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In recent months, Nigerians have faced a dramatic increase in the cost of mobile data subscriptions, causing significant hardship for small and medium-sized business owners. This price hike followed a 50% increase in telecom tariffs authorized by the Nigerian Communications Commission (NCC). Despite the telecom industry’s request for a 100% hike, the approved adjustment has made internet connectivity increasingly difficult to afford. As a result, many small businesses have been forced to turn to limited data plans to keep their operations running. This article explores the impact of these price increases on Nigerian businesses and the broader telecom sector.
the Issue
The rising cost of mobile data has had a profound effect on small and medium-sized business (SME) owners across Nigeria. These businesses, which rely heavily on affordable internet connectivity, have been hit hard by the increase in data subscription fees. As of December 2023, there were over 224 million telecom subscribers in Nigeria, with MTN holding the largest market share at 38.79%.
The decision by the Nigerian Communications Commission (NCC) to approve a 50% hike in telecom pricing, instead of the 100% increase that telecom companies had requested, was met with mixed reactions. While the telecom providers welcomed the increase, many consumers, especially small business owners, voiced their displeasure.
One such business owner, Hassan Alabi, a Point of Sale (POS) attendant, expressed his frustration at the skyrocketing costs. He described how a N5000 data subscription, which previously lasted him a month, now only lasts a few days. Even though Alabi switched to a different internet provider, he mentioned that the rollover plan and double data option offered some relief, but it wasnāt enough to offset the sharp rise in costs.
Another business owner, Olu Ojeniyi, who runs Bikita Studio, reported a sharp price increase from N2000 for a one-week data bundle to N9000 for just 15GB. This increase has become a financial burden, restricting internet usage and impacting his business operations.
The situation is further complicated by issues with telecom service providers. Prince Sina Bilesanmi, President of the Association of Telephone Cable TV and Internet Subscribers of Nigeria (ATCIS), expressed concern about the increased operational costs faced by telecom companies, stating that over 60,000 jobs could be at risk. Despite these challenges, Bilesanmi remains hopeful that telecom providers will fulfill their promises of better service.
As of January 2025, 9Mobile saw a significant loss in subscribers, with many customers reportedly unable to switch networks due to what some experts suspect is deliberate blocking by the telecom provider. This issue has led to calls for intervention from the NCC, with subscribers demanding more transparency and better service.
What Undercode Says:
The ongoing rise in data prices in Nigeria is not just a concern for business owners but for the broader telecom industry as well. Telecom companies in Nigeria have been facing increased operational costs, which have been passed down to consumers in the form of higher data prices. While the industryās request for a 100% increase in tariffs was not granted, the 50% hike that was approved still caused considerable disruption.
One of the significant challenges here is that small businesses are now left struggling to maintain internet connectivity while managing their operational costs. For many SMEs, access to the internet is crucial for communication, financial transactions, and marketing. The rise in prices makes it even more difficult to stay competitive, especially when these businesses are already operating with tight margins.
From a consumer perspective, the sudden jump in data costs has led to frustration, with many accusing telecom companies of taking advantage of their monopoly in certain regions. These service providers have been accused of poor service quality, with many customers citing unreliable networks, slow internet speeds, and dropped calls. The impact of these poor services is compounded by the cost increase, leading to even more dissatisfaction among users.
Small businesses have found themselves at a crossroads: either they continue to pay higher prices for unreliable service or seek alternatives. Some have chosen to shift to smaller, less expensive providers, even though these options are not always ideal. For example, Spectranet has provided a solution with rollover plans and double data packages, but it remains a secondary choice for many businesses.
Telecom companies, in turn, have been increasing their infrastructure investments in an attempt to justify the price hikes. However, it remains to be seen whether these improvements will be sufficient to restore consumer confidence in the services they offer.
The issue of job losses due to increased costs is another area of concern. If telecom companies face significant customer churn or are forced to raise prices even higher to maintain profitability, the resulting fallout could lead to widespread layoffs. This would only exacerbate the already precarious financial situation that many Nigerians are facing.
Moreover, 9Mobileās recent subscriber losses and the accusations of blocking porting requests further illustrate the growing dissatisfaction with Nigeriaās telecom industry. The companyās failure to retain customers amidst ongoing infrastructure issues raises important questions about the future of competition and consumer rights in the Nigerian telecom market.
Fact Checker Results:
- The official NCC data confirms that Nigeria has over 224 million telecom users, with MTN being the market leader.
- The increase in telecom prices was approved as a 50% hike, down from the 100% increase initially requested by telecom providers.
- Concerns regarding 9Mobileās subscriber losses and allegations of blocked porting requests have been raised by customers and experts alike, suggesting issues with infrastructure and service quality.
References:
Reported By: https://www.legit.ng/business-economy/technology/1646205-nigerians-find-alternatives-cost-data-mtn-airtel-unbearable/
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