Table of contentsIntroductionProblems or obstacles faced by the telecommunications industrySolutions to the problems faced by the telecommunications industryConclusionIntroductionWhat is investment?Say no to plagiarism. Get a tailor-made essay on “Why Violent Video Games Should Not Be Banned”? Get an original essay Investing according to wordweb.com is “the act of investing; placing money or capital in a business in the hope of making a profit.” This simply means that investing only takes place when one expects to make a profit. Here profit can take any form, it can be cash, social status, etc. Investment can only be measured over a period of time. These profits help countries solve economic problems such as lack of infrastructure, poverty, lack of education, etc. Economics and technology interact and constitute determining factors in the design of the telecommunications network. The optimal bandwidth capacity is determined based on market conditions and the desire of managers. have the flexibility to make decisions in response to changing market, regulatory and technological conditions. When these real options are exercised, management deploys the new systems and adopts a pricing strategy for the company under regulatory and market constraints. Telecommunications managers must make strategic decisions in an increasingly volatile environment where continuous investment in new technologies has become crucial for growth and satisfaction of customer demand. The factors that currently determine the investment decision-making process in the telecommunications sector are completely different from those that the sector used to consider in the early days of regulation and/or state control. What is telecommunications? According to wordweb.com, telecommunications are “systems used to transmit messages over a distance by electronic means.” This includes radio transmission media, etc. What is an industry? According to wordweb.com, manufacturing is “the organized action of manufacturing goods and services for sale.” In this context, industry refers to the combination of many companies dealing with a particular niche of products or services. In this report, we will mainly deal with the telecommunications sector. The objective of this report is to determine the investment value of telecommunications companies as a whole in order to decide the appropriate path to take to invest in them. Problems or obstacles faced by the Telecommunications Industry1. Performance measures: For quality investment decisions to be made in a chosen area, accurate and timely performance measures must be available and made available to the right people, for example potential investors. Performance is an organization's ability to acquire and manage resources in multiple ways to develop competitive advantage. Performance metrics should be an accurate measure of industry performance over a period of time. These metrics are then used as a tool to indicate trends or patterns of success/failure, which would facilitate financial decision making.2. Availability of Electricity: The cost structure of operators is also unfavorable and constitutes a major drawback in the quest to increase capital expenditure in the country. A key element of telecommunications infrastructure isthe base transceiver station (BTS), which essentially connects mobile phones to the network. However, it is important that the government demonstrates its commitment to significant growth in electricity generation and distribution. throughout the country. Genuine commitment and improvements seen in the power sector are expected to spur increased investment in the Nigerian economy. Among those who believe it would be difficult for operators to make more investments without a more favorable environment than is currently available more expensive than in other African markets due to the cost of fuel. It is estimated that Nigerian operators spend about N10 billion annually to power their base stations. There is arguably no sector in Nigeria that does not suffer from epileptic power supply. The problem has been recurring for years and it seems we are not making any progress. Without electricity, the telecommunications sector can make little or no progress. Electricity generation must be created to add to the existing energy we have. Telecommunications is scrambling for power and until there is an electricity solution, we may never have quality service. This is an area that the new board can work on by creating new energy production channels for telecommunications. The envisaged cost savings should be reallocated towards improving and deploying infrastructure for more efficient service delivery to customers. Around 15% of all BTS in the country's sector are connected to the electricity grid, making operators dependent on oil-fired sites. Fuel costs associated with operating BTS in the country represent approximately 60% of operators' network costs. To put things in perspective, network costs in Nigeria are approximately two to three times higher3. Vandalism of telecommunications facilities: Apart from financial difficulties, the current state of security of telecommunications infrastructure is not encouraging for any potential investor. Any rational and wise investor considers the safety of their assets when making an investment decision. Vandalism to telecommunications infrastructure sometimes occurs by mistake during excavation, but is most often perpetrated through acts of sabotage and theft of equipment. These acts of vandalism are common in rural areas of the country, characterized by high rates of poverty and unemployment. The low standard of living and lack of opportunities push young people to resort to such actions to extort telecommunications operators. In 2013, the Nigerian Communications Commission (NCC) noted that it had recorded about 1,200 fiber cuts in just a few months. Unknown to most Nigerians. , vandalism of telecommunications infrastructure constitutes a major problem. About 2-3% of Nigeria's BTS are closed at any given time due to vandalism, resulting in a loss of about $50-100 million every year. On the other hand, telecommunications companies have a higher investment value than banks, because telecommunications is not a depository institution and, as such, is not required to maintain high liquidity , which means that if the bank wants to maintain optimal profitability, it will invest all its funds in long-term assets. The actions of vandals generate significant expenses for operators in terms of repair and replacement costs, loss of income, but also “appeasement” costs. Inconclusion, it shows that the more fluid an organization is, the less profitable it is. Thus, telecommunications have a better return on investment, only the investor concerned about his liquidity will invest in the bank. Based on the results of the analysis, the researcher made the following recommendations.4. LACK OF GOVERNMENT SUPPORT: In recent times, telecom operators have been attacked by regulators or the government through fines and unregulated taxes. This does not provide the necessary incentive platform for investors to commit more funds to capital expenditures. The story of the telecommunications sector will resemble that of the Nigerian oil industry if an appropriate regulatory and tax structure is not designed and enforced by relevant stakeholders. In the past, telecommunications companies like MTN have been subject to harsh government policies and regulations that have in one way or another hampered their operations. If these issues are not resolved in the future, we could find ourselves in an even more rigid situation. positions regarding the telecommunications industry.5. LACK OF TELECOM INFRACTURE PROTECTION: The protection of telecommunications infrastructure in the country, particularly in remote areas, is a primary necessity for operators. There have been discussions recently about the possible adoption of a bill by legislators, which aims to give telecommunications infrastructure the status and legal protection of critical national infrastructure as well as other critical infrastructures such than electricity.6.STRONG COMPETITION AMONG TELECOM COMPANIES IN THE SECTOR: Delays in investments are also encouraged by market uncertainty due to the current antagonistic environment between operators, regulators and government. However, industry experts do not see the situation as a clear case of injecting more money. Some believe that a certain level of transparency and support needs to come from government to assure operators that such investments will not end in futility. Investors in the Nigerian economy are not new to these uncertainties, in the oil sector, about $100 billion of investments are underway. delayed due to the late adoption of the Petroleum Industry Bill (PIB), according to the International Oil Companies (IOCs). Such uncertainty in the telecommunications sector can have repercussions on the consumer. The United States, in the early to mid 1970s, was a perfect example of what market uncertainty can have. According to Jerry Hausman, an economics professor at the Massachusetts Institute of Technology (MIT), regulatory problems delayed the introduction of cell phones in the United States by 7 to 10 years. This delay would cost consumers between $31 and $50 billion (1994 dollars) each year. The bill is a step in the right direction; However, a delay in passage would put the $25 billion investment in the ICT sector at risk, as well as future investments for the foreseeable future. It is also important to recognize that passing the bill is not enough; awareness and enforcement are the real determinants of the bill's effectiveness.7. Insufficient Telecom Masts: Telecommunications companies should strive to build more telecom masts in order to eradicate Nigeria's black spots. We should be able to receive and call without any hindrance. Telecommunications companies can decide to share mastsin order to reduce costs. These are persistent problems among others that have persisted for years. Telecommunications is struggling with these issues, which has hampered the improvement of their service. No business would thrive in an environment where resources that could have been used to make system upgrades are diverted to paying repairs and debts. The new NCC board is expected to develop metrics to guide the sector's performance and challenges. This is the only way for them to know the current state of the sector. It turns out that there are multiple regulations aimed at stifling telecommunications companies. Some of these regulations should be reviewed and new policies created to address current issues in the sector. Just as the NCC should work on some of these points, telecom companies should look for easing measures to improve their services. The NCC should ensure active enforcement of deactivation of unregistered subscribers. In this way, poor quality of service would be reduced. The NCC should create channels and deploy base stations, masts and fiber optic cables to mobile operators to combat mobile blackspots. The challenge of poor quality of service in Nigeria's telecommunications industry is not impossible to overcome. All that is needed is cooperation among all stakeholders to come together and resolve the various issues. Solutions to problems faced by the telecommunications industry The telecommunications industry faces many challenges, which reduce the investment decisions made by potential investors in the sector, but there are approaches. and solutions that will alleviate these problems;1. Policy reforms: Previous amendments (e.g. the Nigerian Communications Act of 2003) are outdated as they focus on how voice calls are regulated and not on issues related to the new technological era. Today, the focus should be on competition in the sector, on the market and on other services to which the telecommunications sector is closely linked, such as financial, technology and media services. The current government has shown its commitment to creating an enabling environment for the private sector to contribute to innovation. solutions to enable consumers to benefit from advanced information and communication technologies (ICT). This will in turn drive efficiency and productivity in the telecommunications sector and ultimately enhance economic growth. To solve the problem of artificially low prices, a regulated minimum price level must be put in place by the government and regulators. Large and small telecom operators can compete on the quality of the network and customer services they provide. The sector regulator, the Nigerian Communications Commission (NCC), should ensure that the quality of service provided by telecom operators is improved with emphasis on the strength of their signals and the quality of their data services. Customers can also play a role in regulating prices by valuing and promoting services that provide the best customer experience and not those that only offer the cheapest price.2. Public Awareness: A comprehensive plan is needed to communicate to Nigerian residents the need to protect all critical infrastructure and the penalties for violating the law in the country.3. Government reforms: A fiscal and.