The Nigerian Communications Commission (NCC) recently reported that Nigeria’s internet consumption reached 973,455 terabytes in December 2024, a 36.5% increase from the previous year. 

That’s 998.79 million gigabytes of data used in just one month. Despite this surge in demand, the country’s broadband penetration stood at 44.43%, far below the 70% target set in the National Broadband Plan (2020–2025). 

Even more concerning, Nigeria ended 2024 with 164.9 million active telecom subscribers—down from 224.7 million the year before.

Imagine streaming a movie now costing as much as a meal, and staying online feels like a privilege reserved for the wealthy. 

This sharp decline in active subscribers, even with the growing need for internet services, is leading to talks of Nigerians being unable to afford staying connected.

Inflation and currency devaluation have shot the industry’s costs of operations really high, leading to the Nigerian Communications Commission’s (NCC) recent approval of a 50% increase in telecommunications tariffs—the first such hike in over a decade—to help operators manage the high expenses. 

The Need for Inclusive Resilience in the Telecom Sector

This tariff increase has struck conversations across various bodies. The Nigeria Labour Congress (NLC) has labelled the hike as “insensitive” and “unjustifiable,” especially given the current cost-of-living issue. 

While telecom operators argue that the challenges leave them with no choice, consumers are wondering if affordable connectivity is becoming a thing of the past.

Inflation is wearing out disposable income, forcing consumers to prioritise essentials over data and call plans. Businesses, especially SMEs, rely heavily on telecom services, but higher costs threaten their ability to stay competitive.

The rural-urban gap in connectivity may expand, as rural consumers—who already struggle with access—may be priced out of the market.

In the midst of these challenges, the telecom sector must find ways to remain profitable without sidelining lower-income consumers. The key lies in resilient and inclusive strategies that balance affordability, sustainability, and growth.

Strategy 1: Tiered and Flexible Pricing Models

1. The Power of Segmentation in Telecom

To effectively serve a diverse customer base, telecom operators should segment their users into low-income, middle-income, and high-income categories. This segmentation allows for targeted services that meet the specific needs and financial capabilities of each group.

2. Implementing Flexible Pricing Structures

• Pay-as-you-go options: Ideal for price-sensitive users who prefer to control their spending without committing to fixed plans.
• Subscription models: Offer middle-income consumers affordable packages with predictable billing cycles.
• Premium services: Provide high-income users with enhanced features such as high-speed internet and exclusive customer support.

3. Strategy 2: Infrastructure Cost Optimisation Through Public-Private Partnerships (PPP)

1. The High Cost of Expanding Telecom Network Infrastructure

Building and maintaining telecom infrastructure, such as towers and broadband cables, require huge capital investment. Inflation further increases these costs, making it challenging for operators to expand and upgrade their networks.

2. Leveraging PPP to Reduce Financial Stress

Collaborating with government entities and development banks can help telecom operators share the financial risks associated with infrastructure projects. For example, partnerships can be formed to extend network coverage to underserved rural areas, with shared investment and benefits.

In Kenya, the government and private telecom operators have partnered to expand rural connectivity, resulting in increased access to communication services in previously underserved regions.

Initiatives like the National Optic Fibre Backbone Project and partnerships with telecom providers such as Safaricom, Telkom Kenya, and Airtel have helped boost this.

Strategy 3: Digital Transformation and AI-Driven Efficiency

1. How Digital Transformation Can Lower Costs

Leveraging digital tools and automation can simplify operations, reducing the need for manual intervention and lowering operational expenses. For instance, AI-powered network management systems can optimise bandwidth usage and predict maintenance needs, thereby reducing downtime and associated costs.

2. The Impact on End-Users

Customers benefit from faster and more efficient services, such as AI-driven customer support that can handle inquiries promptly. These efficiencies can lead to cost savings for operators, which can be passed on to consumers in the form of more affordable services.

Strategy 4: Expanding Alternative Revenue Streams

1. Moving Beyond Traditional Revenue Models

Relying solely on voice and data services is becoming more and more unsustainable. Diversifying into areas like financial technology (fintech), cloud services, and the Internet of Things (IoT) can open new revenue streams. This is seen in MTN’s transition to a Techco.

2. Monetising Digital Services

• Mobile money and payment solutions: Offer financial services to unbanked populations, generating transaction fees.
• Entertainment bundles: Partner with streaming services to provide bundled offerings, enhancing value for consumers.

MTN’s MoMo, Airtel Money and Safaricom’s M-Pesa are prime examples of telecom operators successfully launching into mobile financial services, greatly contributing to revenue growth.

Strategy 5: Strengthening Local Supply Chains to Mitigate FX Risks

1. The Problem of Foreign Exchange Dependency

Heavy reliance on imported equipment makes telecom operators vulnerable to currency fluctuations, increasing costs unpredictably.

2. Investing in Local Manufacturing and Partnerships

Developing local production capabilities for items like SIM cards and network components can reduce foreign exchange exposure. Partnering with local tech firms can also promote innovation and cost-effective solutions tailored to the local market.

Strategy 6: Data-Driven Decision Making for Telecom Customer Retention

1. The Cost of Customer Churn in an Economic Downturn

Losing customers can be more expensive than retaining existing ones, especially when inflation reduces consumers’ disposable income. High churn rates force telecom companies to spend more on marketing and customer acquisition, which can negatively impact already tight budgets.

2. Leveraging Big Data and Analytics for Personalised Offers

Telecom operators can use customer data analytics to identify usage patterns, predict churn risk, and design personalised retention strategies.

• Usage-based incentives: Offering discounts or data bonuses to customers who frequently recharge can encourage continued engagement.
• Loyalty rewards: Retaining long-term customers through perks such as discounted family plans or exclusive streaming deals.

MTN and Airtel have successfully used data analytics to provide dynamic pricing models, such as location-based discounts and time-sensitive data plans, reducing churn and boosting customer satisfaction.

Strategy 7: Strengthening Regulatory and Industry Collaboration in Telecom

1. The Impact of Government Policies on Telecom Viability

Government policies on taxation, spectrum licensing, and price regulations are important in determining telecom sector stability. The recent 50% tariff hike approved by the Nigerian Communications Commission (NCC) is an example of how policy decisions directly affect consumers and telecom operators.

2. Advocacy for Fair and Sustainable Policies in the Telecom Sector

Telecom companies must engage policymakers and industry regulators in constructive dialogue to ensure that tariff adjustments, tax structures, and regulatory frameworks balance profitability with affordability for consumers.

3. Encouraging Investment-Friendly Policies in the Telecom Sector

• Reducing multiple taxation: Telecom firms should advocate for streamlined tax policies to prevent excessive levies that inflate operational costs.
• Incentives for rural expansion: Government support, such as tax breaks for rural infrastructure projects, can make connectivity more accessible in underserved areas.

Regulatory frameworks can encourage competitive pricing while ensuring telecom operators remain profitable.

Summary of Key Points

Though there are economic pressures like inflation, telecom operators can thrive and ensure inclusive connectivity by implementing seven key strategies:

1. Tiered and flexible pricing models to serve all income groups.
2. Public-private partnerships (PPP) to reduce infrastructure costs.
3. Digital transformation and AI for cost efficiency.
4. Diversifying revenue streams beyond data and voice services.
5. Strengthening local supply chains to reduce foreign exchange risks.
6. Using data-driven strategies to retain customers.
7. Collaborating with regulators to ensure fair pricing policies.

The Lot of Resilient Connectivity

With smart, adaptive strategies, telecom operators can continue to deliver quality services across all economic segments while mitigating the impact of inflation.

The telecom sector must act assertively by adopting innovative pricing, infrastructure investment, and customer-centric solutions. 

Regulators, industry leaders, and consumers must collaborate to ensure that connectivity remains affordable, sustainable, and inclusive—regardless of economic conditions.

Speaking on Thursday, NATCOMS President, Mr Deolu Ogunbanjo, described the planned protest as counterproductive and warned it could deter investors.

The Nigerian Communications Commission (NCC) had earlier approved a 50% increase in telecom tariffs, resulting from inflated costs of operations. This decision has led to mixed reactions, with labour unions and other stakeholders labelling the hike excessive and detrimental to Nigerian consumers.

NLC President, Mr Joe Ajaero, condemned the increase and urged the NCC and National Assembly to halt its implementation, proposing further discussions to arrive at a fair adjustment.

“This is for our dignity, our rights, and our survival as a people. The NLC remains resolute in defending the interests of Nigerian workers and the masses. We will resist this injustice and demand that the government prioritises the interests of its citizens over corporate interests,” Ajaero said.

The labour union has also encouraged Nigerians to consider boycotting telecom services in protest, describing the tariff hike as a burden on already struggling citizens. However, NATCOMS maintains that dialogue and legal moves, rather than protests, are the proper channels to address such issues.

“We do not support the Nigerian Labour Congress’ call for industrial action. No, we don’t! NATCOMS is not in support,” Ogunbanjo stated.

He noted that consultations with the NCC were ongoing, with a meeting scheduled to seek a resolution before the tariff hike takes effect. “If negotiations fail, we are ready to explore legal options to challenge this decision,” he added.

Defending its move, the NCC explained that the 50% adjustment was necessary to sustain the industry, given current economic realities. The commission further noted that some operators had initially sought a 100% increase but settled for a compromise after extensive consultations with stakeholders.

“The NCC has prioritised striking a balance between protecting telecom consumers and ensuring the sustainability of the industry, including the thousands of indigenous vendors and suppliers who form a critical part of the telecommunications ecosystem,” the regulator stated.

The commission assured Nigerians that the increase would enable operators to invest in infrastructure and innovation, ultimately improving service quality, coverage, and customer experience nationwide.

The buzz is everywhere and many are wondering why the naira is even being compared to the dollar since federal workers who initially earned the previous minimum wage of ₦30,000 are seemingly overjoyed.

But before you query further, look at today’s Nigeria, where the dollar plays an outsized role, affecting everything from the price of bread to rent. 

In 2014, Nigeria was Africa’s largest economy with a GDP of $568.5 billion. South Africa followed with $381.2 billion, Egypt with $321.6 billion, Algeria with $238.9 billion, and Angola with $145.7 billion. 

By 2023, Egypt rose to the top with $393.9 billion, South Africa maintained a close second with $377.7 billion, and Nigeria dropped to third with $374.9 billion. Algeria and Ethiopia followed with $244.7 billion and $159.7 billion, respectively. 

For 2024 estimates, South Africa’s economy became number one with $373.2 billion, Egypt at $347.6 billion, Algeria at $266.8 billion, Nigeria at $252.7 billion, and Ethiopia at $205.1 billion. This is according to data from StatiSense.

Also, the purchasing power of Nigeria’s minimum wage in terms of petrol (PMS) has seen a severe decline over the years. In 1999, a minimum wage of ₦3,000 could buy 150 litres of petrol. By 2000, an increased wage of ₦7,500 could purchase 341 litres. In 2011, with a wage of ₦18,000, workers could afford 277 litres. 

However, in 2019, despite a wage rise to ₦30,000, the purchasing capacity fell to 206 litres. In 2024, the new minimum wage of ₦70,000 only buys 93 litres of petrol, reflecting the huge impact of inflation and rising fuel prices on the real value of wages. What’s really happening?

The answer isn’t so simple. This new wage stacks up against the ever-rising cost of living, impacting businesses and the economy at large, and how Nigeria compares with other African countries.

There are complexities of wages and the never-ending issue of a better life in Nigeria, still, the dollar feels like gold. 

In the midst of all this, Aliko Dangote has halted his steel production plans following monopoly accusations from President Tinubu. We’ll get to that later. 

Striking a Balance: Navigating Nigeria’s Minimum Wage Debate for Economic Prosperity, Social Equity

Looking at Nigeria’s previous minimum wage, set at ₦30,000 per month, was established in 2019. At that time, the economy was facing low growth rates, high unemployment, and inflation, but not at a level as high as today. Inflation then was 11.40%, but today, it stands at 34.19%. 

The primary objective of the wage increase was to enhance the purchasing power of workers, reduce poverty, and stimulate economic activity, but things have gotten worse ever since.

The current agreement, according to the Nigeria Labour Congress (NLC), comprises a commitment to review the minimum wage every three years rather than every five years. 

This means the President will now adjust wages more frequently to keep up with inflation and economic conditions.

Cost of Living Analysis

To understand the impact of the new minimum wage, it’s essential to analyse the cost of essential goods and services before and after its implementation:

The price of foods such as rice, beans, and bread has greatly increased. For instance, as of July 18, 2024, a 50kg bag of high-quality rice costs ₦87,000 in Abuja, while it ranged between ₦78,000 to ₦85,000 in Lagos, Jos, Ilorin, Ibadan and Port Harcourt, among other states. 

This is a huge difference to earlier prices in 2019 where a 50kg bag of rice cost around ₦21,000. Even a loaf of bread is now as high as ₦2,000.

Rent prices have surged, particularly in urban areas. A one-bedroom apartment that rented for ₦200,000 annually in 2019 now ranges between about ₦500,000 to ₦1.5 million in Lagos State depending on the location.

Public transportation fares have doubled due to higher fuel costs. A bus ride that used to cost ₦100 now demands ₦300 and above.

The cost of healthcare services and medications has also risen sharply, making it more challenging for low-income earners to afford necessary treatments.

These increases show a big gap between wage growth and the rising cost of living, leading us to wonder about the real value of the new minimum wage.

Purchasing Power Comparison

Adjusting for inflation and the devaluation of the naira, the real value of the new minimum wage reveals its purchasing power. 

In 2011, the minimum wage was ₦18,000, equivalent to $117. By 2019, the wage had increased to ₦30,000, but due to currency devaluation, it was worth $98. Currently, the ₦70,000 wage, using the Central Bank of Nigeria’s exchange rate of ₦1,584 per US dollar, amounts to approximately $44.2. This figure is lower than expected, particularly considering the high cost of living in Nigeria.

For context, the price of a tuber of yam in the South East ranges from ₦7,000 to ₦12,000, depending on its size. The devaluation of the naira has unfortunately diminished the purchasing power of the new minimum wage. 

An analysis of the Nigeria Foreign Exchange Market (NFEM) reveals a decline in the naira’s value, making it difficult for workers to afford basic necessities despite the increased minimum wage.

Seeking individuals’ views, Lade, a single mother of two, works as a cleaner in Lagos. Despite the wage increase, she finds it hard to cover basic expenses. “The rent alone takes up more than half of my salary. After paying for food and school fees, there’s nothing left for emergencies. The new wage will help, but just a little, because everything has tripled currently.”

Emeka, a factory worker also says the new wage helps a bit, “but with the cost of everything going up, it feels like I’m running in place. It’s hard to save or plan for the future.”

Despite the wage hike, the price hike is unchanging. 

Nigeria’s Inflation Rate Up 34.19 % Amid Rising Cost of Living

International Comparison

Comparing Nigeria’s new minimum wage with those of similar countries gives us more insights. For instance, in South Africa, the minimum wage is about $248 per month, adjusted for purchasing power parity. In Ivory Coast, the wage is $125, in Togo it is $87, in Benin Republic, it stands at $86, Senegal at $75, Kenya at $116, Cameroon at $70, Morocco at $286, and in Seychelles, the highest, at $464.

Can you see that the purchasing power in Nigeria remains insufficient? 

For businesses, higher wages mean increased operating costs, which could lead to higher prices for goods and services. This, in turn, might contribute to inflationary pressures.

From an employment perspective, some businesses may struggle to absorb the increased labour costs, potentially leading to layoffs or reduced hiring. 

On the positive side, higher wages could boost consumer spending, driving economic growth and potentially creating more jobs in the long run.

But without corresponding productivity gains and economic reforms, the benefits may be short-lived.

For How Long Shall This Continue?

Robert Nesta Marley, the Jamaican social-political prophet, in his evergreen album “Redemption Song” released in 1980, must have thought about the prevailing ills of his time when he released a strong lyric that goes, “How long shall we kill our prophets while we stand aside and look?” With the accuracy of a Jewish prophet, Marley advanced the cause for redemption as indicated by the song’s title.

In the context of religion, a prophet sees ahead, predicts, and prescribes solutions. In business and entrepreneurial parlance, we believe “prophets” find solutions to pending situations, create opportunities when there are none, and subsequently ameliorate challenges for the people. 

Africa and Nigeria have been blessed with many such individuals, and it would be right to assert that Alhaji Aliko Dangote falls within this class by virtue of his investments and entrepreneurial wizardry.

The controversies that have surrounded the Dangote refinery, from scepticism and impossibilities envisioned by some armchair theorists and self-acclaimed social analysts, reflect this. 

Dubbed the eighth wonder of the world, with a production capacity of 650,000 barrels per day, the Dangote Refinery should prompt every serious person of African descent to interrogate what exactly our problems are and what we want as a people, despite campaigns of calumny from certain quarters.

Before the Dangote Refinery began operations, the Dangote Group was the highest employer of labour in Nigeria outside the federal government. It is a conglomerate with diverse interests in sectors such as cement, petrochemicals, sugar, flour, and salt production. 

The company employs over 50,000 workers across its different subsidiaries, and this is expected to increase with the Dangote Refinery, the largest in sub-Saharan Africa. 

According to information released six days ago, the $19 billion Dangote Refinery, reputed to be the largest in Africa and Europe, employs over 3,000 people. The fertilizer plant alone employs close to 1,500 directly and another 5,000 indirectly. 

While the politics surrounding the Dangote Refinery remain unclear, what is crystal clear is that it has generated employment opportunities and put food on the table for many, despite Nigeria’s hostile operating environment.

In the same vein, it is my firm belief that the proposed steel production, which was called off on the grounds of monopolising every aspect of the economy, after expressing readiness about a month ago, calls for serious soul-searching questions. 

There is no doubt that steel plays a vital role in the modern world. It is one of the most important materials for building and infrastructure, enabling a wide range of manufacturing activities and creating opportunities for innovative solutions in other sectors. It is also indispensable in research and development projects worldwide. 

Furthermore, a functional steel industry will serve as the backbone of Nigeria’s industrialisation if all the necessary parameters are put in place. The benefits of having a functional steel industry will translate to a functional country. 

The steel industry will contribute to all facets of the economy, including the important role it plays in economic development and growth, its multiplier effects in the development and sustenance of agriculture, healthcare, and virtually every other sector.

Dangote Halts Investment Plans in Nigeria’s Steel Industry

Are there records of remarkable breakthroughs in Nigeria’s steel industry yet? 

About eight months ago, the Federal Government of Nigeria allocated N4.45 billion to the moribund Ajaokuta Steel Company in the 2024 budget, seeking N35 billion from funding institutions to revive the light steel mill in the Ajaokuta Steel Plant, which has been dormant for over 42 years. 

It is significant to note that N4.45 billion for 2024 is higher than the N3.71 billion allocated to the company in 2023. However, juxtaposing the expenditure wasted by the federal government over the years with the trivial gains accrued from the industry, one could have envisioned that proposed steel production by Africa’s richest man would have brought succour or engineered a good start for private investors and entrepreneurs alike. But alas, the African billionaire has called off the initiative on the basis of being called a monopolist.

Much More than the Monopolist Claim

According to the Indian Economic Times, a monopoly market structure is characterised by a single seller selling a unique product in the market. 

In a monopoly market, the seller faces no competition, as he is the sole seller of goods with no close substitute. Factors like government licenses, ownership of resources, copyrights and patents, and high starting costs make an entity a single seller of goods. 

All these factors restrict the entry of other sellers into the market. Monopolies also possess some information that is not known to other sellers.

But the last time we checked, the government has not given anyone an exclusive right to venture into the steel industry. It seems to be like the Yoruba saying, “eni to ba la ya ko wa wo,” translated to English: “If you have the grit and expertise, you can venture.” 

Could it be that the constant frustration meted out by international oil companies and the supposed internal conspiracies experienced at the Dangote Refinery were covered up with something else?

Minus investment in the steel industry, plus the ₦70,000 new minimum wage, all you have is suffering and smiling.

Let’s say the monopoly justification adduced by Alhaji Dangote is something to go by. We are convinced that investment in the sector would have boosted employment opportunities for the teeming unemployed citizens in Nigeria. 

The question is, having witnessed the mass exodus of multinationals—up to the tune of 800 companies, with several others without clear records—are we supposed to have frustrated the good gesture of the entrepreneur? 

Like Microsoft, Apple, and Nvidia of this world, ours can start by providing a soft landing for the takeoff of conglomerates, not discouraging them in any way.

As a matter of fact, entrepreneurs in Nigeria are the real VIPs and should be treated as such. While we may be tempted to toe the line of the African billionaire on the basis of the monopoly alibi, we are sure that the birth of a steel industry would have at least paid more than the much-celebrated increase to N70,000 minimum wage. 

Whether the recipients of the minimum wage can lead a good life is still a long discussion, and we may need to wait and see how it pans out. 

If you can’t eat rice alone, the Iyaloja market already indicates that a big basket of tomatoes goes for ₦120,000. I will leave you with the prices of meat, fish, red oil, and a standard apartment in Nigeria. Then the question arises: how far can the minimum wage go?

Therefore, in line with the thought of Alhaji Aliko Dangote, we wish other daring African entrepreneurs who wish to venture into the steel industry the very best. 

Rounding off this piece, news just came in indicating Dangote’s interest in selling off the refinery, still on the basis of being dubbed a monopolist. We wait earnestly as events begin to unfold in the forthcoming days.

Many Twitter users expressed disappointment in the labor leaders’ acceptance of a “mere promise” from the government without a written and signed agreement. They raised concerns that such an approach might lead to a future revolution within the NLC.

Another common sentiment shared on Twitter was doubt regarding the outcome of the closed-door meeting with President Bola Tinubu. Twitter users questioned whether the labor leaders would call for further protests if the promised resolutions were not achieved, thus raising doubts about the effectiveness of the engagement and its impact on workers’ lives.

In addition, allegations of compromise emerged, with several Twitter users suggesting that the suspension of the protest was influenced by under-the-table deals or financial inducements. Such allegations raise concerns about the integrity and independence of the labor movement.

Some Twitter users also observed a familiar pattern in how protests are handled. They described a recurring script involving mobilizing for protests, holding closed-door meetings with authorities, issuing press statements calling for calm, and then repeating the cycle when needed. This observation raised skepticism about the effectiveness of protests in bringing about genuine change.

The urgency of restoring the subsidy was again highlighted on Twitter, with users expressing concerns about the immediate impact on Nigerians. Some suggested that President Tinubu should consider returning the subsidy pending the restoration of the refinery, emphasizing the need to address the current economic hardships faced by citizens.

Moreover, the suspension of the protest raised concerns about the potential human cost. Twitter users questioned the fate of those who might suffer from job losses or lack of income to cope with the current economic hardships before the promised refinery restoration in December.

As Nigerians continue to share their thoughts and concerns on social media, it becomes evident that the suspension of the NLC protest has ignited a strong response among citizens. 

The government and labor leaders must now take these sentiments seriously and address the legitimate concerns raised by the people. 

Open dialogue, transparency, and genuine commitment are crucial to finding sustainable solutions that benefit the working people and the nation as a whole. Only through collective efforts can a better and economically buoyant Nigeria be achieved.