Oxygen Broadband’s Wi Fi hotspots aim to connect Nigeria and its entrepreneurs

Getting access to a fast and affordable internet connection in Nigeria is still problematic. To solve this, internet provider Oxygen Broadband is aiming to supply affordable and reliable broadband to Nigerians through the deployment of Wi Fi hotspots. Four months ago, it launched the first metro Wi Fi hotspot at the Ikeja Computer Village; a popular district for IT-related trade and services in Lagos. How is this initiative helping Nigerian tech entrepreneurs?

Focusing on densely populated areas, Oxygen Broadband is deploying several Wi Fi hotspots spread across the Nigerian commercial capital. The company is targeting countrywide expansion by 2014. “Until we have a hotspot 10 to 20 meters from you, that’s the Oxygen dream,” the CEO and co-founder Wale Adalemo says.

“Oxygen is Nigeria’s first metro Wi Fi provider. We have our first hotspot at the Computer Village with 35,000 devices connected. By December we want to be in 20 locations. By June next year we want to be in 200 locations in Lagos. At the end of 2014, we want to have 1000 hotspots across Nigeria. And that’s our dream and passion, getting millions of Nigerians on true broadband using the Wi Fi technology.”

How it works

To get access to an Oxygen Broadband Wi Fi network, a user only needs a Wi Fi fitted device. A first time user within the network will have to register. Once registered, you are subscribed to the service and can top up at any time depending on the value of your voucher. Internet access ranges from 30 minutes to 360 hours with a 30-day validity period. Unlike other service providers, a connected subscriber with Oxygen enjoys unlimited data downloads, irrespective of the plan.

Wande explains: “We have software that allows you to securely access our network, so that your phone number is your username. So if anything happens we know exactly who you are and what you are doing online and because all phone numbers are registered anyway with the NCC, so we are safe. But more importantly, we have price points that are pretty much affordable.”

High speed internet

Partnering with undersea cable company MainOne, Oxygen Broadband deploys a 4G Wi Fi technology and guarantees data download rate of 1 megabyte per second. At its office in Lagos, using a laptop, we watched a YouTube video and streamed an online radio station. The result was an uninterrupted high speed internet experience. But could Oxygen face the issue of bandwidth over-subscription with increasing subscribers?

Wande says that “the reason why other provider have over-subscription is because of the limiting nature of the technology that they have chosen to use. What Oxygen deploys is carrier grade Wi Fi. It’s pretty much expensive. But as you can see, it works. Thousands of users can connect to that network.”

What are Nigerian tech entrepreneurs saying?

With Wi Fi hotspots spreading across the state, Sola Sunny, a budding tech entrepreneur who hopes to launch a sports fan website explains the barriers facing startups. “You want to power your website around the clock because you want to be on the net updating, trying to resolve issues,” he says. “If there’s no connection or low speeds then this becomes a big challenge. And the charges some of these so-called internet providers give is so cumbersome that it scares you.”

Working from a space equipped with high speed internet, Zubair Abubakar, who developed the Nigerian Constitution app, thinks a little differently. “For the BlackBerry users that download our apps, they already have mobile internet on their devices. So I don’t think it will make sense to pay extra for a hotspot. The only reason they will do that is if their internet doesn’t work well.”

Infrastructure and challenges

Oxygen relies on renewable energy and partners with VDT and a number of people to provide backhaul and infrastructure. Solar panels power all its base stations across the Computer Village where Wande says the company spent US$2-million dollars to get its first metro Wi Fi up and running. “We still of course need funding to expand as much as we want to. We know that once we get the funding, the people are there waiting to use the hotspots,” he adds.

WiFi vs 3G

On the competition with mobile 3G internet, Wande says that Wi Fi though Oxygen is cheaper. He explains that “for every one minute of call on the 3G network, the operator spends one Naira (as an example). For one megabyte of data, they spend 7 Naira for the subscriber. Now for the 2nd minute of call on the 3G network, it’s not 2Naira, it is 1Naira 50kobo or there about. But for the next megabyte of data on the operator’s network, it is not 14 Naira; it is 21Naira plus some additional costs. It becomes exponential for them because it is expensive. So for them, it becomes critical that they do offload to Wi Fi as soon as possible.”

Mobile phone carriers offering 3G mobile internet charge subscribers based on data downloads. Oxygen however offers unlimited data download and charges subscribers only for time spent using the internet. Subscribers who consume plenty of that would find Oxygen more affordable. For those who download very little data, 3G mobile internet may come cheap with flexible data plans on offer.

On the average, 3G mobile internet with 100MB data download limits and a 30 day validity period goes for 1000 Naira or US$6.33. An internet bundle plan with a 3GB download limit and a 30 day validity period sets the subscriber back by N5, 000 or US$31.60. Oxygen Wi Fi internet comes with unlimited data downloads and 360 hours of internet access with a 30 day validity period costs 4,500 Naira or US$28.50.

Growing subscribers and broadband penetration

Wande explains that various datasets claim that Nigeria has 43-million internet users, but according to him these are a false representation of internet penetration in Nigeria. “Those numbers are based on e-mail addresses and people have multiple e-mail addresses; based on Facebook profiles, but people have multiple Facebook profiles. So those statistics do not tell the true picture. We are a rural country. We do not have a high subscription rate. And that’s what Oxygen is trying to change.”

Broadband revolution

Olaotan Towry-Coker, CEO of Afritickets, an online ticketing and event promotion platform based in Lagos, says: “As an online tech entrepreneur my business is directly dependent on access to the world wide web. Our productivity and thus our bottom line are directly affected by it. Any downtime, whether on our end or on the end of the consumer can mean a break in a transaction.”

Olaotan believes all stakeholders must effectively tackle the issues of bandwidth, affordability and reliability of internet service in order for Nigeria to maximize the gains of a broadband revolution sweeping across Africa. “If these issues can be solved then Nigeria will be set for another boom possibly larger than the oil boom of the 70′s,” he says.

This article by Samuel Okocha originally appeared on Venture Capital for Africa and was published with permission.