Anxiety as Telecoms Industry Awaits New Tariff Regime

Barring any unforeseen circumstances, a new tariff regime for data and voice services from telecom operators is expected to become effective in the next nine days.

Specifically, on December 13 a new tariff regime is expected to be announced by the telecoms regulator, the Nigerian Communications Commission (NCC).

Coming under the Tariff Simplification, this is expected to ensure that mobile network operators (MNOs) – MTN, Airtel, Globacom and 9mobile and other players in the sector come out straight and clean on what they offer to about 157 million active subscribers.

The simplification is expected to reduce the current perceived over-bloated tariff plans from about 369 to just seven, which will be bundled in about 100, including SMS, data and promos, for better understanding of the users and easy monitoring by the NCC.

Checks by The Guardian showed that MTN, the largest operator, currently has 159 tariffs, 14 for voice and 145 for data. Airtel has 27 for voice and 41 for data services. Globacom has six for voice and 32 for data, while 9mobile has seven voice plans and 97 for data.

On the planned simplification, the Executive Vice Chairman/CEO of the NCC, Dr. Aminu Maida, said at a forum in Abuja that the Commission engaged stakeholders extensively to gather their insights and ensure robust contributions before developing the simplification.

He disclosed that Tariff Simplification should have been out and running since October 27, “but due to incomplete consultations with and among the stakeholders in the telecoms industry, we had to shift the date to December 13, 2024.”

However, the anxiety surrounding the new planned regime has been whether it will lead or somehow enable an increase in tariff as clamoured for by telecoms operators.

Hitherto, the Association of Licensed Telecom Operators of Nigeria (ALTON) has called for an upward review of the current tariff, stressing that the last hike was 11 years ago. Sister bodies including the Association of Telecoms Operators of Nigeria (ATCON) and the National Association of Telecoms Subscribers of Nigeria (NATCOMs) have equally stressed the need for an upward review. NATCOMs even appealed to NCC to allow a marginal ‘10 per cent’ increase, saying this would enable operators to cover their increasing capital expenditure.

Speaking with The Guardian on Monday, ALTON Chairman, Gbenga Adebayo, said tariff simplification is a talk that has been going on for some time because the regulator felt the tariffs are complicated for users to understand.

Adebayo said: “Prior to now, people had it that there are multiple layers of tariffs (data and voice). The regulator wants us to make it as simple as possible, our understanding is that it is the simplification that will take effect from December. We have not heard from the regulator about a possible hike. But the sector can only be hopeful that soon, they will look in that direction.”An official of one of the telecoms firms, who spoke on condition of anonymity, said the new tariff simplification may increase the cost of mobile calls, data and SMS as the new plan takes effect later this month.

According to the official, while the plan is aimed at simplifying tariff structures and improving consumer experience across the industry, the interest of players in the sector should also be considered. “Operators are in dire need of a tariff hike to balance their costs too. Virtually, all the sectors of the economy have increased their tariff, except for the telecoms sector. Something needs to be done about it positively for the continued sustenance of the sector.”

Another operator in the Internet Service Provision space said a tariff hike is needed to sustain the growth of the sector.

While appreciating the clarity the planned Tariff Simplification would enable, especially for consumers and quality of service, which are not bad, based on a regulatory point of view, he however, noted that “diesel price has increased, while the foreign exchange rate is on the rise daily, same with interest rate, but nobody appeared to be listening to the operators. When the price of petrol was increased, there was no seeking public opinion, monthly, bankers met at the Monetary Policy Committee level, and they increased the cost of borrowing money, all of these are high, and virtually everything has increased. The last tariff of the telecoms sector was reviewed in 2018; the sector should be listened to as well.”

According to him, operators have made several presentations to the regulator, this new plan is ambiguous, and “we don’t know whether they are releasing that together with the tariff hike we have been talking about. Some kinds of confusion and anxiety currently pervade the sector. But December is here, we hope for the best.”

He added that some people in the know are also of the opinion that in the process of simplification, the tariff increase may be stylishly introduced.

The Guardian