Telecom operators have warned that the failure to implement the proposed 50 per cent tariff hike could push Nigeria’s telecommunications sector toward financial collapse, potentially leading to widespread network failures.
Industry leaders say rising operational costs and an unsustainable tariff structure are threatening the viability of telecom services. They argue that without a price adjustment, the sector may slide into insolvency, which could take years to recover from. The warning comes as the Nigeria Labour Congress (NLC) plans mass protests against the tariff increase.
Speaking at a forum with telecom CEOs over the weekend, the Chief Corporate Services and Sustainability Officer at MTN Nigeria, Tobe Okigbo, painted a grim picture of the industry’s future if pricing issues remain unresolved. He noted that while the cost of essential goods like tomatoes, bread, and potatoes has surged by over 100 per cent in the past year, telecom tariffs have remained unchanged.
“The discussion should not be about whether we should increase prices; it should be about whether we want a telecom sector that continues to drive the Nigerian economy. If operators can no longer sustain services due to financial strain, the cost of restoring the industry will be immense,” Okigbo stated.
Unlike electricity, where individuals can rely on generators during outages, telecommunications has no alternative backup. If the network fails, businesses, financial transactions, and everyday communication would be severely impacted. The industry is proposing a 50 per cent tariff increase, which Okigbo insists is about survival rather than profit. He explained that the adjustment is necessary to keep networks running, improve service quality, and expand coverage to rural areas where millions remain unconnected.
He further revealed that a cost study conducted in 2021 recommended a 100% increase in tariffs, but the government only approved a 50 per cent hike, which was never implemented due to concerns about affordability.
Chairman of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), Engr. Gbenga Adebayo, also raised concerns over the financial health of the sector, warning that continued losses could lead to widespread insolvency.
“The telecom sector is the superhighway of the economy. If it collapses, the entire economy will suffer. The number of telecom operators has already declined due to financial pressures. Without urgent action, the sector could hit a tipping point from which recovery would be extremely difficult,” Adebayo cautioned.
He dismissed arguments that telecom prices should remain low due to economic hardship, insisting that operators cannot continue to subsidize services at their own expense. “If prices stay unsustainably low, service quality will deteriorate, and ultimately, the industry will collapse,” he warned.
Following government approval for a 50 per cent price increase, telecom operators have submitted tariff adjustment proposals to the Nigerian Communications Commission (NCC). The Chief Customer Relations and Experience Officer at MTN Nigeria, Ugonwa Nwoye, confirmed that the regulatory process is underway, with phased price adjustments expected within the next few weeks and full implementation likely by February.
Operators have assured subscribers of transparency in communicating the new rates while working to minimize service disruptions.
