Mobile data in Nigeria is one of the most affordable globally, averaging just US$0.38 per gigabyte, making it one of the lowest in Africa. This was confirmed by the International Telecommunications Union (ITU) in a report from the GSMA on “The Role of Mobile Technology in Driving the Digital Economy in Nigeria.”
According to the ITU, Nigeria has the lowest cost for a basic data-only package in West Africa, significantly lower than the average in Africa. In comparison, other African countries, such as Kenya, which averages US$0.59 per gigabyte, Ethiopia at US$0.68, and South Africa at US$1.77, have higher data costs. For reference, the United States averages around US$6 per gigabyte.
Despite having competitive and affordable data rates, Nigerian telecommunications operators are advocating for increased tariffs to cope with the sector’s current challenges, stemming from currency devaluation, inflation, and a recent economic downturn in Nigeria.
Dr. Karl Toriola, CEO of MTN Nigeria, discussed these obstacles during a recent interview on Channels TV. He emphasised how the telecom industry has faced numerous difficulties over the past year due to Nigeria’s economic conditions, pointing out the urgent need for tariff adjustments to maintain the sector’s viability.
“2024 has been particularly tough for the entire telecoms industry. As the largest operators, we managed to remain somewhat resilient, but it’s been a challenge,” Toriola noted.
He identified various factors contributing to the sector’s difficulties, highlighting that operational costs now exceed the revenue generated. “The rapid currency devaluation and inflation have significantly raised our operational costs. By the end of the year, we spend more to keep our services running than we earn, which is unsustainable,” he explained.
Toriola argued that a tariff increase would allow telecom operators to enhance their capacity to provide quality services, stating, “An adjustment in tariffs enables us to reinvest, ensuring we can build resilience and introduce additional power supply systems for more stable and quality networks.”
He warned that without these adjustments, telecom companies’ operations risk becoming untenable. “If an organisation spends 160% of its earnings, it will inevitably face shutdown. We are barely managing to sustain our networks, but we are not discontinuing services because we trust that we will eventually address the sustainability problem,” he added.
The federal government has recognised the necessity for tariff adjustments but has assured citizens that any increase will be modest and not as high as telecom companies’ proposed 100% surge. In a recent meeting with Mobile Network Operators, Minister of Communications, Innovation and Digital Economy Dr. Bosun Tijani stated, “Our aim is to strike a balance to protect our citizens while ensuring that these companies can continue their significant investments.”
As discussions on the telecommunications sector’s future progress, stakeholders work to balance operational sustainability and consumer affordability, ensuring that Nigeria’s digital landscape remains vibrant and accessible to all.
