasting. During the mid to late 1980s, when IMF/Wo rld Bank were exerting pressures on Nigeria for economic liberalization and local financiers were making internal agitations for private broadcasting, another player emerged in the broadcasting environment: satellite broadcasting.159 Nigeria joined the global proliferation of satellite broadcasting in three ways. 160 First, through 159 Louise M. Bourgault, Satellite Television in Nigeria: A Case Study in Media Globalization, 77 J. OF DEV. COMM. 84 (1997). 160 Id at 77.
102 the use of dishes for reception of direct-to-home satellite broadcast.161 Thus, by 1992, satellite television reception dishes in Kano and Lagos, tw o of Nigerias three largest cities, were estimated to be in thousands.162 The second means of receiving satellite news is the local stations re-broadcasting or incorporation of satellite supplied news fr om organizations like CNN.163 And thirdly, by the transmi ssion of the satellite broadcast using the Multichannel Multipoint Distribution Service, known as wirele ss cable or MMDS, to subscribers for a monthly fee.164 Soon the utility of satellite broadcasting be came ambivalent because on the one hand they provided some high quality news programming165 and created a whole new industry with business entrepreneurs making a living from the manufacture, supply, and inst allation of satellite dishes and MMDS reception equipment.166 But, on the other hand, concerns were voiced about media imperialism and the cultural invasion of foreign broadcasts.167 Worse of all, many Nigerians involved with DBS were accused of copyright violations.168 The copyright violations eventually led to the blacklisting of Nigeria for not complying with copyright laws and not paying associated fees.169 It was even argued that in view of these violations and the increasing 161 Id 162 Id at 78. 163 Id 164 Id at 82. 165 Id at 85. 166 Id at 81-84. 167 Id at 74 & 78. 168 Id at 78. 169 Id at 84.
103 availability of locally fabricated satellite dishes, Nigerias communi cation environment was rendered chaotic.170 Thus, the need to restore order to the chaoti c situation is believed to have formed the basis for the commencement of reforms that w ould ensure that government may control DBS. Therefore, in addition to the in ternal and external factors iden tified earlier as influencing the commencement of communications regulatory refo rm, DBS technology may be added as another factor. This chaotic communications environment that contributed to the emergence of NBC has striking similarity with the commencement of electronic communications regulations in the United States. In the case of the United States, the Titanic tragedy of 1912, which was partly the result of the cacophony of unregulated electr onic communications, brought the urgency of regulation that resu lted in the creation of Federal Radio Commission, the precursor to todays Federal Communication Commission. In the case of Nigeria, the chaotic environment in the communications sector in the 1990s, especially w ith regards to satellite broadcasting, partly informed the need for a regulatory agency. But th is is where the similarity ends because while the RCA in United States evolved to become the FCC, which is responsible for regulating wire and wireless telecommunications as well as broadcasting and cable, the NBC remained a regulator of broadcasting and cab le only, separate from the NCC, which regulates wire and wireless telecommunications. Finally, while NITEL may have been an in efficient government monopoly, but some of the criticisms against the company are unfair. Although to a largely extent corruption and incompetence are to some extent responsible for the inefficiencies of the company in providing additional lines to deserving Nigerians, there is also the cost and cumbersomeness of laying 170 Onwumechili, Privatization of Electronic Media in Nigeria 7 HOWARD J. OF COMMUNICATIONS (1996).
104 down cable and other wireline infrastructures co mpared to that of providing towers and other infrastructures for provision of cellphone serv ices. Therefore, without making excuses for NITELs failure, it should be noted that it was not only corruption and in competence that were responsible for the stagnation in the provi sion and connection of lines by NITEL. The next chapter will examine the provisi ons of the Decrees establishing the two regulatory agencies, namely the National Broadcasting Commission and the Nigerian Communications Commission, and discu ss these agencies structures, pow ers, and operations.
105 CHAPTER 4 LEGISLATING REGULATORY REFORMS, AGENCIES ORGANIZ ATIONAL STRUCTUTE, AND THE IMPACT OF REFORMS ON THE COMMUNICATIONS ENVIRONMENT The last chapter examined the historical evol ution of the Nigerian communications sector from its colonial beginning to the commencement of reforms with the establishment of NBC and NCC as the broadcasting and telecommunications regulatory agencies respectively. This chapter will discuss the legal instruments establishing th e NCC and NBC and the organizational structure of these agencies and show how the Nati onal Mass Communication Po licy and the National Telecommunications Policy, which were adopt ed in 1990 and 2000 respectively, influenced legislation on the NBC and NCC respectively. Th e chapter will also examine the organizational structure and operational processes of these regulatory agencies. The chapter will also provide an overall assessment of the current environmen t of the communications sector in Nigeria by describing the changes in market structur es and providers of both broadcasting and telecommunications services since the reforms of the early 1990s and how these changes in the communications sector have affect ed the public in terms of the av ailability and use of varied communication services. Chapter five will end by describing the challenges that the NBC and NCC currently face in regulating Nigerian communications sector in order to achieve polices aimed at making services more wi dely available to the citizenry. Establishing Regulatory Agenci es: The Statutory Instruments In 1992, only two years after th e adoption of the NMCP but without any for mal national telecommunications policy, the federal military government commenced the deregulation of broadcasting and telephony by enacting two decrees : Decree No. 38 (hereafter the NBC Decree) and Decree No. 75 (hereafter the NCC decree), which established the National Broadcasting Commission and the Nigerian Communications Commission respectively. The decrees spelled
106 out the powers of the commissions, their composition, funding, and procedure for appointment and removal of the Commissioners. An extensive di scussion of the provisions of these decrees is necessary because, as Murray Weidenbaum rightly observed: [T]he process of regulation does not begin when a government agency issues a ruling. Rather, it starts much earlier, when Congre ss passes a law establishing a regulatory agency and gives it a mandate to issue rules governing some activity. The writing of the specific statute, which has been largely ignored by most organized efforts at regulatory reform, is usually the most important action in what is an extended rule-making process. Basic defects in the enabling legisla tion cannot be cured by the regu latory agency concerned or anywhere else in the executive branch.1 Fortunately, Nigerias re gulatory reform did not ignore the writing of specific statutes. Therefore, we shall now examine these statut es beginning with the pr ovisions of the NBC decree. The NBC Decree The National Broadcasting Comm ission was es tablished under Decr ee No. 38 as a body corporate2 that can sue and be sued3 and which has among other responsibilities the regulation and control of the broadcast industry.4 Other responsibilities of th e Commission were outlined by Section 2(1) of the NBC Decree as follows: (a) advising the government on NMCP particular ly on matters relating to broadcasting; (b) receiving and processing applications for li censes for broadcasting, cable services, DSB, and any other form of broadcasting; (c) recommending applications for licenses to the President th rough the Minister; (d) regulating and controlling the broadcast industry; (e) undertaking research and develo pment in the broadcast industry; (f) investigating complaints regarding contents and conduct of broadcasting stations; (g) upholding the principles of equ ity and fairness in broadcasting; (h) establishing a national br oadcasting code and setting st andards for broadcasting; and 1 Murray Weidenbaum, A new approach to regulatory reform 42 SOCIETY 46 (2005). 2 NBC Decree S. 1. 3 Id 4 Id S. 2(1d).
107 (i) promoting Nigerian indigenous cultures, moral and community life through broadcasting. Further, the NBC Decree also empowered the Co mmission to initiate and harmonize government policies on trans-border direct transmission and reception of broadcast in Nigeria5 as well as monitor broadcasting for harmful emissi on, interference and illegal broadcasting.6 Consequently, any operations or transmission of vision or sound by cable, television, radio, satellite, or any other medium of broadcasting7 must be done in accordance with the provisions of the Decree8 failure of which gives the Commission the power to apply sanction including revocation of license.9 The structure of the Commission comprises a Chairman,10 the Director General,11 and ten other members representing the following interests: law, business, culture, education, social science, broadcasting, public a ffairs, engineering, State Secu rity Service, and the Federal Ministry of Information and Culture.12 Members should be persons of integrity and knowledgeable about the broadcast industry or experienced and ca pable of contributing to the work of the Commission.13 The Chairman and all members of the Commission shall be appointed by the President and Commander-in-Ch ief on the recommendation of the Minister [of 5 Id. S. 2(l). 6 Id. S. 2(1m). 7 Id. S. 2(2). 8 Id. S. 2(2). 9 Id. S. 2(1n). 10 Id. S. 3(1a). 11 Id. S. 3(1c). 12 Id. S. 3(1b) (in the 1992 Decree there were only seven other members. The representatives of engineering, State Security Service and the Federal Ministry of Information and Culture were added by the Amendment Decree No. 55 of 1999). 13 Id S. 3(2).
108 Information].14 The Chairman and other members of the Commission, except the Director General, shall serve for a term of three years renewable only once.15 The Director General, who should be knowledgeable and experienced in broadcasting,16 serves as the Chief Executive17 of the Commission and holds office for five years in the first instance and for any further period as the President may determine.18 A member of the Commission may be removed from office by the President if the president is satisfied that it is not in the interest of the Commission or the interest of the public that the member should continue in office.19 Regarding the powers to grant broadcast licenses, the NBC Decree requires that the Commission should be satisfied that the applicant is a corporation registered in Nigeria and its majority shares is owned by Nigerians;20 the applicant is not applyi ng on behalf of any foreign interest;21 the applicant can comply with the object ives of NMCP regard ing electronic media;22 and the applicant can give undertaking that the licensed station shall be used to promote national interest, unity, and cohesion and that it shall not be used to offend the religious sensibilities or promote ethnicit y, sectionalism, hatred, and dissatisfaction among the peoples of Nigeria (emphasis in the original).23 14 Id. S. 3(3). 15 Id. S. 4(1). 16 Id. S. 5(3). 17 Id. S. 5(1). 18 Id. S. 5(5). 19 Id. S. 4(4). 20 Id. S. 9(1a). 21 Id. S. 9(b). 22 Id. S. 9(1d). 23 Id. S. 9(1e).
109 Although compliance with the requirements outli ned above does not entitle an applicant to broadcast license, the Commission shall no t unreasonably withhold the grant of license.24 However, the Commission shall not grant license to political parties or religious organizations.25 In granting license, the Commission is to take into consideration distribution of stations into rural, urban, commercial, and other categories;26 and it is illegal for any person to have controlling shares in more th an two television stations.27 The Commission is empowered to prescribe the appropriate fee payable for a license,28 and the license is valid for five years29 and for one station only.30 Regarding local content, the Decree provided that licensees program ming shall not be less than 60 per cent local [content] and not more than 40 per cent foreign [content] for radio and television and not less than 20 per cent local [content] or more th an 80 per cent foreign [content] for cable satellite retransmission.31 On the financing of the Commissions operations, the NBC Decree mandated the Commission to establish a nd maintain a fund from which shall be defrayed all expenditure incurred by the Commission32 including the cost of administration,33 payment of salaries and other remunerations.34 Money to be paid into the fund includes fees and 24 Id. S. 9(3). 25 Id. S. 10(a-b). 26 Id. S. 9(4c). 27 Id. S. 9(5). 28 Id. S. 13(e). 29 Id. Third Schedule S. 12(1). 30 Id. Third Schedule S. 12(4). 31 Id. Third Schedule S. 12(5b). 32 Id. S. 14(1). 33 Id. S. 15(a).
110 levy the Commission charges broadcast stations,35 grant from state or federal government,36 and money accruing from assets of the Commission.37 An examination of the NBC Decree shows th at most of the recommendations of the National Mass Communication Policy (NMCP) were incorporated into the provisions of the Decree especially with regards to the criteria for awarding br oadcast licenses. For example, although the NMCP recommended that the time was not ripe for private owne rship of electronic media, it however provided the criteria for granting such licenses when the time is considered ripe to do so.38 Under the criteria the applicant must be a Nigerian or a Nigerian organization without criminal conviction (fin ancial or otherwise), a satisf actory demonstration that the applicant is not under any foreign influence whatsoever.39 The applicant must also provide an undertaking that the licens ed station would not be used for partisan politics.40 The license shall be valid for three years subject to renewal and can be revoked if in the opinion of the Commission the broadcast station ha s been used in a manner detrimental to the national interest or where a practitioners complain ha s been upheld after a public hearing41 Compare these recommendations with the provisions of Section 9( 1a-e) of the decree and the only contrast will be the decree requiring the applicant to be a co rporation with majority Nigerian shareholding rather than an individual or a corporation wholly owned by Nigerians. Another slight difference 34 Id. S. 15(b). 35 Id. S. 14(2a). 36 Id. S. 14(2b). 37 Id. S. 14(2d). 38 FEDERAL REPUBLIC OF NIGERIA, NATIONAL MASS COMMUNICATION POLICY 41. 39 Id. at 41. 40 Id. at 42. 41 Id. at 41.
111 between the NMCP and the NBC Decr ee is the decree, rather than requiring licensees not to use their license for partisan politics, requires them to promote nati onal interest and prohibits them from offending the religious sens ibilities or promoting ethnic ity, sectionalism, hatredamong the people of Nigeria.42 Yet, the NMCP recommendation fo r prohibiting use of stations for partisan politics might have found some expressi on in the provision against granting licenses to political parties.43 The duration of the license is anothe r issue for which the NBC Decree differs from the NMCP recommendation because the Decree provides for five years against NMCPs recommendation of three years. One major provision of the NBC Decree that ma y surprise advocates of the freedom of expression and or freedom of religion is the provision of section 10(a), wh ich stated that The Commission shall not grant a licen ce to a religious organization.44 This provision is seemingly in contradiction of section 38(1) of the Constitution which provides that: Every person shall be entitled to free dom of thought, conscience and religion, including freedom to change his religion or belief, and freedom (either alone or in community with others, and in public or in private) to manifest and propagate his religion or belief in worship, te aching, practice and observance. Consequently, it may be apt to discuss what coul d have informed this provision with a view to understanding its possible justificat ion in the context of Nigeria s historical experience with religious expression. Regulating Religious Expressions on the Airwaves Nigeria is not only the most populous country in Africa, but it is said to also have the larges t concentration of Muslims on the continent and it even has more Muslims than any Arab 42 Id. S. 9(1e). 43 Id. S. 10(b). 44 Id. S. 10(a)
112 country, including Egypt.45 With an estimated population of 130 million and 40% of whom are Christians, Nigeria then has more Christians that any African country including Democratic Republic of Congo and Ethiopia. Thus, the country can be said to have the largest concentration of Muslims and Christians w ithin the same country on the African continent. Moreover, according to a BBC survey,46 Nigerians have been found to be the most religious people in the world with 100% saying they believe in God, 95% saying they pray re gularly, and 95% saying they would die for their belief. However, Nigerias religious commitments long predate the BBC Survey. According to one of the eminent Nigerian historians, J.F.A. Aj ayi, the two monotheistic religions of Islam and Christianity laid the foundation for the current Nigeri an nation state.47 Of the five events that Ajayi identified as the milestones on Nigerias journey to nationhood, the fi rst two are associated with Islam and Christianity respectively, namely: The Sokoto Jihad and Samuel Ajayi Crowthers Mission.48 The Jihad, according to Ajayi, not only brought a larg e area of Nigeria together, but it also developed the idea of a cosmopolitan state which demands loyalty to something outside parochial loyalties.49 Crowthers missionary activities also contributed not only to educating Nigerians and reducing some Nige rian languages to writing for the first time, it also taught different trades and skills to Nigerians beyond kith and kin who became bounded and who were talking about star ting a new nation. Thus, in Ajay is conclusion, while the Jihad 45 ALI A. MAZRUI, A TALE OF TWO AFRICAS: NIGERIA AND SOUTH AFRICA AS CONTRASTING VISIONS 152 (2006). 46 BBC News, Nigeria leads in religious belief (February 26, 2004). available at : http://news.bbc.co.uk/2/hi/programmes/wtwtgod/3518375.stm 47 J. F.A. AJAYI, MILESTONES IN NIGERIAN HISTORY 2. ( 1980). 48 The rest events identified by Ajayi are Amalgamation of Northern and Southern Protectorates, enactment of Richards Constitution, and the Civil War. Id. at 3. 49 Id at 12.
113 was the first stage in our journey to nationhood,50 Crowther and his mission took Nigeria one step further on the journey to nationhood.51 Since the Jihad was largely in the North and Crowthers mission was largely in the South, it can be inferred why today the North is predom inantly Muslim and the South is predominantly Christian although there is a sign ificant Christian population in th e Central Nigeria and a large number of Muslims (some say a majority) in the Southwest. Thus when Britain amalgamated the North and South in 1914 into one nation, it institu ted a policy which saw the country divided into three regions: North, East, and West with Lagos as the capital territo ry. At independence in 1960, a federal political structure was adopted in view of the re gionalism and geocultural zones with the aim of accommodating diversity and facilitating conflict resolution.52 It has been observed that in the First Repub lic (1960-1966) it was regional, rather than religious, concerns that dominated national politics and although re ligion had some influence but it was not significant.53 One aspect of national policy where the infl uence of religion was apparent during the First Republic was broadcasting, as evident from the composition of the advisory committees of the boards of the Nigerian Broadcasting Corporation.54 As at March 31, 1964, the Corporation had four Boards: the Board for the Headquarters a nd one for each of the three regions. Each of these four boards has the following advisory committees: Headquarters: Programs, Commercial Broadcasting, Muslim Religion (13 members), a nd Christian Religion (1 4 members); Northern 50 Id at 13. 51 Id at 21. 52 JOHN PADEN, MUSLIM CIVIC CULTURES AND CONFLICT RESOLUTION: THE CHALLENGE OF DEMOCRATIC FEDERALISM IN NIGERIA 7 (2005). 53 J. ISAWA ELAIGWU, THE SHADOW OF RELIGION ON NIGERIAN FEDERALISM: 1960 1993 3 (1993). 54 IAN MACKAY, BROADCASTING IN NIGERIA 151 (1964).
114 Region: Education, Muslim religion (9 members) and Christian religion (7 members); Western Region: Education, Christian re ligion (8 members), and Muslim religion (8 members); in the Eastern region there was only Christian religion advisory committee with six members.55 In short, there were Muslim and Ch ristian religious advisory comm ittees for the NBC Headquarters and the Northern and Western regions as well as a Christian advisory committee for the Eastern region. But it was not only in the advisory committees that the influence of the two religions was apparent on broadcasting. In programming of NB Cs headquarters there were religious programs for Muslims and Christians.56 In Northern Nigeria, Sheikh Abubakar Gumis preachings on the radio and television are becoming popular and controversial. In Southern Nigeria the use of media for evangelism was said to have been started by Bishop Ben Idahosa who began television broadcast in 1974.57 Subsequently, there was an explos ion of religious programs when commercialization in broadcasting enabled many preachers to buy air time on radio and television to deliver their messages.58 It should be noted that th is was at a time when all broadcasting stations were owned and operated by the government, prior to the commencement of deregulation of broadcasting in 1992. However, between the days when broadcasting was monopolized by government and the commencement of broadcast de regulation, there emerged an increased religiosity among 55 Id at 151-2. 56 Id at 34. 57 Walter Ihejirika, Media and fundamentalism in Nigeria 2 MEDIA DEVELOPMENT (June 6, 2005), available at at: http://www.wacc.org. uk/wacc/regional_associations/africa/african_a rticles/media_and_fundamentalism_in_nigeria 58 Id .; see also Rosalind Hackett, Managing or Manipulating Religious Conflict in the Nigerian Media in MEDIATING RELIGION: CONVERSATIONS IN MEDIA, RELIGION, AND CULTURE 57 (Jolyon Mitchell and Sophia Marriage, eds., 2003).
115 Nigerians. According to Larkin and Meyer, incr easing religious revitalization in Nigeria in the last two decades has been characterized by Pent ecostal evangelism and reformist Islam both of which are said to be fiercel y outspoken religions between wh om there is deep enmity and whose disagreements and mutual suspicion ha ve often degenerated in to violent conflict.59 Although others have argued that mo st of the conflicts sometimes perceived as religious are in fact ethnic or political conflicts60 or the results of socio-economic crisis brought about by harsh and unjust government economic policies impos ed on the country by the IMF and World Bank.61 Many violent conflicts o ccurred (especially in Northern Ni geria) in the years before the commencement of deregulation of broadcasting, l eading one scholar to characterize the years 1980s-1990s as The Decade of Intolerance.62 Similarly, it has been reported that between the late 1980s and early 1990s, conflic ts between Christians and Muslims or between Muslim sects have led to the death of not less than 3,000 people.63 For the purposes of this chapter and in unders tanding the rationale for the NBC Decrees provision, we may ask: what role are the medi a playing in these conf licts? Three roles are ascribed to the media in these conflicts in what is seemingly a continuum from starting the conflict to escalating the conflic t and managing the conflict. On at least three occasions the media were said to have been responsible for starting a conflict. These include: a 1991 Fun Times article alleging that Jesus and Prophet Mu hammad had affairs with prostitutes; a 2002 59 Brian Larkin and Bright Meyer. Pentecostalism, Islam, and Culture: Ne w Religious Movements in West Africa in THEMES IN WEST AFRICAS HISTORY 286 (Emmanuel Ayeampong, ed., 2006). 60 ELAIGWU, THE SHADOW OF RELIGION ON NIGERIAN FEDERALISM: 1960 1993 supra note 53, at 22. 61 Sabo Bako, World Recession and the Growth of Religious Intolerance in Nigeria in RELIGION AND PEACE IN MULTI-FAITH NIGERIA 172 (Jacob Olupona, ed., 1992). 62 ELAIGWU, THE SHADOW OF RELIGION ON NIGERIAN FEDERALISM: 1960 1993 supra note 53, at 11. 63 THE ECONOMIST, The Call of Islam August 21, 1993, At pp. N12-13.
116 ThisDay article opining that Prophet Muhammad w ould have married one of the Miss World contestants; and the Danish newspaper, Jyllands-Posten publication of cartons of Prophet Muhammad.64 With regards to medias role in escalati ng conflict, it has been observed that in 1986, medias sensationalized reports of a inter-religious riot in the remote city of Kafanchan led to the breakout of riots in other places.65 But the media are also said to ha ve been used to calm tensions and appeal for peaceful coexistence and it has al so been revealed that during some religious tensions the media have refused to publish in flammatory publications emanating from Muslim and Christian groups.66 Thus, while the media have varied roles in re ligious conflicts, it may be inferred, as John Paden67 observed, that they have more often been a source of conflict and their reportage and photos (sometimes doctored) of gross interethni c (or interreligious) viol ence have precipitated panic and flight, and more violence.68 Moreover, Toyin Falola69 also observed that hate literature and verbal aggre ssion are now prevalent among Mu slims and Christians through sermons, speeches, writings in schools, places of worship, public arena, and colleges.70 These verbal aggressions lead to more or less a permanent state of warfare of some kind, and such 64 BBC NEWS, Nigeria cartoon protests kill 16 (February 19 2006), available at : http://news.bbc.co.uk/2/hi/africa/4728616.stm 65 ROMAN LOIMEIER, ISLAMIC REFORM AND POLITICAL CHANGE IN NORTHERN NIGERIA 296 (1997). 66 Hackett, Managing or Manipulating Religious Conflict in the Nigerian Media, supra note 58 at 61, citing Matthew H. Kukah, Public Perceptions of the Press in Nigeria in JOURNALISM IN NIGERIA: ISSUES AND PERSPECTIVES 175 (O. Dare and U. Adidi, eds., 1996). 67 PADEN, MUSLIM CIVIC CULTURES AND CONFLICT RESOLUTION, supra note 52. 68 Id. at 179. 69 TOYIN FALOLA, VIOLENCE IN NIGERIA: THE CRISIS OF RELIGIOUS POLITICS AND POPULAR IDEOLOGIES 246 (1998). 70 Id at 247.
117 symbolic violence sometimes set the stage fo r physical assaults or acting as postscript for physical violence.71 Falola concluded that unfortunately, th e rhetoric of violence has penetrated the popular culture from theatre to radio to television where humo r is used malic iously and to suggest that tolerance should not be permanent.72 The question therefore is how to balance the constitutionally guaranteed freedom of religion and its propagation73 and freedom of expression74 with the constitutional provision that the security and welfare of the people shall be the primary purpose of government.75 Since the aim of this chapter is neither to provide detailed discussion of the cases where medias reportage is said to have started or exacerbated religious conflicts nor the examination of the provisions of Nigerias Constitution, criminal laws, and media regulations vis--vis re ligious expression and how those provisions sought to control possible inc itement of religious hatred which could lead to religious violence, suffices it to say that such project me rits further study. Whereas the NBC Decree has been shown to reflect the provisions of the National Mass Communication Policy either in letter or in spir it or both, the same thing cannot be said about the Nigerian Communications Commission Decree, which was enacted also in 1992 as the statutory instrument for telecommunications sector regulation. The provisi ons of the Decr ee shall now be examined as well as the subsequent developments that led not only to the adoption of a National Telecommunications Policy but also the passage of a new statutor y instrument for the regulation of the telecommunications sector. 71 Id 72 Id ., at 262. 73 CONSTITUTION OF THE FEDERAL REPUBLIC OF NIGERIA 1999 S.38(1). 74 Id S.39(1-3). 75 Id S.14(2b).
118 The NCC Decree In 1992, the then m ilitary regime enacted Decree 75 of 1992, which established the Nigerian Communications Commun ication (NCC). Under the Decree, the NCC was established as the a body corporate with perpetual succession and a common seal, and may sue and be sued in its corporate name.76 The Commissions objectives, among other things include the creation of a regulatory environment for the supply of telecommunications servic es and the promotion of fair competition and efficient market conduct.77 Further, the NCC is expected to facilitate entry into telecommunications market s both for services and facilities,78 as well as establish technical standards79 and ensure the optimal use of teleco mmunications facilities in Nigeria; all these with due consideration for the rights of the licensees and the public interest.80 The NCC Decree spelled out the functions a nd powers of the Commission to include: 1. technical and economic regulation of the priv atized sector of th e telecommunications industry81 2. ensuring quality of telecommunications services82 3. promoting competition in the telecommunications sector83 4. receiving and investigating complaints from a nd arbitration of disput es between licensees and other participants in th e telecommunications industry84 76 NCC Decree S. 1(1). 77 Id S. 2(a). 78 Id S. 2(b). 79 Id S. 2(h). 80 Id S. 2(j). 81 Id S. 4(a). 82 Id S. 4(b). 83 Id S. 4(f). 84 Id S. 4(k-l).
119 5. protection of public interest85 6. developing performance standard s and indices with due regard to the best international performance indicators and Nigerian conditions86 7. monitoring and reporting to the Minister on th e charges and performa nce of licensees and others; 8. issuance of telecommunications licenses87 and 9. monitoring and enforcing the conditions of the licenses88 Beside these regulatory powers, the Commissi on also has operational powers including the power to require any person to appear before it or any of its committee to discuss any matter, give evidence, or produce any document that th e Commission deems necessary for the effective discharge of its duties.89 In addition, the Commission has th e power to do anything which, in the opinion of the Commission, is ca lculated to facilitate the carry ing out of the functions of the Commission;90 and, with the Ministers approval, it may make regulations generally for the purpose of giving effect to th e provisions of the Decree.91 Appointment of NCCs Comm issioners is to be made by the President on the recommendation of the Minister.92 The Commission will consist of a chairman, executive vice chairman of the Commission, and eight other Co mmissioners with requis ite experience in any one or more of the following, commerce, consum er affairs, financial matters, industry, law, 85 Id S. 4(n). 86 Id S. 4(p). 87 Id S. 4(r). 88 Id S. 4(s). 89 Id S. 5(e). 90 Id S. 5(h). 91 Id S. 26. 92 Id S. 3(1).
120 management, public administration, technol ogy, and telecommunications engineering.93 The executive vice-chairman shall be the chief executive of the Commi ssion[and] shall be a person possessing sound knowledge of and ability in the organisation and management of telecommunications matters.94 The Commissioners shall serve for four years renewable only once and may resign at any time by no tice addressed to the President.95 Any Commissioner may be removed by the President at any time if the president is satisfied that it is not in the interest of the Commission or the interest of the public that the member should continue in office [p]rovided that not more than two thirds of th e members of the Commission shall be removed at any one time.96 The Federal High Court is conferred with th e jurisdiction for the trial of offenses and violations as well as all suits for the enforcement of any liability or duty arising from the Decree and regulations made by the Commission.97 The Commission is required to conduct an investigation about any c onduct that violates or is to likely vi olate the provisions of the Decree and upon proper showing of facts by the Com mission [to the High Court] a permanent or temporary injunction or restrain ing order may be granted. the Federal High Court may issue a writ of mandamus commanding any person to comp ly with the provisions of the Decree. The Commission is also required to prepare and submit to the Minister an annual report on its activities including report on its audited accounts as well as th e Auditor-Generals report.98 93 Id S. 3(1a-c). 94 Id S. 3(3-4). 95 Id S. 9(1-2). 96 Id S. 9(4). 97 Id S. 24. 98 Id S. 35.
121 The Commission is required to prepare and maintain a register99 containing information such as license issued, details on holders of licenses and permits, approved type of customer equipment, cancellations and revoca tion of licenses and permits, etc.100 The register to be prepared and maintained by the Commission should be available and open to the public for inspection upon the payment of a token fee to be prescribed by the Commission from time to time.101 On financing the Commission, the Decree provi ded that the Commission shall establish and maintain a fund from which shall be defrayed all expenditures incurred by the Commission;102 and apply the proceeds of the fund to the cost of administration, reimbursing members of the Commission, payment of salari es or other remunera tions, maintenance of Commissions property, inve stment, and any functions of the Commission.103 Money that shall be paid and credited into the fund include grant from federal or a state government; all subscriptions, fees, and charges payable to the Comm ission; gifts, loans, a nd grant-in-aid; and all assets that may accrue to the Commission.104 In each year, the Commission is required to submit to the Minister an estimate of its expe nditure and income for the following year.105 While this outline of the NCC Decree seem ed to project the Commission as an independent regulatory agency, but, as stated in chapter three, in the year 2000, a newly launched 99 Id S. 22(1). 100 Id S. 22(1a-g). 101 Id S. 22(2). 102 Id S. 31(1). 103 Id S. 31(3). 104 Id S. 31(2a-d). 105 Id S. 34.
122 National Telecommunications Policy106 emphatically recommended that the enabling law establishing the NCC shall be reformed to ensure autonomy of the Commission. 107 The new law, according to the recommendation of the new NTP, shall provide for secured tenure for NCCs board members 108 as well as ensure that the Commi ssions decisions and actions are not only transparent and not directly influenced by the government or private sector but also that both customers and operators have access to, and the right of participating in the Commissions proceedings and the right for both administrative and judicial appeal against the Commissions decisions.109 In 2003, the National Assembly, perhaps en couraged by the governments new NTP, enacted the new National Comm unications Commission Act (here after the Act), which was assented to by the president on July 8, 2003.110 There are two reasons why an elaborate discussion of the new legislation is necessary. First, it has repealed the existent legislations, i.e. Decree No. 75 of 1992 and Decree No. 30 of 1998;111 therefore, it is the current law regulating telecommunications in Nigeria. Secondly, it was passed following the adoption of the new national telecommunications polic y, which recommended the reform of the regulatory agency in order to make it (the agency) more independent and transparent in its functions. Therefore, an extensive examination of the new law will enable us to understand whether or not the expectations of NTP have been met by the new law. 106 FEDERAL REPUBLIC OF NIGERIA, NATIONAL TELECOMMUNICATIONS POLICY 3. 107 Id. at 32. 108 Id. at 32. 109 Id. at 32. 110 SCHEDULE TO THE NIGERIAN COMMUNICATIONS BILL 2003 (the Act was passed by the House of Representatives on March 12, 2003 and the Senate on May 27, 2003). 111 Nigerian Communications Act, S. 150 (2003).
123 A New Communications Act The new statute, which is known as Nige rian Communications Act, has among its specific ob jectives the creation of an eff ective, impartial and independent regulatory authority.112 Other legislative intents of the Act in clude: the promotion and implementation of the national communications or telecommunications policy;113 the promotion and provision of modern, universal, efficient, re liable, affordable and easily accessible communications services and the widest range th ereof throughout Nigeria;114 and encouraging local and foreign investments in the Nigerian communications indu stry and the introductio n of innovative services and practices in the industry in accordance w ith international best practices and trends.115 The Act conferred on the NCC the responsibility for the regulation of the communications sect or in Nigeria116 and delegated many functions to the Commission including the followings: gran ting and renewing communications licencesand monitoring and enforcing compliance with licence te rms and conditions by licensees;117 fixing and collecting fees for the licenses;118 proposing and enforcing technical specifications and standards for communications equipment in Nigeria;119 representing Nigeria at inte rnational organizations and fora on communications regula tions and related matters.120 Further, the Act empowered the 112 Id S. 1(b). 113 Id S. 1(a). 114 Id S. 1(c). 115 Id S. 1(d). 116 Id S. 3(1). 117 Id S. 4(e). 118 Id S. 4(g). 119 Id S. 4(l). 120 Id S. 4(v).
124 Commission to conduct mediation and arbitratio n of complaints, disputes, or objections by subscribers, operators, and other stakeholders.121 Other functions of the NCC outlined by the Act are facilitating investments and entry into the Nigerian communi cations market; protection of consumers against unfair practices; promoting fair competition in the communications sector. Perhaps, the general function of the Commissi on was summarized in the two broad provisions vesting the NCC with the gener al responsibility for economic a nd technical regulation of the communications industry122 and the implementation of the Governments general policies on communications industry and the ex ecution of all such other functi ons and responsibilities as are given to the Commission unde r this Act or are incide ntal or related thereto.123 The Act established a Board of Governance ( known as the Board) entrusted with the responsibility for oversight a nd charged with the administration of the affairs of the Commission.124 The Board consists of 9 Commissioners made up by a chairman, a chief executive who shall also be the Executive Vi ce Chairman, 2 Executive Commissioners, and 5 non-executive Commissioners. All the commissioners are appointed by the President subject to the confirmation by the Senate.125 The commissioners must be Nigerians126 of recognized standing with qualification and experience in one or more of the following areas: finance/accounting, law, telecommunications engineering, consumer affairs, economics, 121 Id S. 4(g). 122 Id S. 4(w). 123 Id S. 4(t). 124 Id S. 5(1). 125 Id. S. 8(1). 126 Id. S. 7(2a).
125 information technology, engineering generally, and public administration.127 The commissioners serve for 5-year term which may be renewed no more than once.128 The president may remove or suspend a commissioner when the commissioner is found not to have been qualified for appointment129 or the commissioner is suspended or disqualified by the profession based on which he/she was appointed;130 the commissioner is demonstrably unable to effectively perform the official duties;131 the commissioner was absent from five consecutive meetings without the Chairs permission and is unable to show good reason;132 the commissioner is found guilty of serious misconduct with regards to official duties;133 or the commissioner breached the Conflict of Interest Rules outlined by the Act.134 Before the removal or suspension of a commissioner, the president shall give written notice with reasons135 about his intention and the commissioner shall be given no less than 14 days to make written submission to the president.136 In making a final decision about the commissioners suspension or removal, the president shall take into 127 Id. S. 7(1). 128 Id. S. 8(5). 129 Id. S. 10(1a). 130 Id. S. 10(1e). 131 Id. S. 10(1b). 132 Id. S. 10(1c). 133 Id. S. 10(1d). 134 Id. S. 10(1f). 135 Id. S. 10(2). 136 Id. S. 10(3).
126 consideration the commissioners submission.137 In replacing any Comm issioner, the provisions requiring the Senate confirmation applies.138 The Act provided that the Minister of Comm unications, in the course of discharging his functions and in relating with th e NCC shall at all times ensure that the independence of the Commission, in regard to the discharge of its functions and operations under this Act, is protected and not compromise d in any manner whatsoever.139 Although the Act gave the Minister the responsibility fo r the formulation of general policy for the communications sector,140 however, it requires the Minister to not only cause the Commission on his behalf to first carry out a public cons ultative process on the propos ed policy formulation or [m]odification,141 but also requires that the Minister sh all take into consideration the findings of the consultative process in formulating the policy.142 In discharging all its functions and ex ercising its powers, the Act charged the Commission to do so in a manner th at is efficient, effective, nondiscriminatory, and transparent at all times.143 This requirement was emphasized with regards to crucial functions of the Commission such as formulati ng the guidelines for, and th e issuance of communications licenses.144 The Act made it mandatory upon the NCC to hold an inquiry prior to making any 137 Id. S. 10(4). 138 Id. S. 11(2). 139 Id. S. 25(2). 140 Id. S. 23(a). 141 Id. S. 24(1). 142 Id. S. 24(2). 143 Id S. 4(2). 144 Id. S. 33(3) provides inter alia that The Commission shall at all times be guided in the formulation of licensing procedures, issuance of communications licences and preparation of licence conditions and terms, by the principles of and consideration for transparen cy, fairness and non-discrimination S. 33(3b).
127 regulation145 and the Commission is required to take into consideration the findings of the inquiry in making the final regulation.146 Same requirements apply when modifying or revoking the regulations.147 But in formulating guidelines the Co mmission is not required to hold an inquiry, although if it finds it necessa ry to do so, then it shall take into consideration the findings in making the guidelines.148 If the NCC decides to hold a publ ic inquiry it shall publish a notice in the manner it deems appropriate149 on the period and subject-matter of the inquiry. Members of the public shall be given at least 21 days to make submissions on the matter150 and the Commission shall consider any submi ssions received within the time limit.151 The Commission may decide to hold an inquiry in private only wh en it is satisfied about the confidentiality of evidence involved or concerned with implications for the administration of the Act.152 Also, the NCC may prohibit or restrict the publication of evidence gi ven in public inquiry if it determines that the information is of confidential nature.153 An aggrieved person whose int erest is adversely affected154 by any decision of the Commission155 may request for a statement of reas ons for the decision and the NCC shall provide a copy of a statement of reasons for the decision and any relevant information taken 145 Id. S. 71(1). 146 Id. S. 71(2). 147 Id. S. 72(2). 148 Id. S. 71(3). 149 Id. S. 58(1). 150 Id. S. 58(1a-e). 151 Id. S. 58(3). 152 Id. S. 59(1). 153 Id. S. 59(2). 154 Id. S. 86(1). 155 The NCC Act states that a decision of the Commission includes any action, order, report, direction. S. 86(4).
128 into account in making the decision.156 The aggrieved person has 30 days within which he/she may seek for review of the Commissions decisi on and the Commission should within sixty days of the receipt of such submission finish the review of the earlier decision and inform the aggrieved person in writing of its final decision.157 However, the Commissi on is not obligated to divulge information that is of confidential nature, may prejudice fa ir trial, or involves personal information of any individual.158 Judicial review is made available subj ect to exhausting the Commissions review159 in which case the aggrieved person may file act ion with the Federal High Court which has exclusive jurisdiction over all matters, suits, cas es, howsoever arising out of or pursuant to or consequent upon160 The Commission was given the power for gathering information161 and the responsibility of disseminating of information including a requirement that the Commission publish information regarding its licensing procedures st ating persons eligible for license, selection process, tender, auction, competitive bidding, etc.162 Also made mandatory upon the NCC is the publication of an annual report on matters rela ting to administration of the Act, industry indicators and statistics, availability, adequacy, and quality of service, and tariff rates and 156 Id. S. 86(2). 157 Id. S. 87(4). 158 Id. S. 86(3a-c). 159 Id. S. 88(1-3) 160 Id. S. 138. 161 Id. S. 64(1)(a-b). (providing that the Commission has the power to demand from any relevant person information including but not limited to accounts and records or any document that is relevant to the exercise of the Commissions powers and functionso r any evidence which the Commission has reason to believe is relevant to the exercise of the Commissions powers and functions under this Act or its subsidiary legislation). 162 Id. S. 33(1-2).
129 charges.163 The Commission shall publish such repo rts in the manner it deems appropriate, provided that it is made publicly available.164 The Commission must maintain registers in electronic and physical formats on matters requiring registration a nd publish guidelines in regard to the registers stating among ot her things access processes and procedures for members of the public.165 Members of public may access and make copies from the register upon payment of any fees set by the Commission.166 Section 17 of the Act empowers the commissi on to establish and maintain a fund from which all expenditures incurred by the Commission sh all be defrayed. Sources of monies for the fund include appropriations from the National Assembly,167 fees charged by the Commission,168 assets of the Commission,169 loans, grants and gifts.170 The only fee that is not paid into the Commissions fund is all monies accr uing from the sale of spectrum,171 which has to be remitted into the nations Consolidated Revenue Fund.172 The commission is empowered to apply the proceeds of its Fund for the payment of its administrative and operating costs, salaries, wages, fees and other financial entitle ments of its staff and Commissioners;173 meeting capital 163 Id. S. 89(1-3). 164 Id. S. 89(4). 165 Id. S. 68. 166 Id. S. 69. 167 Id. S. 17(2a). 168 Id. S. 17(2b). 169 Id. S. 17(2d). 170 Id. S. 17(2c). 171 Id. S. 17(3). 172 Id. S. 17(3). 173 Id. S. 19(3)(a-b).
130 expenditure such as acquisition or ma intenance of property or equipment;174 making investment;175 and expending for any other functions of the Commission.176 Annually, the Commission is required to pre pare and present to the Nationa l Assembly through the President for approval, a statement of estimated income and expenditure for the following financial year.177 NCC Decree vs. Nigerian Communications Act At this ju ncture, it is apt to examine the provisions of the Act in order to compare and contrast it with the provisions of the NCC Decree as well as s ee the extent to which the Act responds to and or incorporates the recommenda tions of the new National Telecommunications Policy. A quick comparison of the provisions the erstwhile law (the Decree) with the new Act indicates that there are about four major differences with regards to the structural nature of the Commission. These four major differences are wi th regards to appointment and removal of commissioners; who the Commission is answerable to; Commissions adjudicative and enforcement powers; and access to and transpar ency of the Commissions rulemaking and other procedures. Whereas the Decree confers on the president the power to appoint and remove Commissioners at any time if the president is satisfied that it is in the interest of either the Commission or the public to do so, but the new Ac t restricts the president from such whimsical action not only by providing that the appointme nt of Commissioners is subject to the confirmation of the Senate but by also specif ying the exact bases upon which a Commissioner may be removed and even furthe r requiring that such a Commi ssioner be given notice of the 174 Id. S. 19(3)(c). 175 Id. S. 19(3)(d). 176 Id. S. 19(3)(e). 177 Id. S. 19(1).
131 presidents intention in writing and an opportunity to respond. These new provisions seem to have secured the tenure of the Commissioners as recommended by the NTP. A second major departure from the Decree in the Act concerns who the Commission is answerable to. In the Decree the Commissioner was firmly under the Ministers directive but the Act requires the Commission to prepare and subm it the reports of its activities, anticipated budgetary expenditure, and audited accounts to the National Assembly through the President. Even on the broader issue of fo rmulating national policies for th e telecommunications sector for which the Minister is given re sponsibility, the new Act requires him to seek and consider the input of the Commission and to avoid doing anything in the pr ocess that will undermine the independence of the Commission. By making th e Commission answerable to the National Assembly, the independence of the Commission has been greatly enhanced and the potential political influence that may be exerted through the Minister may be minimized. The third major difference between the Decree and the Act is on the adjudicative and enforcement powers of the Commission. In the Decree, the Commission only conducts investigations on activitie s of regulatees but the High Court gran ts injunctions and other orders to enforce the findings of the Commission. However, under the Act, the Commission can make rules and stipulate penalties for offenses and Se ction 90 vested the Commission exclusively with the enforcement of compliance by all persons with such regulations and other competitive laws and regulations relating to the Nigerian communications market. Further, the Commission is empowered to resolve disputes be tween parties that are subject to the provisions of the Act on matters relating thereto. This also indicates the greater autonomy granted the Commission in line with recommendations of the NTP.
132 Finally, a major departure from the Decree and in what is apparently an attempt to make the Commissions activities transparent and acce ssible to stakeholders, the Act requires the Commission to hold public hearings before making a rule and to give members of the public an opportunity to make submissions that the Commi ssion is required to ta ke into cognizance in enacting the rules. Further, the Commission is required to publish the evidence which formed the bases for the rulemaking. By making these provisions in the new Act in addition to retaining the right of those aggrieved to seek judicial of the Commissi on from the Decree, it may be concluded that a high level of transparency and judicial overs ight have been brought to the activities of the Commission. In general, it may be safe to say that the new Communications Act was influenced by the recommendations of the Na tional Telecommunications Policy in similar, though not necessarily the ways that the Nati onal Mass Communication Policy influenced the National Broadcasting Commission Decree. Agencies Organizational Structure But beyond the letters of the law, there is the need to understand the organizational structure of these regulatory agencies not onl y because bureaucratic st ructure indicate s the capacity and influences the organizations institutionalization in the larger polity178 but also because in developing countries li ke Nigeria, bureaucratic structure has been found to be a major determinant of the performance of agencies in such countries.179 First, let us consider the organizational structure of the NCC. 178 See generally Morten Egeberg, How Bureaucratic Structure Matters: An Organizational Perspective in HANDBOOK OF PUBLIC ADMINISTRATION 116 (B.G. Peters and J. Pierre (eds., 2003). 179 Seee.g., James E. Rauch and Peter Evans, Bureaucratic Structure and Bureaucratic Performance in less Developed Countries 75 J. OF PUB. ECONOMICS 49, 49 (2000).
133 NCCs Organizational Structure The Nigerian Communication Comm ission, which was inaugurated in July 1993,180 has its head office in Abuja, the nations capital. Th e organizational structure of the agency shows that the Board, which comprises the Chairm an, Executive Vice Chairman/CEO, and the commissioners, sits atop the hierarchy. Ironi cally, the Chairman, Alhaji Ahmed Joda, is a seasoned technocrat, who starte d his career as a journalist.181 The Executive Vice Chairman/CEO, Ernest Ndukwe, is an engineer and so also are four other commissioners. The two other commissioners are a distinguished bank er and a lawyer. The two statutory executive commissioners are both engineers; one of them is responsible fo r licensing and consumer affairs while the other is in charge of engineering and standards. The commission has five directorates, na mely: (a) Engineering responsible for frequency planning, allocation, and monitoring; (b) Technica l Research and Standards responsible for standards and codes, network planning, and enforcement; (c) Legal Affairs responsible for license documentation and regist ry, dispute resolution an d litigation, and laws and regulations; (d) Licensing Directorate responsible for licensing, zonal operations and tariffs and charges; and finally (e) Support Services Directorat e responsible for finance, administration, human resources, and information technology. The Commission has five zonal offices in E nugu (Southeast), Ibadan (Southwest), Kano (Northwest), Lagos (Southwest) and Port Harcourt (Southsouth). There are other special units under the Chief Executive's Office including consum er affairs, corporate planning and research, audit, and public affairs and media relati ons. By April 2000, the Commissions professional 180 FEDERAL REPUBLIC OF NIGERIA, NATIONAL TELECOMMUNICATIONS POLICY 13. 181 NIGERIAN COMMUNICATIONS COMMISSION, JOINING THE DIGITAL REVOLUTION: NIGERIAN TELECOM INDUSTRY REPORT, JANUARY 2000 TO SEPTEMBER 2003 4 (2003).
134 staffs were only about 39 including attorneys, engineers, accountants, technicians/technologists, and management other professions.182 The Commission added 23 new staff at the beginning of 2004.183 The Commission has also init iated and established the Digital Bridge Institute, which provides hands-on technical, engi neering, and policy education on telecommunications and IT and is aimed as serving as a focal point for human resource development and workforce capacity building, as well as, research drive on matters relating to telecommunications in Nigeria, and Africa in general.184 The DBI is based in Abuja, the nations capital. NBCs Organizational Structure The NBC or ganizational structure shows that the Board of Commi ssioners is atop the agencys hierarchy and, as statut orily required, the Commissions head office is located in Abuja, the Federal Capital. The pioneer Board, wh ich was inaugurated on October 6, 1992, had a seasoned journalist/editor, Mr. Peter Enahoro, as chairman.185 Dr. Tom Adaba, a broadcaster and ex-academic served as the first and longest se rving Director General/CEO of the Commission. Currently, the Commission has no Bo ard of Commissioners but Mr. Yomi Bolarinwa, who is an engineer, is the Acti ng Director General.186 Unlike the NCC, the NBC has no executive commissioners. The commission has six directorates, the heads of which together with the DG 182 Id ., at 7 (NCC, Benue Plaza, Abuja, 2003). 183 NIGERIAN COMMUNICATIONS COMMISSION, NCC NEWSLETTER 4 (March/April 2004) (bimonthly publication covering the activities and news within the Commission); available at http://www.ncc.gov.ng/newsletter.htm 184 Digital Bridge Institute, About Us: Mission Statement available online at: http://www.dbieducation.org/about.htm (last accessed February 02, 2008). 185 National Broadcasting Commission, About Us (n. d.) available at http://www.nbc.gov.ng/about.php (last accessed May 29, 2008). 186 Id
135 and the Secretary to the Commission compri se the Management. The Commission has, on average, a staff strength of about 350.187 The six directorates of the commission ar e: (a) Office of the Secretary to the Commission/Legal Department re sponsible for official records, Board meetings, and litigation involving the Commission; (b) Directorate of Monitoring & Op erations responsible for monitoring programming and ensuring compliance with the provisions of Nigeria Broadcasting Code such as the right-of-reply, etc; (c) Di rectorate of Human Re sources Management responsible for personnel matters and building/f acilities procurement and maintenance; (d) Directorate of Finance respons ible for managing the commission s finances including assets and liabilities; (e) Directorate of Research, Planning, Policy & Standards responsible for conducting research for the development of the industry, developing mass communication curricular and promoting authen ticated radio and television audience measurement. This directorate also sets the framework for broadc ast engineering policies and standards for all operators;188 and finally, (f) Directorate of Tec hnology and Information and Communications Technology responsible for managing the broa dcast spectrum, setting up standards for broadcast technology and IT applicab le to the broadcast industry. Two special units, the Internal Audit and Public Affairs, responsible for fina ncial control and image management respectively, are under the office of the Director General. Another major component of the NBC structure is the zonal and st ate offices. According to the commission, for effective monitoring and regulation of broadcasting, it has ten zonal 187 Id 188 National Broadcasting Commission, Management Structure, available at http://www.nbc.gov.ng/management.php (last accessed May 29, 2008).
136 offices.189 These zonal offices are located in Abuja, Benin, Enugu, Ibadan, Jos, Kaduna, Lagos, Maiduguri, Sokoto, and Uyo. In line with its policy of no stati on should be more than two hours drive from a zonal office, the commission has ten state offices in addition to the zonal office for effective monitoring and station audit.190 These state offices are in Bauchi, Calabar, Gombe, Ilorin, Jalingo, Kano, Kebbi, Po rt Harcourt, and Umuahia. Conclusion This chapter exam ined the legal instru ments establishing the two communication regulatory agencies in Nigeria. The chapter id entified the extent to which the National Mass Communication Policy and Nationa l Telecommunications Policy influenced the legislation on broadcasting and telecommunications respectiv ely. Further, the chapter discussed the organization structure of the tw o agencies identifying their or ganization hierarchy, the units within each agency, their staff strengths, as well as their national presence in terms of their zonal offices. Atop the hierarchy of each agency is a Board of Commissioners, mostly accomplished professionals and technocrats. Both agencies have directorates re sponsible for various aspects of their regulatory functions and un its that provide administrative a nd logistic support services to the commissions. The structure of the Commissions, especially th e establishment of a Board of Directors, is clearly an indication of th e continuing politics of patronage for there was no reason for a Board since the commissions are not a public corpor ations expected to pr ovide services and be managed like a company. Moreover, the number of the members of the board seems unwieldy having regards to the logistics and cost of convening meetings of such a large number of 189 National Broadcasting Commission, Brief: Management Structure available at : http://www.nbcnig.org/corporate.asp (last accessed September 11, 2004). 190 Id
137 members of the Board. Thus, the constitution of bo ards for the commissions, especially their unwarranted large sizes, vindicates the argument that part of the objective of the privatization program is to incorporate more members of the b ourgeoisies and even the petty bourgeoisies into the ruling class.191 Further, the lack of teleco mmunications policy before the passage of the NCC Decree underscores Hydens thesis regarding policy de ficit in many decisions by governments of African countries. The consequence of the policy defi cit in this regard is seen not only from the shortcomings of the NCC Decree but also from the Communications Act, which is an improved legislation that is based on the National Telecommunications Policy. Finally, this chapter culminated the disc ussion of the evolution of communication regulatory policy reform that was begun in the chap ter three. It is clear from the commencement of the reforms to date there had been at least four different administra tions in Nigeria none of which sort to reverse the reforms initiated by the preceding administration. This may be interpreted as evidence of the global trium phalism of capitalism theorized by Fukuyamas end of history thesis.192 The next chapter will present an overview of the current structure of the Nigerian broadcasting and telecommunications environment and discuss the findings of this study and, thus, answer the research que stion of the dissertation. 191 See generally AUTHORITARIANISM, DEMOCRACY, AND ADJUSTMENT: THE POLITICS OF ECONOMIC REFORM IN AFRICA (Peter Gibbon, Yusuf Bangura, & Arve Ofstad, eds., 1990). 192 See generally FRANCIS FUKUYAMA, THE END OF HISTORY AND THE LAST MAN (1992).
138 CHAPTER 5 A DECADE OF DUAL DEREGULATI ON AND THE CHANGE D STRUCTURE OF COMMUNICATION SECTOR: A DI SCUSSION AND ANALYSIS This chapter will provide an overall assessmen t of the current communications sector in Nigeria by presenting an overview of the post-deregulation changes in the structure of both the telecommunications and broadcasting sectors with a view to answer ing the research questions of the dissertation. In attempting to answer the re search questions, the chapter will apply the theoretical framework and rely on the literature re view and the discussions in chapters three and four. This chapter will end by describing the cha llenges that the NBC and NCC currently face in regulating Nigerian communications sector in order to achieve po lices aimed at making services more widely available to the citizenry. This chapter will be followed by the conclusion to the dissertation that will be suggesting polic y reforms for the NCC and NBC and the communications regulatory environment in genera l and by identifying areas for further inquiry. The Changed Structure of Communications Sector There is no doubt that since the com menc ement of regulatory reforms in 1992 many changes have marked the communications envi ronment in Nigeria ranging from increased number of telecommunication service providers to a vigorous private broa dcasting industry. To fully appreciate the changes it may be more co mprehensible if the two sectors are examined separately. First, we shall examine the changes in broadcasting landscape and then look at the environment of the telecommunications sector. It was shown in chapter three that by the ti me the military regime commenced regulatory reforms in 1992, the structure of broadcasting in Nigeria comprised federal government-owned radio and television stations th at were broadcasting on VHF and SW/FM respectively; radio and television stations owned by state governments that broa dcast on AM/FM/MW and UHF respectively; and the largely illegal DBS providers. At that time, the Nigerian Television
139 Authority and the Federal Radio Corporation of Nigeria respectiv ely had the only television and radio networks in the country. There was no regulatory agency other than the federal ministry of communications whose only responsibility was the assignment of frequencies to federal and states radio and television stat ions. Finally, and may be needless to say, there were no private broadcasters at the time. But since the 1992 promulgation of NBC D ecree No. 38, a lot has changed in the broadcasting landscape. On June 10, 1993, on th e recommendation of the NBC, the new regulatory agency, then military president, Ib rahim Babangida, signed and personally handed out licenses to the first set of broadcast entreprene urs in Nigeria.1 Twenty seven licenses were granted: 14 for broadcasting and 13 for cable/MMDS transmission.2 More stations were subsequently li censed by the NBC such that by December, 2003, in addition to the four national radio SW stations and about 20 FM owned by the federal government, the following had also been li censed: 66 NTA televisi on stations; 48 state government-owned television stations; 37 state government-owned radio stations; 60 private radio stations; 14 private tele vision stations; 12 DTH providers ; and 60 MMDS cable providers.3 Many more stations have been licensed since th en; but, some of these licenses have been canceled as the current numbers on the NBC website shows that operational at the moment are 100 radio stations, 147 television st ations, 35 cable providers, 4 DTH and 4 DBS stations on air.4 1 NATIONAL BROADCASTING COMMISSION, ANALYSIS OF REGULATIONS AND COMPETITION IN THE NIGERIAN BROADCASTING INDUSTRY (A COMMISSIONED STUDY BY QUESTECH MEDIA LTD) 4 (2004), available at http://www.nbc-nig.org/research1.asp (last accessed September 11, 2004). 2 Id 3 Id at 7. 4 National Broadcasting Commission, Frequently asked Questions (n. d.), available at http://www.nbc.gov.ng/faq.php (last accessed May 10, 2008 from).
140 In addition to licensing the various broadcast stations and cable prov iders, the NBC has, in consultation with stakeholders in the br oadcasting industry, en acted and published the National Broadcasting Code (hereafter the Code) first in 1993 then revised it in 1996 and 2002.5 The Code, according to NBC, was designed to ensure a free and responsible broadcasting service to Nigeria, and to stimulate the cont ribution expected of broadcasting in a truly democratic society.6 The Code outlined the social, cultural, economic, political, technological, and professional objectives of broadcasting in Nigeria.7 The Code provided detailed guidelines for licensing applications and procedures8 as well as procedures for lodging complaints and holding public hearings by the NBC.9 The Code also outlined the categories of licenses (comm unity, campus, DBS, and other broadcasting)10 and provided guidelines for various programming fr om childrens programs to political campaign coverage11 as well as the regulations on all kinds of advertising childrens, political, religious, and alcohol and tobacco advertising.12 Finally, the Code also made provision for a right of reply13 and prohibited the local terres trial stations from live re-broadcasting of news by foreign 5 See generally NATIONAL BROADCASTING COMMISSION, NATIONAL BROADCASTING CODE (2002). 6 Id S.1.4.0. 7 Id. S. 184.108.40.206.5.6 (these objectives are respectively: promoting gene rally accepted social values and norms; identifying and promoting Nigerias diverse cultures; build ing a self-reliant, strong, and egalitarian society with a great dynamic economy; creating political awareness and incu lcating the tolerance of divergent opinions in order to achieve a democratic society; promoting the study of science and technology; and th e recruitment and training of personnel and guaranteeing job security respectively). 8 Id. S. 2.0.0. 9 Id. S. 2.13.0 10 Id. S. 2.0.0. 11 Id. S. 5.4.0. 12 Id. S. 8.0.0. 13 Id. S. 3.4.4.
141 media.14 As it shall subsequently be discussed, the Commissions proced ure for granting of licenses and the attempt to enforce the last provision were to prove controversial. Thus, by 2004, the structure of broadcasting se ctor in Nigeria has changed from what it used to be in the early 1990s because the new st ructure comprises the Ministry of Information responsible for the implementation of the National Mass Communication Policy, supervising the regulatory agency, the NBC, and managing a nd operating the two federal government owned radio and television networks, the NTA and FRCN; the NBC responsible for regulating broadcasting and assisting the Ministry with formulating and implementing mass communication policies relating to broadcasting; the state radio and television stations; and the private radio, television, DTH, and DBS, and cable providers. These changes in the broadcasting sector similarly resulted in the telecommunications sector within the same period of regulatory re form. After its inaugurat ion in 1993, the Nigerian Communications Commission (NCC) embarked on licensing of private telecommunications service providers by ratifying the license that was awarded in principl e by the Ministry of Communications in 1992 to a company calle d EM-International Systems Nigeria Limited (EMIS) but it was in 1994 th at the company was assigned a frequency to operate a national Global System for Mobile Communications (GSM) network.15 Although by December 1996, i.e. about four years after the commencement of commercialization and privatization, no less than forty-five private telecommunica tions companies have been granted licenses to provide various services, many did not commence operations as indicated by the fact that the incumbent government monopoly, NITEL, remained the key, if not the only player and the congestion of 14 Id. S. 5.1.4. 15 ADEYINKA F. MODUPE, TECHNOLOGICAL RESPONSE TO TELECOMMUNICATIONS DEVELOPMENT: A STUDY OF FIRMS AND INSTITUTIONS IN NIGERIA 33 (2001).
142 lines continue to affect the qua lity of services evidenced by p oor call completion rates and high call drop rates.16 There was also continuing capacity underutilization because by December of 1996 only 396, 962 lines have been connected out of the 603, 452 installed capacity of NITEL and even in Lagos, the nations commercial capit al, only 119, 810 lines were connected out of the installed capacity of 137, 713; while in Abuja, the nations capital, only 12, 506 lines were connected out of 21, 000 installed capacity.17 It has been observed th at most of the licensed private companies were only into providing privat e network links through VSAT, especially to commercial and banking corporations.18 By the year 2000, the situation had slightly improved due to the commencement of operations by fixed cellular telephone companies such as Intercellular and Multi-Links.19 But by the situation was about to change that same year when the NCC commenced preparations for the auctioni ng of three GSM licenses that eventually took place in January 2001 in the nations capital, Abuja.20 It has been argued that telecommunications policymakers and regulators should note the Nigerian GSM auction because it is the first time in such aucti on that a variation of the so-cal led Anglo-Dutch format which combines elements of ascending and sealed bid formats had been used.21 Moreover, the auction was deemed a great success based on the reve nue of $285 million per li cense, which was not 16 AFEIKHENA JEROME, PUBLIC ENTERPRISE REFORM IN NIGERIA: EVIDENCE FROM THE TELECOMMUNICATIONS INDUSTRY 25 (2003). 17 MINISTRY OF COMMUNICATIONS, DIGEST OF STATISTICS, 5TH EDITION 23-24 (1997). 18 MODUPE, TECHNOLOGICAL RESPONSE TO TELECOMMUNICATIONS DEVELOPMENT, supra note 15, at 31-36. 19 Chris Doyle and Paul McShane, On the design and implementation of the GSM auction in Nigeria the world's first ascending clock spectrum auction 27 TELECOMMS. POLICY 383, 389 (2003). 20 Darin Lee, Lessons from the Nigerian GSM Auction, 27 TELECOMMS. POLICY 407, 409 (2003). 21 Id. at 407-8. Lee also observed that the Nigerian GSM auction was the firs t time in auctioning spectrum that used the clock auction format one in wh ich the price ticks up and bidders me rely choose to accept or reject the price of bidding has been used. Id. at 408).
143 only substantially more than the government and everyone had expected but is also perhaps the highest per capita revenue raised fr om spectrum auction until that time.22 Since the auctioning of GSM licenses, Ni gerias telecommunications sector has witnessed exponential growth b ecause within two years (i.e., the end of 2003) there were 853,000 main (wired fixed) lines; 3,149,000 million mobile lines; and the total telephone lines estimated to be 4,038,000.23 This growth continued as indicated by the end of 2004 when the main lines increased to 1,027,500 (0.81 per 100 inha bitants), and the number of mobile lines almost tripled to 9,147,200 (7.20 per 100 inhabitants) and thus bringing the total number of lines to 10, 147, 700, which translates into 8.0 per 100 inhabitants.24 There are, however, questions regarding how the number of mobile lines can be translated into the teledensity of a country since in the case of Nigeria many subscribers ha ve more than one line largely because of the poor interconnection between the service providers. Further, the lines purchased for short-term use by visitors are not accounted for in the calculation of the te ledensity. Finally, while the rural populace as part of the overall national population is included in the computation of teledensity, nothing in the provision of service by mobile phone service compan ies indicate they are actively providing these services to the rural areas.25 Not only has the number of lines grown rapidl y and with it the teledensity, but many new telecommunication service providers have now entered the market to provide complimentary and 22 Id. at 414. 23 INTERNATIONAL TELECOMMUNICATIONS UNION, WORLD TELECOMMUNICATIONS INDICATORS (BASIC INDICATORS) 1 (2004). 24 INTERNATIONAL TELECOMMUNICATIONS UNION, WORLD TELECOMMUNICATIONS INDICATORS (BASIC INDICATORS) 1 (2005). 25 Nigerian Communication Commission website, available at www.ncc.gov.ng (last accessed December 20, 2006).
144 supplementary services.26 In the most recently published statistics on suppliers of communication services, the number of national ca rriers increased from on e to two in 2002 with the licensing of Glo Mobile as the second na tional carrier thereby breaking the monopoly of NITEL. While the number of GSM providers remain s the initial four that were licensed in 2001 (largely of the exclusivity period), the number of fixed telephony provide rs has increased from nine in 1999 to 17 in 2002 and to 24 by 2004.27 The number of Internet service providers has doubled from eighteen in 1999 to 36 in 2004; moreover, there are now about 51 VSAT Network providers, which were virtually nonexistent before 2003.28 In conclusion, the current structure of Nigeri as telecommunications sector has four main components: the Ministry of Communications (formulating broad telecommunications policy and monitoring implementation and hosting th e National Frequency Management Council, NFMC), the NCC, the incumbent NITEL, and the private telecommunications service providers. In view of the foregoing discussions about the changes in broadcasting landscape and telecommunications environment and the changed structure of both sect ors in the wake of regulatory reforms, the dissertation will now a ttempt to answer the research questions. Answering the Research Questions After the discussion of the disse rtations theoretical fr amework in chapter one, the following research questions were identified as the ones this dissertation will attempt to answer: What specific communication regulatory reform s occurred during 1994-2004 in Nigeria? What were the outcomes of these reforms on Nigerias communications sector? 26 NIGERIAN COMMUNICATIONS COMMISSION, TRENDS IN TELECOMMUNICATIONS MARKETS IN NIGERIA, 2003-2004 43 (2005), available at www.ncc.gov.ng (last accessed May 18, 2008). 27 Id 28 Id
145 How may the Nigerian communi cations regulatory reform be explained by Horwitzs theories of communication regulation? How do these theories of regulation shed light on the policy process involved in deregulating the Nigerian communications sector? Because policy making in developing countries like Nigeria is influenced by international actors but nation states remain the engine room for communication policies, which international factors influenced Nigeria s communication deregulation and how did Nigerias national interests moderate those international influences? What is the nature of the regulatory agencies created in the pr ocess of deregulating Nigerias communications sector? Specificall y, to what extent are the NCC and NBC independent regulatory agencies based on the ITUs best practices guidelines? First Research Question In answering the first research question, it should first be no ted that the regulatory refor ms that occurred between 1994-2004 were the outcome of the legislation th at was enacted in 1992, that is the Decrees that established the Na tional Broadcasting Commission and the Nigerian Communications Commission, which were empowered to initiate and manage the entrance of private broadcasters and teleco mmunications service providers in to the communications sectors that were hitherto government monopolies. It was found that the co mmunications regulatory reforms that occurred in the period examin ed began with the commercialization or corporatization of Nigerias te lecommunications services provider, NITEL, and the introduction of limited commercialization of NTA and FRCN, the federal gove rnments owned television and radio networks respectively. In the policy arena, the government adopted a new National Telecommunications Policy on the basis of whic h the legislature passe d a new Communications Act which repealed the existent (19 92) decree that established the NCC. The cumulative effects of these regulatory reforms to the communications sector is the transformation of the sector into a more divers e and vigorous segment of the Nigerian polity and economy with the multitudes of broadcasters and competitive telecommunications service
146 providers. Politically, the public sphere has been expanded with the entrance of new, private broadcasters, thereby furthering the enthronement of democratic values of freedom of expression and freedom of the press. Economically, the new trends in telecommunica tions helped to bring foreign direct investments and generate revenue for the governme nt while both broadcasting and telecommunications have created thousands of j obs. Socially, more broadcasters now provide entertainment while the telecommunication serv ice providers give more people means of reaching out to loved ones and friends and colleagues. Finally, the regulatory reforms introduced a new apparatus in Nigerias bur eaucratic structure in the form of independent regulatory agencies while the subsequent adoption of the National Telecommunications Policy coupled with the 2003 enactment of the Communications Act strengthened the independence of one the agencies, the NCC. Second Research Question The second question this dissertation sought to answer is how m ay the theories of communications regulation outlined by Horwitz explain Nigerias communications regulatory reform and or how do these theories of regulat ion shed light on the policy process involved in deregulating the Nigerian communications sector? Answering this question requires the understanding that telecommunicat ions and broadcasting in the United States (Horwitzs constituency) and Nigeria emerged through diametrical ly different paths: pr ivate entrepreneurs in the former and (colonial) government in the latter. However, a major similarity is that in both cases the initial te lephone service provider was a monopoly, i.e. AT&T in PT&T in the United State and Nigeria respectively. Als o, in answering this question, it s hould be recalled that the five theories Robert Horwitz outlined include public in terest, regulatory failure, conspiracy-capture,
147 organizational behavior, a nd capitalist state theory.29 First, an analysis of how the public interest theory may explain Nigerias communication regulatory policy reform. Public interest theory is gene rally derived from legislative in tent of regulations that are enacted in response to the failure of the free mark et to protect the intere st of the general public, especially where the market is dominated by a monopoly.30 In such a situation, state intervention to correct the workings of the ma rket, such as the creation of regulatory agency, which is viewed as the concrete expression of th e spirit of democratic reform [and] as the victorious result of the peoples struggle with corporate interest,31 and deregulation is viewed as the dismantling of cartels and monopolies or oligopolies in order to pave the way for competition in the interest of consumers.32 There is no doubt that at the beginning of Nigerias regulatory reforms the telecommunications sector was monopolized by NI TEL while the broadcasting sector was at best a duopoly characterized by the stat e and federal broadcasting stat ions. It has been discussed earlier that Nigerians were dissatisfied with th e inefficiencies of tel ecommunication services and had also been complaining about the government monopoly of broadcasting in some cases they resorted to illegal reception of foreign broadcast via satellite. In both cases, Nigerians have expressed their desires to have more providers, a desire that was articulated by the intelligentsia and entrepreneurs at separate conferences on mass communications and telecommunications policy. Thus, it may be concluded that public interest was the genesis of the creation of the 29 ROBERT B. HORWITZ, THE IRONY OF REGULATORY REFORM: THE DEREGULATION OF AMERICAN TELECOMMUNICATIONS 23 (1989). 30 Id 31 Id at 24. 32 Id at 17.
148 regulatory agencies charged with ushering in private broadcaste rs and telecomm unication service providers into the Nigerian communications environm ent. Further, to a large extent, the resultant increase in the number of broadcasters and te lecommunication service providers, which offers the general public multiple forums for publ ic expression and competitive options for telecommunications services, may viewed as serving the interest of the consumers. The second theory Horwitz identified in explaining communica tions regulation is regulatory failure theory. Unlike the public interest theory that emphasizes the circumstances of the emergence of regulatory agencies, the regulato ry failure theory focuses on the operations of regulatory agencies. It concludes that the attempt to regulate businesses is a failure largely because the regulators may lack the willingness or the capacity to enforce regulations in the interest of the public partly because of the in fluence of the industry on the agency and the reliance on the industry for information by regulators.33 First of all, without even examining the operations of agencies to ascertain the influence of the regulatees, an examination of the statutes that established the agencies indicates that the appointme nt of representatives of the regulatees is required in the composition of both the broa dcast and telecommunications regulator. For example, the NBC Decree require s that the members of the Commission be appointed to represent the following inte restslaw, businessmedia, among other interests.34 Similarly, the NCC Decree requires that the commissioners to be appointed should have requisite experience in any one or more of the following fields co mmerce, consumer affairs, financial matters, industry, law, management, public administ ration, technology, and telecommunications 33 Id at 27 (further pointing out that the influence is either because the regulators appo intment was influenced by the industry, they were drawn from the industry, are looki ng forward to a career in the industry, or because the agencies lack resources for gathering the information necessary for policymaking, they rely too much on the industries for such vital information and end up not only getting too close to the industry that they regulate but seeing things from the perspective of the industry). 34 NATIONAL BROADCASTING COMMISSION DECREE S.3(1)(b).
149 engineering.35 Although the NCC Decrees wording is not as explicit as that of NBC, those to be appointed with requisite experience in i ndustry are mostly going to come from the telecommunications industry. While one or tw o members of a 9-member commission may not have the final say on a commissi ons decision, suffice it to point out that the regulatees exercise at least some influence on the agencies deci sions resulting from the presence of their representatives. In their first decade of operations, Nige rias communications regulators have not exhibited the influence of the regul atees in terms of relying on th e regulatees for assistance with information needed for the purposes of rulemaki ng in part because the laws made it mandatory for the industry to provide any information request ed by the agencies and, in the case of NCC, non-compliance and providing an incomplete or false information is a punishable offense.36 However, there is slight indica tion that regulators may be inte rested in going to work for the industry they are regulating, which according to regulatory failure theor y, could influence the regulators. The lead evidence here is the pioneer Director General of the NBC, Dr. Tom Adaba, who now serves on the Board of DAAR Commu nications, the company which owns African Independent Television and RayP ower FM, both being among th e most popular television and radio stations in the country.37 Further, NCCs current Vice Chai rman and CEO, Ernest Ndukwe, came to the job after holding several senior management positions in leading telecommunications companies.38 Therefore, we may be w itnessing the revolving-door 35 NIGERIAN COMMUNICATIONS COMMISSION DECREE S. 3(1a-c). 36 NIGERIAN COMMUNICATIONS ACT S.65(1-2). 37 Daarnews.com, DAAR Communicati ons Plc Directors Profile, available at http://www.daarnews.com/profiles.html (last accessed May 12, 2008). 38 Nigerian Communications Commission, Ex ecutive Vice Chairman/C hief Executive, available at http://www.ncc.gov.ng/boardevc.htm (last accessed May 11, 2008).
150 phenomenon in both broadcasting and telecommunications industry/agency staff movement, which influences regulators not to act in ways that will be harmful to the regulated industrys interests.39 In other words, the findings of this disse rtation may not provide strong evidence to support regulatory failure theory in the case of Nigerias communications regulatory reforms. However, the findings about the agencies statutes requirement of appointment of representatives of the media and telecommunications industry into the commissions and the entrance and exit of the chief executives of the agencies to and from the sectors they regulate, provide some evidence pointing in the direction of po ssible regulatory failure marked by increasing influence of the regulatees. The third theory, conspiracy-cap ture theory, similar to the regulatory failure theory, is concerned with industrys influence on the regula tory process. But conspiracy-capture theory goes further than regulatory failure theorys asse rtion about industrys infl uence to postulate that even the enactment of regulation is the result of the request by th e industry that s eeks to prevent competition through price and entry restriction; and, where the industry did not initiate regulation, subsequent actions of the regulatory agency are at the behest of the regulated businesses. In short, the concerned industries ei ther conspire to init iate regulation or the establishment of a regulatory agency and wher e the agency was established by popular demand, the industry then schemes to capture the regulatory agency.40 In examining the genesis of Nigerias co mmunications regulatory reforms in chapter three, it was shown that entrepreneurs in terested in investing in the media and 39 CHRISTOPHER H. STERLING, PHYLLIS W. BERNT, AND MARTIN B. H. WEISS. SHAPING AMERICAN TELECOMMUNICATIONS: A HISTORY OF TECHNOLOGY, POLICY, AND ECONOMICS 28-29 (2006). 40 HORWITZ, THE IRONY OF REGULATORY REFORM, supra note 27, at 23.
151 telecommunications market joined the agitation for regulatory reforms but there is no evidence that their agitation, by itself, was decisive in the governments po licy outcome. Secondly, because Nigerias regulatory reforms ended the monopolization in the broadcasting and telecommunications sector, it is in conceivable that the incumbents influenced the legislation that opened up, rather than restricted, competition. On the other hand, in their regulatory opera tions, the NCC and NBC have acted in ways that, prima facie privileged an incumbent or a market l eader. For example, private broadcasters have complained about the lack of level-playi ng field in the broadcasting sector because while the NBC charges government stations about ha lf a million naira (approximately $4600) for a license they (private broadcasters) are ch arged about 20 million naira (approximately $184,600).41 This disparity was described as s hocking by no less a pe rson than Atiku Abubakar, then the Vice President of Nigeria, who also observed that such a situation will not encourage the growth of private broadcast st ationswithout a level-pl aying field, privatelyowned broadcast stations may not be able to survive.42 In this context, it ma y be insinuated that the high license price is used as entry barrier against private broad casters to the advantage of the incumbent government broadcasters thus confirming conspiracy-capture theorists earlier postulation. 41 THISDAY, Atiku Wants Level Playing Field in Broadcasting March 12, 2004, available at LexisNexis.com (last accessed March 30, 2004). 42 Id
152 In response to the charges of disparity in license fee, the NBC has responded by saying the allegation that it charges discriminatory f ees against private broadcasters is erroneous.43 The Commissions Director General, Dr. Silas Baba jiya Yisa, at a press conference stated that: In comparative terms, a public station covers a state and is required to pay N2.5million for a five year period. A private station that c overs a minimum of four states pay[s] a commercial license fee of N15 million for television and N20million for radio at the maximum. The lower rung for this category is N7.5million for television and N10million for radio also for five years.44 Plausible as this NBC explanation may s ound, the question remains why must private broadcasters license cover more than one state? In telecommunications regulati on, it may be argued that a hi gh price was used as entry barrier by the NCC to advantage the incumbent NITEL when it was decided that one of the four GSM licenses to be issued will be reserved for NITEL while the remaining three will be auctioned.45 However, NITEL, as well as the winners of the three auctione d licenses, will be required to pay the final fee that the auction determined for a license.46 Further, it is doubtful if NITEL was required to pay the upfront deposit of $20 million required of all bidders. Finally, it is also doubtful that NITEL was required to pay the license fee within 15 business days or lose the license, forfeit the deposit, as well as be prohibited from any telecommunications licence process in Nigeria for 5 years, all penalties that could have applied to other applicants for the auctioned GSM license.47 43 Okoh Aihe, HI-TECH:NBCs reforms attract sharp reactions from industry operators VANGUARD, (April 4, 2004), available at http://www.vanguardngr.com/article s/2002/features/fe107042004.html (last accessed April 5, 2004). 44 Id 45 Doyle and Paul McShane, On the design and implementation of the GSM auction in Nigeria the world's first ascending clock spectrum auction supra note 19, at 390. 46 Id 47 Id at 392.
153 In concluding the discussion on conspiracy-cap ture theory, it may be argued that there is no evidence indicating that a cons piracy by communications industrie s resulted in the Nigerian communications regulatory reform, especially the establishment of the regulatory agencies. However, the broadcast license fees, and the pr ocess of GSM license auction, seemed to lend credence to the conspiracy-capture theorists th esis that agencies price and entry regulations privilege the incumbents, though in this case it is not necessarily resulting from the capture of the agencies by the incumbents. The fourth theory Horwitz identified in explaining communica tions regulation is organizational behavior theory wh ich posits that regulatory agencies such as other organizations, are concerned or preoccupied with their integrity and survival mo re than the interest of the public. 48 Therefore, their actions, rath er than serving publics intere st, are aimed at appeasing the most powerful contending party or reaching a compromise between the contending parties, whichever of the two will serve the agencys well-being.49 In their first decade of operations, which is the focus of this study, the NBC a nd NCC have perhaps not fully matured as mainstream bureaucracies to exhibit the organizat ional behavior characterized by obsession with self-preservation. The remotest in dication of concern with organiza tional self-interest rather than publics interest would have been the high cost of GSM license and broadcast license if such monies were to accrue to the agencies. Howeve r, the NCC is required to deposit monies from spectrum sale into the consolid ated revenue fund of the nation50 while the NBC is only entitled 48 HORWITZ, THE IRONY OF REGULATORY REFORM, supra note 27, at 38. 49 Id. 50 NIGERIAN COMMUNICATIONS ACT, S.17(3) (2003).
154 to a percentage of fees and levy to be char ged by the commission on the annual income of licensed broadcasting stations.51 Moreover, there is no eviden ce to support even the princ ipal-agent perspective, a variant of organizational behavior theory, which argues that elected officials (principals) seeking to maximize electoral votes, regularly control the actions of regulators (age nts) in order to alter policies that will maximize their votes.52 According to this perspective, the agents accede and, in return, the legislators maximize th e regulators budgetary allocation.53 From the findings of this dissertation, there is no support for the organization behavior theory of communications regulation within the context of Nigerias commun ication regulatory refo rms. The relevance of revenue generation could be stretche d to argue that the exorbitant li cense fees were an attempt to demonstrate the agencies self-relevance and prov e the worth of their budgetary expenditures. Finally, the fifth theory identified by Horwitz in explaining communi cation regulation is the capitalist state theory. The theory argues that regulatory agencies operate as part of the structures of the capitalist system whose overall aim and objective is to protect private property and the system of capitalism. The agencies therefore regulate with the sole aim of ensuring the survival and continuity of the capitalist system regardless of whose individual interest may be hindered.54 Within the period under stu dy, two cases indicate that the NCC may intervene not necessarily for the interest of the citizens but to save the system from itself. The first case concerns the tariffs for calls that Nigerians complained about because it was exorbitant and some 51 NATIONAL BROADCASTING COMMISSION DECREE, S.14(2)(a). 52 MARC ALLEN EISNER, JEFF WORSHAM, EVAN J. RINGQUIST, CONTEMPORARY REGULATORY POLICY 27 (Second edition, 2006). 53 Id 54 Id
155 characterized it as exploitative to charge subscribers fifty naira (about $0.36) per minute for service that is generally poor quality. The two companies that do minated the GSM market at that time, MTN and VMobile, dismissed pressure to introduce per second billing (PSB), saying it was not immediately feasible.55 Meanwhile NCC stood by, doing nothing, continuing to proclaim that competition will solve the problem. This exploitation went on for two years until a Nigerian company, GloMobile, entered the ma rket in August 2003 and commenced operations with per-second billing from the start.56 The other providers, who for two years claimed the unfeasibility of per-second b illing, commenced the same within four months.57 Why did NCC buy into the argument of the two dominant providers that per-second billing was impossible and allowed subscribers to be exploited for two years? Perhaps because there was no threat to the system otherwise cont rast this case with the second case which is about the interconnection rates. It may be recalled that in the literature review, network externalities were identified as the benefits of the network effects to a subscr iber that is dependent on who else subscribes to the same network.58 In other words, the larger the network, the greater the benefits to subscribers. Therefor e, network externalities are adva nced as regulatory justification for requiring equal and non discriminatory interconnection by all service providers.59 Consequently, the Nigerian Co mmunications Act, and the li censing agreement signed by the 55 NIGERIAN COMMUNICATIONS COMMISSION, TRENDS IN TELECOMMUNICATIONS MARKETS IN NIGERIA, 2003-2004, supra note 26, at 14. 56 Id 57 Id at p. 15. 58 John Kay and John Vickers, Regulatory Reform: An Appraisal in DEREGULATION OR RE-REGULATION? REGULATORY REFORM IN EUROPE AND THE UNITED STATES 226 (Giandomenico Majone, ed., 1990). 59 See e.g., 47 U.S.C. 251 which provides, inter alia, that a telecommunications carrier has the duty (1) to interconnect directly or indirectly with the facilities a nd equipment of other telecommunications carriers; and (2) not to install network features, functions, or capabilities th at do not comply with the guidelines and standards established pursuant to section 255 or 256 of this title.
156 GSM providers, requires them to interconnect wi th other providers under such terms that are non-discriminatory, neutral, and wh ich provide equality of access.60 Further, the NCC is empowered not only to make guidelines for such interconnection but to al so intervene and make binding rulings at the instance of either or both parties61 or, if the Commission considers it in the public interest for it to so intervene at its own instance and without an y invitation from either or both parties to the agreement.62 Since the rolling out of serv ices by the GSM providers there had been what NCC itself admitted to be pro tracted interconnectivity disagreement among the providers. But it took a year befo re the NCC intervened to direct NITEL to interconnect its mobile network with those of other operators.63 Even then, not much changed as poor quality of service and very high rates remained while repeat ed calls by the federal authorities on the GSM companies to have efficient and effec tive interconnectivity were not heeded.64 Finally, the situation seemed unbearable to the subscribers, s o, as Ebenezer Obadare, a scholar of Nigerian civil society stated: On 19 September 2003, mobile phone subscriber s in Nigeria took the unprecedented step of switching off their handsets en masse. The su bscribers took this symbolic step in protest against perceived exploitation by the exis ting mobile phone companies. Among other things, they were angered by allegedly exor bitant tariffs, poor reception, and arbitrary reduction of credits. the boycott ought to be appraised, first, in the context of existing mistrust between citizens and tr ansnational big business in Nigeria; and second, against the 60 For the licensing agreement conditions, see Digital Mobile Licence [DML2G] Granted by Nigerian Communications Commission Under Section 12 of Act No. 75 of 1992; and Section 6 of Wireless Telegraphy Act of 1990, at 36 (n. d.) available at http://www.ncc.gov.ng/digital_mobile/dml_licence.pdf (last accessed May 17, 2008); for the Communications Act provisions, see S.96-97 (2003). 61 NIGERIAN COMMUNICATIONS ACT, S.97(2) 62 Id S.97(2c). 63 NIGERIAN COMMUNICATIONS COMMISSION, JOINING THE DIGITAL REVOLUTION: NIGERIAN TELECOM INDUSTRY REPORT, JANUARY 2000 TO SEPTEMBER 2003 23 (2003). 64 Ebenezer Obadare, Playing Politics with the Mobile Phone in Nigeria: Civil Society, Big Business and the State 33 REV. OF AFRICAN POL. ECONOMY 93, 108.
157 background of difficult state-soci ety intercourse which has mo stly been characterised by the latter's suspicion of the state's conni vance with the corporate establishment.65 It was the consumers revolt, with its potential for larger nega tive ramifications on the industry, that alerted the NCC about the possible self-destructive tendency of the unregulated so-called market competition and thus it e xpedited action to reign in the providers on interconnection rates by considering a June 2003 report on the co st of interconnection and issuing a ruling.66 In its December 2003 ruling, the NCC fixed connection rate s that saw an average of 45% reduction in the cost of interconnection effective March 2004.67 Unhappy with the ruli ng, the two leading GSM providers, MTN and V-Mobile we nt sued the Commission and lost.68 In conclusion, while there is no evidence re garding broadcast regul ation that shows the NBC acting in the interest of the capitalist syst em, in the telecommunica tions sector, which is riddled with the mantra of free market competition, the NCC interventions are mostly a last resort aimed at saving the capitalist system from its vagaries rather than to serve the public interest. Third Research Question The third research question asks how comm unication policy m aking in Nigeria, as in other developing countries, was influenced by inte rnational actors and, in view of the findings that nation states remain the engine room for communication policies, how did Nigerias national interests moderate those international in fluences? As discussed in chapter three, the communications regulatory policy reform was par tly undertaken as part of the overall national 65 Id at 93. 66 NIGERIAN COMMUNICATIONS COMMISSION, JOINING THE DIGITAL REVOLUTION: NIGERIAN TELECOM INDUSTRY REPORT, supra note 61 at 23. 67 NIGERIAN COMMUNICATIONS COMMISSION, TRENDS IN TELECOMMUNICATIONS MARKETS IN NIGERIA, 2003-2004, supra note 26, at 38-39. 68 Id at 39.
158 economic restructuring under the auspices of the IMF/World Bank induced Structural Adjustment Program (SAP). As stated in the sa me chapter three, in the case of Nigeria, a 1990 World Bank decision to suspend a $225 million teleco mmunications loan was said to be critical to the commencement of major reforms and the deregulation of the tele communications sector because the Bank cited the need to strengthen the countrys policy framework, commercialize NITEL, and ensuring improved access to services as part of the reasons for its action.69 While agreeing with these international bodies to comm ence regulatory policy reforms in the form of privatization and commercializati on, Nigeria sought to protect cer tain national interests both in the reform instruments and practice. For example, there is hardly any talk of privatizing the NTA and FRCN, the nations only radio and television networks, notw ithstanding their efficiencies. And, as discussed earlier, when th e GSM licenses were to be auc tioned, one license was reserved for NITEL, the incumbent government-owned national carrier, thereby ensuri ng that even if all the other three licenses were won by foreign companies, at least one license is to be held by the nations telecommunications company. Further, as discussed in chapter four, NCCs realization of lack of adequate qualified manpower has le d it to set up a worldclass telecommunications training center called the Digital Bridge Institute, which not only builds indigenous human capital but also saves the nation hard-earned foreign currency that would otherwise have been in sending people for training overseas. In terms of using the legal and policy instru ments to protect Nigeri as national interest, the NBC Decree, far more than the NCC Decree and Nigerian Communicat ions Act, does that because it requires that applicants for broadcas t license must be corporations whose whose 69 CHUCKA ONWUMECHILI, REFORM, ORGANIZATIONAL PLAYERS, AND TECHNOLOGICAL DEVELOPMENTS IN AFRICAN TELECOMMUNICATIONS: AN UPDATE 137 (2003).
159 majority shares are owned by citizens of Nigeria.70 The NBC Decree also requires all broadcasters to carry a large local content in th eir programming; specifica lly, radio and television must carry not less than 60% local content while cable and satellite broadcasters must carry not more than 80% foreign content.71 In concluding the answering of the fourth research question, suffice it to say that while Nigeria acceded to the global bodies pressure in terms of general restructuring of the economy by instituting the Structural Adjustment Program (SAP), the country moderated some of the programs by infusing its national interests in the communications regulatory policy reform. The country did so both in practice and by using th e regulatory policy instru ments especially in broadcasting, and, to some exte nt, even in telecommunications. Fourth Research Question The final research question asks what is the natu re of the regulatory agencies created in the process of deregulating Nigeri as communications sect or and, specifically, to what extent are the NCC and NBC independent regulatory agen cies based on the ITUs best practices guidelines? Based on their estab lishing instrument, i.e. the NBC and NCC Decrees, the agencies were setup separate entities from their mother ministries and each was granted a mandate that was hitherto partly the functi on of the agencys supervising ministry. By providing in their decrees that they are establishe d as corporate bodies that can sue and be sued, the agencies have been granted some fundamental autonomy from their mother ministries. Therefore, to a very large extent, it may be said that the ag encies are independent regulatory bureaucratic entities. However, to understand the extent to which they can be regarded as independent 70 NATIONAL BROADCASTING COMMISSION DECREE S.9(1a). 71 Id Third Schedule, S. 12(5b).
160 communication regulatory agencies, we shall be employing the ITU guideline discussed in chapter as analytical framework. In the detailed discussion of the ITU gui delines presented in chapter two, it was concluded that the major indicators of a regulatory agencys indepe ndence are the security of the leaderships tenure, financial independence, and fair, transparent and accountable decision making procedures. For the purposes of this analysis, the NBC Decree and Nigerian Communications Act, as the extant laws of agencies shall be us ed. First, an analysis of the recommendations of the ITU guideline that th ere should be a guarant eed secured tenure for members of the regulatory body; this is usuall y indicated by the manner they are appointed and removed. Perhaps, NCC has attained that re quirement following the passage of the 2003 Communications Act unlike in th e 1992 NCC and NBC decrees wher e the president is vested with the power to appoint and remove commissioners on his/her conviction alone, under the 2003 Communications Act appointment of commissioners is subject to the confirmation of the Senate and removal of a commissioner can only be done for reasons clearly provided in the Act and such a commissioner shall first be given the ri ght to fair hearing. More over, the term of the commissioners under the Act is 5 years unlik e the four-year term under the Decree. The implication of this is that the Commissioners ha ve no incentive to act at the pleasure of the president due to the desire for re-appointment since their tenu re would outlive the presidents four-year term therefore they are more likely to act independent of the president. One aspect of the ITU guideline not reflected by the Act in th is regard is the appointment of Commissioners in staggered te rm. Staggered terms ensure orga nizational learning and furthers the independence of the agency because hard ly would all the commissioners have been appointed by the same president. The current situation where all Commissi oners are appointed at
161 the same term for same 5-year tenure (barring retirements, death, removal), does not augur well for extending experiences of the old(er) member s to the new(er) ones thereby ensuring some continuity and dynamism respectively. The second major recommendation of ITU guidelines for independent regulatory agencies is independent funding. While both the NBC Decree and th e Communications Act made provisions for establishment of an inde pendent fund for the NBC and NCC respectively. But the NBC fund, into which the only money deposit ed is a percentage of fees and levy to be charged by the commission on the annual income of licensed broadcasting stations in addition to grants, 72 differs from the NCC fund, which has in addition to the same budgetary grants fees charged by the Commission under this Act or its subsidiary le gislation or under any licence issued pursuant to this Act except money from spectrum sale which is to be deposited into the consolidated revenue fund of the nation.73 Finally, while the NBC D ecree requires the NBC to submit to the Minister of Information audite d reports of its account s and report about its activities, the Communications Act provides that the NCC sha ll submit annual report of its activities and audite d account to the National Asse mbly, though through the president.74 Finally, the ITU guidelines noted that an indication of an independent regulatory agency is that the agency has a fair, transparent and accountable decision making procedures. The Communications Act requires the NCC to at all times carry out its functions and duties and exercise its powers in a transparent manner,75 including its formulation of licensing 72 NATIONAL BROADCASTING COMMISSION, S.14(2)(a). 73 NIGERIAN COMMUNICATIONS ACT, S.17(3) (2003). 74 Id S.21(1) (2003). 75 Id. S.4(2) (2003).
162 procedures and issuance of communications licenses.76 The NCC is also required to hold inquiries before making regulations and to take in to consideration the findi ngs of the inquiry in making the regulation.77 Unfortunately, no such provisions exist in the NBC Decree and therefore most of its decisions are hardly tran sparent. Although it is im possible to question the transparency of NBC with regards to the gran ting of broadcast license s since unlike the NCC, which has the power to grant telecommunicati ons licenses, NBC only recommends license applications to the president, through the minister, for his approval and grant of licenses.78 In conclusion, using the ITU guidelines as crit eria, the evidence from the existent statutes strongly indication while the inde pendence of the NCC has been greatly enhanced by the passage of the 2003 Communications Act, the NBC can hard ly be described as an independent agency based on the 1992 decree that established it, whic h made it virtually completely subservient to the supervising minister and the president. Current Regulatory Challenges for the Agencies Since their establishment over a decade ago, th e two communications regulatory agencies have come a long way and the impact of their activ ities is felt by virtually every Nigerian. There are however challenges confronting both the NBC and the NCC foremost among which is how to ensure that broadcasting and telecommunications ar e not only accessible to the urban elites as is currently the case. Secondly, while the NBC needs its own version of new stat ute in the spirit of the Communications Act that may enhance its in dependence also, the NCC needs to more highly trained professional staff to enable it cope with the ever-changing telecommunications technology. 76 Id. S.33(3) (2003). 77 Id. S.71 (2003). 78 NATIONAL BROADCASTING COMMISSION DECREE, S.2(1c).
163 CHAPTER 6 SUMMARY, CONCLUSIONS, POLICY RE COMMENDATIONS, AND SUGGESTIONS FOR F URTHER STUDIES Summary and Conclusions This dissertation exam ined the communications regulatory policy refo rms that took place in Nigeria between 1994 and 2004. It analyzed the regulatory policy changes in the light of five communications regulation theories iden tified by Robert Horwitz in his book, The Irony of Regulatory Reform Also examined in the dissertation is the international infl uence on Nigerias regulatory reform and how Ni geria modified the communica tions regulatory reforms to incorporate its national interests. The dissertation concluded by examining the extent to which the two communication regulatory ag encies of Nigeria, the NBC and NCC, may be regarded as independent agencies based on the guidelines for creating independent regulatory agencies created by the International Telecommunications Union. It was found that the Nigeri an communications environmen t have changed significantly during the period under study. The decade witnessed not only the enactments that established the Nigerian Communications Commission and Nati onal Broadcasting Commission as regulatory agencies responsible for midwif ing the entrance into the communications sector of private broadcasters and telecommunicati ons service providers respectivel y but also the commencement of operations by the two agencies. The licensi ng and commencement of operations by many private broadcasters and teleco mmunications service providers not only altered the structure of broadcasting and telecommunications sectors, but provided multiple sources of news and information to the citizenry as well as numerous means of communicating. The study found that there is some evidence though in some cases very weak in Nigerias communications regulatory policy reform to support each of the five theories identified by Robert Horwitz. In the case of public interest theory, it was found that the in terest of the
164 public was the genesis of the crea tion of the regulatory agencies (NBC and NCC) that ushered in private broadcasters and telecommunication servi ce providers into the Nigerian communications environment. On regulatory failure theory, the findi ngs of this dissertation did not provide strong evidence to support regulatory failure theory; but the agencies statutes requirement of appointment of representatives of the medi a and telecommunications industry into the commissions and the entrance and exit of the chie f executives of the agencies to and from the sectors they regulate provide some evidence pointing in the direction of possible regulatory failure marked by increasing influence of the regulatees. There is no evidence from the findings of the dissertation to support the conspiracy -capture theory because there was no obvious conspiracy by communications industries that led to the establishment of the regulatory agencies. The only seeming evidence in this rega rd is the alleged discriminatory broadcast license fees and the process of GSM license auction, which indicate that agencies price and entry regulations gave undue advantage to the incumben ts. The fourth theory, organizational behavior theory, which posits that regulator y agencies are more concerned w ith their integrity and survival than the interest of the public was found not be quite applicable to the Nigerian scenario; even its variant, the principal-agent pers pective, which argues that elected officials (principals) seeking to maximize electoral votes, regularly control the actions of regulators (age nts) in order to alter policies that will maximize their votes, was not supported by the findings of the dissertation. Finally, there is no evidence rega rding broadcast regula tion that shows the NBC had acted in the interest of the capitalist system. But in the tel ecommunications sector, with its touted primacy of free market competition, the NCC interventions are mostly a last resort aimed at saving the capitalist system from its vagaries rath er than to serve the public interest.
165 Consequently, no single theory can adequate ly explain the first decade of Nigerias regulatory policy reforms. Therefore, in general, the findings tend to agree with the conclusions of Horowitz that each of the th eories of regulation onl y emphasizes certain aspect of regulation the origins, structures, processes or the operations of the agencies and therefore each theory has something to offer to the understanding of regulation; while each theory also has its shortcomings.737 Consequently, it is often problematic to speak of a single exclusive regulatory theory.738 Perhaps, in view of the inadequacy of the ex istent theories to expl ain Nigerias regulatory policy reforms, there is the need to consider employing another theoretical framework. One of the fundamental differences between the United St ates, the context of Horwitzs theorizing, and the Nigerian case is whereas in the United Stat es it is a case of market failure (private entrepreneurs pursuing thei r self-interest that did not serve th e public interest), in Nigeria it was the case of a government parastatal or public corp oration that failed to serve the public interest. Thus, the theoretical implication here is there is the need to theorize about the case of government failure in relation to communications regulation in developing countries, such as Nigeria, whose governments were the provide rs of broadcasting a nd telecommunications services. While there has been th eorizing about government failure relating to certain sectors of the economy such as social servi ces, not much has been done in te rms of the application of the theory as analytical framework for examining the communications sector. This study also found that although Nigeria cav ed in to the pressures of IMF/World Bank to commercialize and privatize corp orations and or services as part of the structural adjustment 737 ROBERT B. HORWITZ, THE IRONY OF REGULATORY REFORM: THE DEREGULATION OF AMERICAN TELECOMMUNICATIONS 43 (1989). 738 Id at 46.
166 program, the country ensured that national intere sts are preserved by refusing to sell the nations only television and radio networks, reserving on e of the four lucrative GSM licenses for the nations incumbent telecommunications service pr ovider, requiring that Ni gerian citizens have majority shares in corporation seeking broadcast licenses and re quiring broadcasters to provide high amount of local conten t in their programming. The final finding in the dissertation is that the National Telecommunications Policy combined with the new Communications Act whic h was passed in 2003 have created a better regulatory environment in telecommunications sector by enhancing th e independence of the NCC than the regulatory environment in broadc asting where the NBCs independence is still overshadowed by the overarching ro le of the Minister of Information and the President in its licensing and other operational matters. Policy Recommendations The need for reforming the NBC laws cannot be overemphasized having regards to the imperative of agency independence in ensuring tran sparent regulatory activities. But first there is the need to review the current National Mass Communication Policy which was adopted nearly two decades ago. After adopting a new National Mass Communication Policy, its philosophy and principle can then be the basis of a new legisl ation for NBC in a similar fashion that the NTP informed many provisions of the new Communica tions Act that was passed in 2003. One major area that needs attention is the granting of br oadcast licenses about which the Commission is handicapped by a constitutional provision and am ending the constitution, needless to say, is a herculean task. However, there seemed to be an interim measure th at can enhance NBCs licensing power based on the Constitutional prov ision which said: no person, other than the Government of the Federation or of a State or any other person or body authorised by the President on the fulfilment of conditions laid do wn by an Act of the National Assembly, shall
167 own, establish or operate a television or wireless broadcasting st ation for, any purpose whatsoever, (emphasis mine). What the nationa l assembly could do in the process of amending the current NBC Decree is to requi re that any applicant who fulf ills the condition laid down must be granted license within 90 days subject to the availability of frequency and where the president does not give express approval to the NBC recommendation within 90 days he would be deemed to have given the approval. Also, the new NBC Act should expressly prov ide the only conditions under which the president may withhold a pproval of the NBC recommendations. A broadcast regulatory area that needs some revision is the local content requirement. Currently, the requirement for 60% local content in radio and television is too vague and open to wide interpretation to encompass any program produ ced in Nigeria. Thus, all that broadcasters do is show lousy entertainment and engage in program length commercials and paid-for political talk shows. It would be more meaningful if the NBC will provide additi onal criteria within the local content to require devel opment communication that addresses the specific developmental needs of an agrarian nation like Nigeria. Simila rly, the 20% local content requirement for cable and satellite service pr oviders is not only too low but also does not serve any good purpose other than provide cheap Nigerian-produced entert ainment. The NBC should borrow from United States must carry rules and impose similar requ irements that Nigerian cable and satellite providers must also broadcast the signals of the leading local broadcaster in the vicinity of the cable/satellite provi ders operations. There is the need for both NBC and NCC to be more proactive regarding rural broadcasting and rural telephony. A nation where 70 % or more of its citizen s dwell in the rural areas cannot afford to neglect the informati onal and communications needs of those rural dwellers. Communications regulatio n may borrow from the Nigerian banking reforms of the late
168 1980s and early 1990s that among othe r things required major banks to have a certain percentage of rural presence among their br anches. For example, NCC may mandate the leading telecom service providers to dedicate a cer tain percentage of their subscr iption for servicing rural areas. Similarly, since only two broadcast licenses can be granted to a person, NBC Decree should be amended to allow the granting of a third license to those holding two licens es provided the third license is going to be us ed for rural broadcasting. Finally, the convergence of media and co mmunication technologies is increasingly necessitating what some experts call convergence regulatio n; which, among other things, suggests that all communication regulatory agencies should be merged. The imperative of such merger is obvious to any policy observer not only because of the convergence argument but also because of the efficiency and pooling of expertise working on similar issues. However, the way and manner it has been pursued by the last admi nistration is undoubtedly one of the unnoticed criminalities of Obasanjo: how can the government commence the merger of two separate agencies created by different laws with different mandates, wit hout an enabling legislation to that effect? Suggestions for Further Studies This dissertation employed legal and policy research me thodology to examine Nigerias communications policy regulatory reforms of the 1990s and early 21st century. Since the dissertation relied a lot on documentary research, a further study may be needed that will examine the independence of NBC and NCC ba sed on their regulatory interventions, their actions and inactions, rather than based on the policy instruments establ ishing the agencies. Further, another study may also help to il luminate the constrai nts encountered by the agencies in their operations. Relatedly, there is need to examine the relationship between
169 regulators and regulatees, i.e., in general is it cordial or adversarial? Which regulations do the industry find burdensome? And which provisions are the regulators finding flaunted? There is also the need to examine the fe w but increasing revolving door phenomenon of movement of personnel between agencies and the regulated industry. It will be interesting to uncover which way has the higher traffic: industry staff to moving to regulatory agency or vice versa? In the same vein, it will be useful to uncover the differences in the perception of the industry among the regulators betw een those who have worked in the industry and those who did not.
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178 BIOGRAPHICAL SKETCH Abubakar Danlam i Alhassan received his Bachelor of Arts degree in mass communications from Bayero University, Kano, Nigeria and a Master of Arts in communication studies from Western Michigan University, Kalamazoo, before comp leting his PhD in mass communication at the University of Florida. In addition to the Ph D in mass communication, Abubakar Alhassan also completed a graduate certificate in African studi es. His research interests broadly encompasses communication law, policy, and regulation as well as international communication and public broadcasting.