CEM REPORT, TECHNOLOGY | Mobile Network Operators (MNOs), have again lamented that the current pricing structure governing calls, short message service (SMS), and data services in the country is unstable.
Telecommunications stakeholders under the Association of Licensed Telecoms Operators of Nigeria (ALTON), stated that giving the state of the nation’s economy the present pricing scheme if not adjusted to suit present realities might affect the quality of service offered.
“What we are charging, today, is certainly not sustainable. It is only a matter of time; either it will impact the scale of service or the industry’s performance and service availability. But certainly, it is not sustainable…what we have currently. We are living on borrowed time.”
Speaking during the Nigerian Telecommunications Indigenous Content Expo (NTICE 2023) organized by the Nigerian Communications Commission (NCC), ALTON Chairman Gbenga Adebayo, called for dire attention to the challenges confronting telecom operators and the broader industry.
He held regulatory interventions accountable for contributing to the sector’s difficulties.
Adebayo hinted that comprehensive evaluations were in progress. He underscored that the prevailing rates within the sector cannot persist in the present environment.
“The current pricing regime in the industry is not sustainable. We are selling below cost. It is not easy to go about that, but market forces should be allowed to determine prices.”
Recall that the telecom industry had petitioned the Nigerian Communications Commission (NCC) in 2022 seeking approval for a substantial 40 per cent increase in the costs associated with calls, SMS, and data services.
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Telecom companies proposed adjustments to the price floor for calls, suggesting a hike from ₦6.4 to ₦8.95, and an increase in the SMS price cap from N4 to ₦5.61. The operators justified their petition by pointing out a 40 per cent increase in the cost of conducting business within the nation.
They further elaborated on the financial impact of Nigeria’s economic downturn in 2020 and the ongoing Ukraine/Russia conflict, which resulted in a 35 per cent surge in operational expenses due to heightened energy costs.
