The Nigerian Communications Commission (NCC) has recently approved a 50% increase in tariffs for telecom services like calls, SMS, and internet bundles after 11 years of negotiations. This decision, though seen as progress in addressing financial strains in the sector, falls short of the 100% hike that industry players had been advocating for.
The tariff adjustment will allow operators to modify prices within the established tariff bands, as outlined in the NCC’s 2013 Cost Study. While the exact date of implementation was not specified in the recent announcement, major operators like MTN are expected to roll out the increase within a week.
Industry stakeholders emphasize that while the tariff hike is a step towards bridging the revenue and operational costs gap, it does not fully resolve the sector’s challenges. Issues such as multiple taxation, protection of telecom infrastructure, and uniformity in the right of way for infrastructure are considered crucial for improving service quality in the long term.
The tariff increase is part of a broader strategy to ensure the sector’s sustainability, with operators like MTN and Airtel expected to utilize the additional revenue for capital investments aimed at enhancing service quality. The NCC has provided a three-month window for operators to recover losses before shifting focus to service quality improvements.
Despite the positive impact of the tariff hike, the telecom industry in Nigeria faces broader economic challenges due to currency devaluations, inflation, and the removal of fuel subsidies. Operators believe that fully deregulating the sector could be a long-term solution, allowing prices to be determined by market forces rather than a centralized tariff system.
Implementing a fixed approval timeline for tariff hikes is another proposed solution to streamline the process and provide operators with more flexibility in adjusting prices based on economic conditions. The overall goal is to create an ecosystem that supports sustainable growth and high-quality services for Nigerian consumers.