NCC approves 40% telecom tariff hike

The Nigerian Communications Commission (NCC) has approved the long-awaited telecom tariff hike, which is expected to increase by as much as 40 percent.

Under the revised structure, call charges are anticipated to rise from ₦11 to ₦15.40 per minute; SMS costs will increase from ₦4 to ₦5.60; and a 1GB data bundle will cost at least ₦1,400, up from ₦1,000.

New rates for calls, SMS, and internet bundles will take effect from January 2025, with tariffs expected to rise by 40 percent.

The NCC stated that it would provide more details in an upcoming official announcement, emphasising that the adjustments balance industry proposals with public interests.

“This will benefit both subscribers and operators, as we’ve considered feedback from all stakeholders,” an NCC spokesperson said.

The new tariffs have effectively ended months of speculation and concluded over a decade of lobbying by major operators like MTN Nigeria, Airtel, and 9Mobile.

The new tariffs are expected to relieve telecom operators who have been struggling with high operational costs.

The financial strain on telecom operators has been severe, with MTN Nigeria reporting a ₦514.9 billion loss in the first nine months of 2024, following a reported ₦137 billion loss in 2023.

Airtel Africa faced $89 million in losses for FY 2024, largely due to pressures from economic challenges in Nigeria.

The tariff increase, however, comes amid rising food inflation of 39.93 percent and concerns over reduced internet usage in a country prioritising digital inclusion.

The NCC has been cautious about overburdening subscribers, having previously rejected a proposed price hike from Starlink in October 2024.

The current economic conditions, including rising diesel prices and fluctuations in foreign exchange, have significantly impacted the profitability of telecom operators.

Minister of Communications, Innovation and Digital Economy, Dr. Bosun Tijani, acknowledged the need for the adjustment, citing economic pressures during a recent interview on Arise TV.

Gbenga Adebayo, President of the Association of Licensed Telecommunication Operators of Nigeria (ALTON), supported the tariff hike.

He believes that cost-reflective tariffs will incentivize investment and improve service quality in the long term.

Industry watchers also noted that the new tariff will enable telecom companies to recover their costs and invest in infrastructure development, such as expanding 5G networks and enhancing service quality.

This, they said, will in turn improve the overall telecommunications experience for consumers in Nigeria.

However, the telecom regulatory agency, NCC, has a critical role in regulating tariffs to ensure they are fair and reasonable for consumers.

The NCC must balance the need for telecom companies to generate revenue with the necessity to protect consumers from excessive price increases.

Approving new tariffs for telecommunications companies in Nigeria is essential for the industry’s viability, infrastructure development, and improved service quality.