Technology
Navigating the Path to Sustainable Telecom Services for Subscribers
By Dinesh Balsingh
As Nigeria continues its journey towards becoming a digitally driven economy, reliable telecommunications services remain the backbone of our collective progress. At Airtel Nigeria, we are committed to delivering world-class connectivity to millions of Nigerians, enabling economic growth, empowering businesses, and enhancing lives.
We understand that the future technology needs of the country, as ushered in by the highspeed 5G era of AI, Cloud computing, Data science applications, and Blockchain, should be directing significant investments towards building a resilient network. However, the industry faces significant challenges that require a closer look as we strive to maintain the high standards that our customers deserve.
Increased Intensity of Investments: The increasing demand for digital services across sectors such as education, media, banking, transportation, and manufacturing has come with an increased demand for telecom capacity.
Upgrading networks to deliver more data capacity is key to a sustainable future. To help ensure that the Nigerian economy keeps pace with the global improvements in technology and communications while supporting the aspirations of consumers, we also take on the responsibility of executing new technology and system upgrades as well as improved security. Data security is now more than ever a priority as more and more people upload personal information online.
All of these require significant investments which are sourced from the international markets at costs denominated in US Dollars. In the past three to four years, for instance, the dollar has gone from exchanging for about N500 to over N1,600. This more than three-fold increase in foreign exchange conversion exponentially increases the cost of investments required to run a good quality network.
In addition to this unprecedented hike in capital expenditure, the operating costs have surged dramatically, with operating expenses rising by over 300% in the last 18 to 24 months alone.
While several critical areas of the business are impacted, I would, for expediency, focus on three of those areas: Rising Energy Costs, Infrastructure Challenges, and a Commitment to Quality Service.
Rising Energy Costs: Powering telecommunication infrastructure requires significant energy resources. Energy is the single largest operating cost for running a network. With increasing global energy prices and while efforts are ongoing to fully stabilize the power supply in Nigeria, Airtel Nigeria and other operators in the sector are incurring soaring costs to keep networks running seamlessly.
Infrastructure Challenges: The industry continues to grapple with rampant fibre cuts and vandalization of critical infrastructure. These incidents not only disrupt services but also demand substantial investments to repair and maintain facilities.
Commitment to Quality Service: Despite these challenges, Airtel Nigeria has remained steadfast in ensuring quality of service. From expanding 4G and 5G networks to meeting growing demand in urban and rural areas, we have painstakingly absorbed the rising costs of these obligations to avoid compromising the customer experience and ensuring Nigerians, regardless of their location, have access to mobile communication and remain connected to the digital economy.
Telecommunications operators have worked tirelessly to sustain services despite keeping tariffs unchanged for the last 10 years. While tariffs have remained static for over a decade, the economic realities necessitate a review to ensure the sustainability of services hence our recent application to the government for tariff adjustment which if approved will be a step towards addressing this imbalance. It is not a decision taken lightly but one borne out of the need to guarantee continued investment in network expansion, technology upgrades, and improved service delivery.
The telecommunications sector is pivotal to Nigeria’s ambition to become a digital economy leader in Africa. Meeting this aspiration requires operators to make substantial investments in network infrastructure, spectrum acquisition, and innovative solutions. These investments come at a cost, one that must be shared proportionally to ensure long-term viability.
At Airtel Nigeria, we remain resolute in our commitment to:
Delivering Quality Services: The government continues to monitor operators’ compliance with service quality standards. Airtel is dedicated to surpassing these benchmarks, ensuring customers experience uninterrupted and superior connectivity.
Driving Economic Growth: By expanding our network and enhancing digital inclusivity, we are enabling the government’s economic turnaround agenda and fostering opportunities for all Nigerians.
Being a Reliable Partner: Despite industry challenges, we are steadfast in our role as a trusted partner in Nigeria’s digital transformation journey.
While significant tariff adjustments have become warranted for the sustainability of the industry, Airtel has always been sensitive to affordability and understands that the price adjustments must be done gradually to support our customers’ financial positions. We believe that approval of revised tariffs will empower operators to invest in capacity, expand coverage to underserved areas, aim for advanced security on the networks, and improve service quality and network availability while ensuring that Nigeria remains competitive in the global digital landscape.
As we navigate the present imperatives together, we urge all stakeholders, including customers, regulators, and partners to recognize the importance of building a resilient telecommunications ecosystem. Airtel Nigeria remains committed to delivering unmatched value while supporting the nation’s economic development.
Dinesh Balsingh is the Managing Director/CEO of Airtel Nigeria
By Adedapo Adesanya
The Nigerian Communications Commission (NCC) on Monday approved a 50 per cent tariff increase on calls, SMS, and internet data for telecoms companies in the company.
This comes after telcos suggested a 100 per cent hike in the tariffs, the first of such changes in over 10 years.
Despite the recommendation, the NCC was concerned about the impact this would have on Nigerians, who are battling a cost of living crisis.
The NCC rationalised the 50 per cent hike, saying it wanted to strike a balance between protecting consumers and ensuring the industry’s sustainability.
“The adjustment, capped at a maximum of 50 per cent of current tariffs, though lower than the over 100 per cent requested by some network operators, was arrived at taking into account ongoing industry reforms that will positively influence sustainability,” a statement from the NCC read on Monday night.
Recall that the Minister of Communications, Innovation and Digital Economy, Mr Bosun Tijani, has said the federal government may consider between 30 and 60 per cent hike in tariffs.
“I think it should not be more than anywhere between 30 and 60 per cent,” he said during an interview recently.
On his part, the Chief Executive Officer of MTN Nigeria, Mr Karl Toriola, said telcos are proposing a 100 per cent increase in tariffs to the Nigerian government.
He, however, pointed out that it won’t get such approval but said a substantial change, beneficial to all stakeholders, could be agreed upon.
It is not certain what the reaction of the telcos may be concerning this new development. If they disagree with the approval, it may lead to another round or dialogue or limitation of service offerings.
By Modupe Gbadeyanka
The acceptance of the Naira for payments for cloud services in Nigeria by global cloud leader, Amazon Web Services (AWS) has continued to excite its customers in the country.
Before now, Nigerians subscribing to the company’s cloud services were forced to purchase foreign currencies, particularly the United States Dollar (USD).
But to make transactions easier for its teeming clients in the country, AWS announced it was now accepting payments in local currency.
“With payments in their local currencies, customers can avoid foreign exchange costs associated with making foreign currency payments.
“This also removes payment friction for customers in countries where local regulations put limits on the foreign currency amount a customer can access,” the American firm said in a statement.
By lowering the barrier for Nigerian companies to pay for cloud services in their local currency, AWS has given itself an edge, but the growing local alternatives may still present a challenge.
The organisation said it is not just about price anymore—it’s about local relevance and helping businesses navigate the complexities of Nigeria’s economic environment.
The decision of AWS to accept naira payments comes in response to the growing appeal of local cloud providers in Nigeria.
Recall that in January 2023, the firm launched its AWS Local Zones facility in Lagos to reduce latency and improve performance for Nigerian businesses—often an important factor since many Nigerian companies host their services in AWS’s European region due to geographical proximity.
By offering a new payment option alongside this infrastructure, AWS can solidify its foothold in the Nigerian market, especially as local providers continue to present an attractive, economically aligned alternative.
“This is a welcomed development. We have been waiting for this to happen for a long time. I am glad it has finally become a reality. I don’t need to buy forex (foreign exchange) to pay for Amazon cloud services,” a tech enthusiast based in Lagos, Mr Kolade Adewale, told Business Post.
“I want to believe that the competition from Microsoft’s Azure may have forced AWS to include the Naira as a payment option. This is what competition does to the market. You can see such in the telecommunications and petroleum sectors with Dangote Refinery,” another tech enthusiast, Mr Goke Fashina, said.
By Adedapo Adesanya
The Minister of Communications, Innovation and Digital Economy, Mr Bosun Tijani, has said the federal government may consider between 30 and 60 per cent hike in tariffs and not the 100 per cent proposed by telecommunications companies in the country.
“I think it should not be more than anywhere between 30 and 60 per cent,” he said during an interview on Channels Television on Wednesday night, monitored by Business Post.
He said that even though the companies are insisting that a 100 per cent increase is what is needed to stabilise the sector, the government knows that such a level of increase will be harmful to the people.
“We have already made it clear that we are not going to approve 100 per cent. These companies are asking for 100 per cent, stating clearly that this is what they believe they need to get.
“But what we are looking at in terms of the sector is that if this is the sector that is responsible for driving growth in our country, it will be harmful to our people to allow MNO to increase by 100 per cent,” Mr Tijani said.
The Minister noted that the Nigerian Communications Commission (NCC) is still working on the tariff increase and is yet to arrive at a particular figure.
This points to continued standoff after it was widely expected that the tariffs will be announced last Friday.
According to him, it is necessary to look at the numbers, the implication any increase will have on the people and the sustainability of the sector for proper balancing.
Mr Tijani said that for mobile network operators to improve their service to the required standard, there is a need for them to keep improving their equipment.
Speaking recently, the Chief Executive Officer of MTN Nigeria, Mr Karl Toriola, said telcos are proposing a 100 per cent increase in tariffs to the Nigerian government.
He, however, pointed out that it won’t get such approval but said a substantial change, beneficial to all stakeholders, could be agreed upon.
“So, I’m not sure they will give us 100 per cent, but I am optimistic they will give us something substantial and maybe progressively over the course of the year we can have smaller adjustments that will help us to get back to where we need to be,” Mr Toriola said.
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