Carl Cruz, the CEO of Airtel Nigeria, has brought to light the pressing issue that threatens the stability and efficiency of the telecoms infrastructure. This is the alarming rate of fibre optic cable cuts, with approximately 1,000 incidents reported monthly.

“Not many of you know, but the number of cuts that we have on our fibre optic cables, and I’m speaking for Airtel, on a monthly basis is over 1000,” Carl Cruz said at the Telecoms Industry 2.0: The Next Investment Frontier in Nigeria, organised by Financial Derivatives Company (FDC) in Lagos today.

Noting the gravity of the situation, Cruz pointed out that these fibre optic cable cuts go beyond disrupting services to also escalating operational costs, ultimately impacting the quality of service delivery across the country, limiting seamless and reliable connectivity to customers. 

“This challenge is not just a technical issue but a financial burden on the industry,” Cruz stated.

The fibre optic cables cut issue is compounded by Nigeria’s challenging economic environment, where inflation and currency devaluation have made it difficult for telecom companies to maintain stable operations. Cruz highlighted that these infrastructure challenges are pushing the industry towards an urgent point, where sustained investments are necessary to avoid further decline.

The Nigerian telecoms industry has steadily seen commendable success, driving connectivity and digital growth across the nation. However, as Cruz pointed out, the industry is now at a crossroads where the need for investment in infrastructure, particularly in securing and expanding fibre networks, is paramount.

“Without a secure and resilient infrastructure, the gains of the past two decades could be affected, and the possibility for future growth limited,” he cautioned.

The telecoms industry is at a point where it’s looking to explore new investment opportunities, particularly in 5G deployment and expanding broadband access to underserved areas. However, the tough issue of fibre optic cable cuts is a huge barrier to these advancements. 

“If we don’t invest in growing capacity in this industry, it’s not just the companies that will suffer—the entire country will be affected in the near future. Therefore, investment must continue, and ideally, at the pace we saw in previous years.” Cruz said.

With the increasing demand for data and the growing reliance on digital services, the pressure on telecom infrastructure has never been greater. Cruz called for a joint effort from both the private sector and government to address these challenges, noting that collaboration is key to ensuring the industry’s long-term viability.

The next phase of growth for the telecoms sector will hinge on how effectively these issues are addressed, projecting how Telecoms Industry 2.0 in Nigeria will come along.

Pointing to the severe sustainability challenges currently facing telecoms operators across the country, Toriola said this at the Telecoms Industry 2.0: The Next Investment Frontier in Nigeria, organised by Financial Derivatives Company (FDC) in Lagos today, with emphasis on: Two Decades After: What’s Next for the Telecoms Industry?

Despite the growth over the past two decades of liberalisation, the sector is now threatened by rising costs and unsustainable pricing.

Toriola noted his perspective about the viability of continued investment in the telecoms sector. He highlighted a fundamental issue which is the financial returns expected from the industry are now so low that they threaten its very survival.

“Nobody is going to put in $1 with the expected return of 60 cents on the dollar,” Toriola noted, pointing to the reality that without apt changes, the flow of new investment into the sector could dry up entirely.

One of the disturbing factors driving this crisis is the current pricing model, which has remained largely unchanged for over 11 years despite inflation and currency devaluation.

Toriola stressed that this static pricing is no longer tenable. “There’s no way under the surface of the earth, in the kind of inflationary environment and forex devaluation that we’ve seen, that an industry can maintain prices the same for 11 years,” he explained.

The telecoms sector has faced escalating costs across the board — from the cost of capital to the soaring expenses of maintaining infrastructure like base stations and diesel generators. Without adjustments to pricing, Toriola warned, the industry’s ability to function and attract investment is in jeopardy.

While acknowledging recent progress in discussions with regulatory authorities, Toriola made it clear that the situation remains critical. He indicated that stakeholders are beginning to understand the depth of the crisis and are considering necessary interventions, including price increases and concessions.

However, he also cautioned that time is of the essence. “Qualitative action needs to be swift and decisive to prevent the collapse of this industry,” Toriola urged.