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.

Phone calls will now cost N18.33 per minute, SMS rising to N6.67, and a 1GB data bundle now priced at N479.17. 

This increase will affect daily communication and data usage, especially for Nigerians already hit with inflation and high costs of living. 

Users could increase reliance on platforms like WhatsApp and others for calls and messages but what about those without smartphones?

Well, let’s break down the proposed tariffs and analyze their financial impact on consumers and businesses.

The Breakdown of New Tariffs

The proposed 60% tariff increase will apply across mobile services, with the following adjusted costs:

• Phone Calls: The cost of making phone calls will jump from N11 to N18.33 per minute, a rise of N7.33 (66.5% increase).
• SMS: The price for sending text messages will increase from N4 to N6.67, a jump of N2.67 (66.75% increase).
• 1GB Data Bundle: The cost for 1GB of mobile data will increase from N287.5 to N479.17, an increase of N191.67 (66.67% increase).

These increases already show a considerable burden on consumers, especially considering the price elasticity of demand for mobile services. With these hikes, consumers may need to adjust their usage patterns, reducing their reliance on mobile communication or exploring more affordable alternatives.

Mathematical Analysis of the Impact

To better understand the financial impact, let’s apply a few calculations to daily telecom expenses based on average usage:

• Phone Call Costs: If a user spends 30 minutes per day on calls:
• • • Current cost: 30 minutes × N11 = N330 per day
    • New cost: 30 minutes × N18.33 = N550 per day
    • Increase: N550 – N330 = N220 increase per day
    • Annual cost increase: N220 × 365 = N80,300 annually

• SMS Costs: If a user sends 10 SMS messages daily:

• • • Current cost: 10 messages × N4 = N40 per day
    • New cost: 10 messages × N6.67 = N66.70 per day
    • Increase: N66.70 – N40 = N26.70 increase per day
    • Annual cost increase: N26.70 × 365 = N9,745.50 annually

• Data Bundle Costs: If a user purchases one 1GB data bundle every 3 days:

• • Current cost: N287.5 × 122 = N35,075 annually
  • New cost: N479.17 × 122 = N58,472.74 annually
  • Increase: N58,472.74 – N35,075 = N23,397.74 increase annually

Cumulative Impact on the Consumer

Taking the average consumer who spends on calls, SMS, and data bundles:

• Total annual cost increase for calls, SMS, and data:

• • Calls: N80,300
  • SMS: N9,745.50
  • Data: N23,397.74
  • Total increase: N80,300 + N9,745.50 + N23,397.74 = N113,443.24 annually

For an average Nigerian, this could wildly stretch their monthly budget. With over 200 million mobile subscribers in Nigeria, this surge in prices could splash through the economy, affecting consumer spending, business operations, and digital accessibility for underserved communities.

How will this Affect the Economy?

This telecom tariff increase will likely hit low-income individuals and small businesses hardest, as they rely on affordable communication to maintain both personal and professional interactions. The costs could lead to:

• Reduced Digital Access: With higher data costs, individuals may limit their online presence, curtailing opportunities for education, remote work, and e-commerce, thereby deepening the digital divide.
• Business Strain: Small businesses, particularly those relying on mobile phones for customer interactions and mobile banking services, may face increased operational costs, prospectively slowing down economic growth.
• Increased Costs of Living: Since mobile communication is a key aspect of daily life in Nigeria, higher telecom charges could contribute to an overall rise in the cost of living, making it harder for Nigerians to cope with inflation.

Conclusion and Recommendations

The proposed telecom tariff increase of 60% will undoubtedly add really high financial stress on consumers. While the government and telecom operators argue that the increase is necessary to sustain the industry due to high costs of operations, the burden on Nigerians could have far-reaching effects.

To mitigate the impact, the government could consider implementing subsidies for low-income users, promoting digital literacy, and investing in infrastructure that reduces the cost of telecom services. 

Ultimately, it all boils down to the country’s economy and a balance from the government.