The biggest independent tower company (towerco) in the country, ATC Ghana has said that it did not cut off Surfline and Busy Ghana but had to discontinue pre-financing electricity bills and fuel cost for their equipment because they have for several years refused to meet their financial obligations to the company.
Surfline and Busy Ghana have for several months been out of service, leaving their customers stranded with very little or no explanation as to the actual cause of the outage. Surfline in particular, kept telling customers they were facing a technical challenge that will be fixed soon but till date the service has not been restored.
Meanwhile, the industry regulator, National Communications Authority (NCA) is currently in talks with Surfline on the way forward, including delinking SIM cards on Surfline and removing same from the Central SIM Register.
Techfocus24 gathered that the main reason Surfline and Busy Ghana are off air is because ATC Ghana, which is the main tower company running co-location towers in Ghana, had cut them off for non-payment of hosting fees and utility bills.
But in response to a questionnaire from Techfocus24, the company stated categorically that “ATC Ghana has not cut off Surfline and Busy Ghana but has discontinued pre-financing and funding the supply of electrical power and fuel to their equipment.”
The company explained that all the equipment of Surfline and Busy Ghana still remain on the premises of ATC Ghana towers, except that the supply of power and fuel to keep them running have been stopped due to non-payment of bills for many years.
According to them the discontinuation followed the persistent refusal of Surfline and Busy Internet to pay ATC Ghana for the electricity services despite ATC Ghana having already paid ECG, purchased diesel and incurred cost in maintaining the generators to provide services to the two companies.
Regarding Surfline specifically, the company said, following protracted discussions spanning over 7 years on Surfline’s refusal to pay agreed fees due ATC Ghana, including the fee of its power consumption, ATC Ghana at the end of January 2023 discontinued the pre-financing of supply of power to Surfline’s equipment on ATC Ghana’s sites.
“During this period, the many concessions, discounts and frequently renegotiated payment plans in support of Surfline were consistently breached,” it added.
With regards to Busy Internet, ATC Ghana said in September 2022, it was compelled to discontinue pre-financing the supply of electrical power to Busy Internet’s equipment for the same reasons.
“ATC Ghana fully funds the purchase of electricity from ECG and diesel to power generators to provide back-up power to Busy Internet. However, Busy Internet only pays for these services intermittently – in less than the agreed amounts or most often none at all. This is despite the many concessions and discounts made in support of Busy Internet’s business,” it said.
The company said it had a commitment to the telecommunications industry and must ensure that it is in a position to be able to continue to support the entire industry to deliver world class wireless connectivity to the wider Ghanaian society, adding “It is therefore important that ATC Ghana’s business continues to be sustainable by plugging the holes that cause financial losses to the business and not put the wider industry in jeopardy.”
AirtelTigo and Vodafone
Meanwhile, AirtelTigo is said to owe a much bigger debt to ATC Ghana than what Surfline and Busy Ghana owes, while the debt of Vodafone Ghana is also said to be piling up hard and fast, yet the two telcos continue to receive services from ATC Ghana.
But the company explained that “The case of AirtelTigo is different from Surfline and Busy Internet based on where we are in discussions with the relevant parties. As you know, the Government of Ghana completed the takeover of 100% shares of AirtelTigo in 2021 including customers, assets, and liabilities. ATC Ghana is in ongoing conversations with the GoG with respect to this issue.”
With regards to Vodafone, which has now been acquired by the Telecel Group, the company said “We are working with Vodafone Ghana to meet their financial obligations to ATC Ghana.”
Other Allegations denied
ATC Ghana had also previously been fingered for allegedly abusing its dominance as the leading co-location towers market shareholder to short-change smaller operators in favour of the big boys in the telecoms market, particularly MTN. The company has employed staff of MTN from which it purchased 1,800 towers, and has signed a lease-back agreement with MTN, on the back of which it is allegedly short-changing smaller operators.
It was also alleged that the company had a 300 minimum towers policy as part of its co-location arrangement, which compelled any operators wanting to be part to sign on to at least 300 towers. Indeed, high tower fees is another charge directed at ATC Ghana, and Glo Ghana in particular complained of “ridiculously high” tower fees from ATC Ghana, for which it opted out of the co-location arrangement.
Also Read: ATC Ghana’s de facto SMP status and implications for smaller operators
But the company said its pricing is in line with industry standards, saying that it does not charge each operator the same fees. The fee charged to each customer, according to ATC Ghana, is determined by different factors including without limitation to their equipment loading or tower space occupied, power consumed, volumes committed and duration of contract.
“The fee for each customer is thus different based on the different contributing factors with prices in line with industry standards,” it said.
The company also flatly denied having any 300 minimum towers policy saying that “ATC Ghana does not have a 300 minimum tower policy for its customers or any potential customers.”
It explained that its business model is co-location, which allows operators in the telecommunications industry to reduce their capital expenditure and operational cost by sharing infrastructure, adding that a 300 minimum tower policy would go against the multi-tenant business model and defeat the basis of the company’s operational and business model by being a disincentive to potential customers.
The company said any tower lease agreement ATC Ghana negotiates with a customer, based on the customer’s objectives and requirements, is in line with the network rollout/expansion plans of that customer, adding that “No two agreements are the same in terms of the number of co-locations from a customer, and ATC Ghana does not have a policy on a minimum number of co-locations for any customer.”
Also Read: Co-location tower cost suffocating smaller operators
With regards to the number of towers it controls, it said the figure is about 59% and not over 80% as alleged, adding that it also manages and maintains some towers on behalf of other companies, but does not own those towers.
It also explained that ATC Ghana employees, whether former employees of MTN, Vodafone or any other customer, work in the best interest of ATC Ghana and not for the benefit of any operator, as they are required to do by law and by the company’s business conduct policies, which, in many cases, go beyond the law.
Regarding the lease-back agreements and how it impacts other operators, ATC Ghana said it puts integrity first and therefore treats all its customers equally and fairly, adding that there is no favourable treatment of any operator based on ATC’s acquisition of towers from them.
It explained further that ATC Ghana entered the telecommunications industry in Ghana through the acquisition of approximately 1,800 towers from MTN Ghana in a sale/lease-back agreement, which is a standard approach adopted by most tower companies to enter a market and is not peculiar to Ghana or even Africa, adding that lease-back agreements are not specific to the telecom sector and does not mean that any customer is given a preferred treatment over another.
SMP calls
Calls have also been made for ATC Ghana to be declared a significant market power (SMP) in the towerco space so that appropriate measures will be applied in the interest of smaller operators like Surfline and Busy Ghana, which are now out of service for their indebtedness, while relatively bigger players like Vodafone and AirtelTigo who are also indebted to ATC Ghana are still operational.
To that call, ATC Ghana said “the determination of an SMP sits with the regulator and not the operator. Whilst ATC Ghana may have a bigger market share, ATC Ghana does not abuse its role in its pricing and the way we carry out business. We fully comply with the rules set out by the regulator.”
Also Read: Correcting the telecom market imbalance – the co-location tower cost factor
