Nigerian telecommunications companies have proposed a 100% increase in their tariffs to cope with rising operational costs, pending approval from the Nigerian Communications Commission (NCC). This development comes amid mounting financial pressures on the telecom industry caused by inflation, fluctuating exchange rates, and escalating energy costs.
The Chief Executive Officer of MTN Nigeria, Karl Toriola, disclosed the proposal during an interview on Arise TV on Thursday. Toriola emphasized the urgency of the tariff adjustment, describing it as critical to sustaining the industry.
“We’ve put forward requests of approximately 100% tariff increases to regulators. I doubt they’re going to approve that quantum of increases because they are very, very sensitive to the current economic situation in the country,” Toriola said.
Rising Costs Strain Telecom Operators
The telecommunications sector has faced significant financial challenges due to inflation, rising energy prices, and the depreciating value of the naira. The increased costs of diesel, power generation, and other operational inputs have further strained the industry.
Earlier this week, telecom operators warned that these rising expenses could lead to service disruptions if tariffs are not adjusted to reflect the current economic realities.
Gbenga Adebayo, Chairman of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), described the industry as “under siege.” He explained that while costs have soared, tariffs have remained stagnant for over a decade, making it increasingly difficult for operators to maintain quality services and expand their networks.
“Without an immediate tariff adjustment, operators may have to resort to service shedding, which could limit the availability of telecom services in certain areas,” Adebayo cautioned.
Balancing Affordability and Sustainability
Despite the financial strain, Toriola expressed optimism about finding a middle ground with the NCC and other stakeholders. He emphasized the shared goal of ensuring the sector’s long-term sustainability while considering consumer affordability.
“I believe we’re all on the same side—policymakers, regulators, and the industry. We share concerns about fundamental issues. Without a sustainable industry, the broader economy and the well-being of the people will be negatively impacted,” Toriola said.
The call for a tariff adjustment is not new. Operators first raised the issue in April 2024, but no significant progress has been made. In response to the worsening financial situation, ALTON and the Association of Telecommunications Companies of Nigeria (ATCON) issued a joint statement urging the Federal Government to engage in constructive dialogue with industry stakeholders.
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The associations stressed the importance of creating a framework that balances consumer affordability with operators’ financial needs, noting that tariffs have remained unchanged for 11 years despite economic changes.
Urgent Action Needed to Prevent Service Disruptions
Telecom operators have warned that failure to act could jeopardize the survival of one of Nigeria’s most critical industries. Without sufficient tariff adjustments, they say, operators may struggle to maintain operations, potentially leading to widespread service disruptions.
As the NCC reviews the proposal, stakeholders in the industry are hopeful that a fair decision will be made to safeguard the future of telecommunications in Nigeria. Toriola concluded, “This is not about short-term profitability; it’s about ensuring that the industry can continue to serve Nigerians effectively in the years to come.”
The telecom sector remains a backbone of Nigeria’s economy, and many Nigerians will be watching closely as the NCC considers the proposed tariff increase.