The adjustment, authorised by the Nigerian Communications Commission (NCC), comes after over a decade of unchanged pricing in the industry, despite high inflation impacting the costs of operations.

The statement from President Bola Ahmed Tinubu Media Centre revealed that the approval, however, does not mandate an immediate increase in tariffs. “It is equally important to highlight that this approval does not mean automatic increases in tariffs. Operators are still free to maintain their current rates if they find them sustainable.”

The Presidency also noted that the approved tariff hike is well below the over 100% increase originally requested by service providers, pointing to the government’s goal to balance the needs of the telecom sector with the economic realities faced by Nigerian households and businesses.

The statement highlighted the role the telecom industry plays in Nigeria’s economy, supporting millions of individuals and businesses that depend on uninterrupted connectivity for daily activities. 

“The telecom sector is a critical pillar of Nigeria’s economy, supporting millions of users and businesses that rely on uninterrupted connectivity for daily activities. Without a sustainable pricing model, the sector risks stagnation, with operators unable to maintain or upgrade infrastructure to meet increasing demands. By approving this modest adjustment, the NCC has ensured that operators can remain viable while creating room for innovation and improved service delivery.”

The Presidency pointed out that, without a sustainable pricing model, operators would face difficulties in maintaining and upgrading their infrastructure to meet growing demands. This, in turn, could lead to stagnation in the sector, sabotaging the quality of service.

It was also stressed that the NCC has introduced strict regulatory measures alongside the tariff adjustment, aimed at simplifying tariff structures and curbing exploitative billing practices. 

New sanctions for operators who fail to meet service obligations will ensure greater accountability and improved customer service. The Presidency reaffirmed that these changes aim to ensure that both operators and consumers benefit from a more transparent and fair telecommunications environment.

The adjustment comes after the NCC announced the approval on January 20, due to high costs of operations and the need for the sector’s sustainability. 

While the increase is seen as a necessary move to support telecom operators, the National Association of Telecommunications Subscribers (NATCOMS) has threatened to challenge the decision in court. 

The association argues that the tariff hike was approved without sufficient consultation with key stakeholders, particularly the subscribers who will ultimately bear the cost.

Nonetheless, the Presidency remains firm on its stand, presenting the 50% tariff adjustment as an initiative for the telecom industry to thrive, meeting the demands of digitalisation.

The recently introduced QoS Regulations 2024 outline specific standards for different network services, including 2G, 3G, and 4G, with a particular focus on areas such as Drop Call Rates, Call Setup Success Rates, and Traffic Congestion.

These regulations come with penalties for non-compliance. Telecom companies that fail to meet the prescribed standards will face a fine of N5 million for each violation, with an additional penalty of N500,000 per day until the issue is resolved. 

The NCC has mandated that operators submit monthly QoS reports, which will be reviewed alongside data collected through various means, including drive tests, consumer surveys, and data from the Commission’s Network Operating Centres (NOCs).

The new regulations are likely a response to the service quality goals recently set by Dr. Bosun Tijani, the minister of Communications, Innovation, and Digital Economy. 

Dr. Tijani’s Strategic Agenda 2023 includes several targets: achieving a 50% improvement in telecom service quality by the end of the year, boosting broadband penetration to 70% by 2025, ensuring download speeds of 25Mbps in urban areas and 10Mbps in rural areas by 2025, and extending coverage to at least 80% of the population, particularly in underserved and unserved regions, by 2026.

To meet these objectives, the NCC has shifted its strategy from a broad national approach to a more detailed, localised analysis of service quality. 

This involves gathering and scrutinising data at smaller, community levels to identify areas needing improvement, enabling the deployment of targeted solutions and regulatory actions. 

The Commission’s focus is not just on the technical aspects of service quality but also on enhancing the overall consumer experience.

These regulations point to a return to tougher enforcement by the NCC, which had previously been less active in imposing penalties despite widespread complaints about poor service quality. 

The last action by the Commission occurred in 2020, when Airtel was fined N2.3 billion for disconnecting a smaller operator without regulatory approval, a violation of QoS and enforcement process regulations. 

In 2019, the Commission imposed a total of N2.97 billion in fines on all four major GSM operators—MTN, Airtel, Glo, and 9mobile—for various infractions, including breaches of QoS standards. That same year, both Airtel and 9mobile were fined N5 million each for failing to comply with the Do-Not-Disturb rule, which protects consumers from unsolicited services.

These latest regulations by the NCC come at a challenging time for the telecom industry. Operators are struggling with the financial stress caused by the devaluation of the Naira and high inflation rates. 

In response to these economic issues, companies have been forced to cut back on operational expenses, including investments in network infrastructure, which has, in turn, affected service quality. 

Telecom operators have argued that to maintain and improve service standards, the regulator should consider allowing tariff increases.