The commitment was highlighted following a high-level engagement between the leadership of both organizations, focused on addressing the infrastructure deficit, regulatory hurdles, and investment opportunities within the Nigerian telecommunications sector.

The meeting, which featured key executives from ATCON and senior officials from the NCC, served as a platform to discuss the evolving landscape of the industry.

“The discussions centered on creating a more enabling environment for telecommunications operators, ranging from Tier-1 mobile network operators to smaller Internet Service Providers (ISPs)”, a source who was at the meeting told Techeconomy.

​This was also collaborated by a statement released via ATCON’s official LinkedIn page, confirming that the partnership aims to bridge the communication gap between the regulator and the regulated, ensuring that policies are both forward-thinking and practical for industry players.

​The renewed partnership is expected to focus on several critical areas such infrastructure protection by addressing the frequent challenges of vandalism and the “Right of Way” (RoW) issues that hinder the expansion of fiber optic networks.

“​Quality of Service (QoS) is another key issue discussed. The partners agreed on working together to establish benchmarks that improve the user experience for millions of Nigerian subscribers.

The ATCON delegation led by the president, Tony Emoekpere, also emphasized on NCC ensuring its guidelines reflect the operational realities of ATCON members to encourage sustainable business growth.

ATCON, acting as the umbrella body for the industry, expressed optimism that the NCC’s current leadership is attentive to the concerns of investors.

By fostering an atmosphere of transparency and inclusivity, the association believes Nigeria can more effectively attract the Foreign Direct Investment (FDI) required to achieve the targets set out in the National Broadband Plan.

Dr. Aminu Maida, the EVC of NCC, on his part, reiterated the Commission’s role as a fair arbiter, emphasizing that its goal is to protect consumer interests while ensuring that the telecommunications sector remains a robust contributor to Nigeria’s Gross Domestic Product (GDP).

​This engagement marks a significant step in reducing friction within the sector. Industry analysts suggest that a synchronized relationship between ATCON and the NCC is vital for the successful rollout of 5G services and the expansion of digital inclusion to Nigeria’s underserved rural areas.​

As the industry faces macroeconomic pressures, this unified stance provides a sense of stability for stakeholders and sets the stage for a more resilient digital future for the country.

Held at Radisson Blu Hotel, Ikeja GRA, on Wednesday, October 22, the event convened leading voices from government, telecommunications, power, and technology sectors to discuss solutions for expanding digital access to unserved and underserved communities across Nigeria.

The Summit, themed “Bridging Nigeria’s Digital Divide: Accelerating Rural Connectivity Through Collaboration,” was organised by Business Metrics in partnership with stakeholders across the industry.

Delivering the keynote address, Dr Aminu Maida, executive vice chairman of the Nigerian Communications Commission (NCC), noted that the real measure of connectivity lies in its economic impact rather than technical metrics.

“The accurate measure of connectivity is not in megabits per second, but in economic value it creates or loses,” Maida said.

He noted that despite progress since 2001, millions of Nigerians are still digitally invisible, unable to access reliable broadband, mobile, or data services that now define inclusion in the modern economy.

In his address, Engr Gbenga Adebayo, chairman of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), drew attention to the underlying infrastructure gaps that hinder connectivity.

“80 million Nigerians do not have access to reliable electricity,” he stated, warning that without addressing energy poverty, telecom expansion will continue to face obstacles.

Adebayo further stressed that connectivity must be pursued as a people-centred mission.

“48 million Nigerians do not have access to toilets,” he said. “When we talk about inclusion, it’s not just digital; it’s about dignity.”

The President of the Association of Telecommunications Companies of Nigeria (ATCON), Tony Emoekpere, called for urgent transition from dialogue to execution.

“We need to move away from talk shops into actions,” he stated. “This Summit should not end with resolutions; it must produce measurable results.”

Speakers from across the ecosystem, including the Rural Electrification Agency (REA), highlighted ongoing collaborations with NCC to power rural telecom sites using renewable energy mini-grids. 

This partnership aims to reduce costs and improve sustainability by pairing electricity access with digital connectivity.

Dr Tola Yusuf, chief executive officer of Infratel Africa, linked infrastructure to development outcomes.

“The backbone of rural prosperity is digital connectivity, but the backbone of connectivity is the right incentive structure,” he said, calling for fiscal incentives, public-private partnerships, and community-led models.

Dr Olusola Teniola, former ATCON President and executive director at ipNX, reiterated the urgency of implementation.

“It does remain a talk shop, and I’m tired of talk shops nowadays. We need action,” he said.

The Summit’s panel sessions explored multiple dimensions of the challenge and produced several key insights:

The first panel, focused on Mainstreaming Edge Infrastructure for Accelerated Inclusion.

Moderated by Chidi Ajuzie, group COO, Western Telecoms & Engineering (WTES) Limited, panellists included Dr. Ayotunde Coker, CEO, Open Access Data Centre (OADC); Wole Abu, MD, Equinix West Africa (MainOne); Dr. Krish Ranganath, regional executive (West Africa), Africa Data Centres and Goke Juba, associate director, Fibre Operations, IHS Nigeria.

Key insights included:

• Expansion of edge data infrastructure beyond Lagos and Abuja is essential to reduce latency and improve local content delivery.
• Power, security, and connectivity must be addressed together to ensure site viability.
• Collaboration between operators and data-centre providers will drive faster deployment in rural areas.

The second session,  focused on Infrastructure Sharing & Collaboration as Key Pillars of Bridging Digital Divide, was moderated by Louisa Olaniyi, the compere. 

The panellists included Tony Emoekpere, president, Association of Telecommunications Companies of Nigeria (ATCON); Dr Tola Yusuf, co-founder, Infratel Africa; Segun Okuneye, Divisional CEO, ipNX Nigeria Limited; Onemeguke Azubuike Lucky, senior analyst, Natcom Development and Investment Limited (ntel); Olumide Idowu, group chief technology & information officer, Alphabeta LLC; John Nwachukwu, chief strategy & executive officer, Zoracom; and Dr Isa Usman, associate director, Network Operations, GICL.

Key insights included:

• Shared infrastructure remains the most cost-effective path to rural expansion.
• Spectrum access, harmonised right-of-way policies, and targeted subsidies are needed to attract investors.
• Result-based financing and community-owned networks can complement traditional operator models.

Omobayo Azeez, convener and lead of the Rural Connectivity Initiative, emphasised the need for continued movement.

“Let this gathering be remembered as the moment we all come together to move from talk to action, from plans to progress, and from intent to real impact,” he said.

The Rural Connectivity Summit will become an annual platform for dialogue, accountability, and innovation, bringing together regulators, operators, development agencies, and community leaders to drive universal connectivity and digital inclusion across Nigeria.

The event, themed “Impact of Adjacent Agencies on Nigerian Telecom Sector: The Way Forward,” was an in-depth conversation about the structural and regulatory issues stalling industry growth.

The President of ATCON, Tony Emoekpere, opened the meeting with a reflection on the journey so far. “Two years ago, I was entrusted with the mandate to lead this association, and I’ve done so to the best of my ability with absolute focus,” he said. 

He noted that the association has grown with at least 27 new member companies joining during his tenure, and that ATCON had engaged with over 75 strategic global and local events to defend industry interests.

However, he stressed the pressing concerns about the growing influence of non-core regulatory bodies in telecom operations. 

Emoekpere led a no-holds-barred discussion, pointing out that several agencies outside the industry were imposing levies and regulations, thereby disrupting operations.

“We have other agencies that are trying to create some form of levies, looking for ways to impose charges right away on their operations,” he said. “We don’t want to be in an environment where our investment is totally at risk, or where people don’t even want to invest in our sector.”

Participants described the actions of these adjacent agencies as intrusive and economically damaging. Multiple operators spoke about what they termed regulatory duplicity, instances where different state agencies imposed overlapping charges and policies. 

A stakeholder stated: “We already face enough ends. We don’t want to have other people taking up the responsibility.”

The need for a one-stop-shop regulatory model was a recurring recommendation. “In some states, you have the State Revenue Service, the State Infrastructure Agency, the Urban Planning Agency – all coming after you for the same reason. It is not sustainable,” another stakeholder said.

The discussion turned inward when Engineer Ikechukwu Nnamani, CEO, Digital Realty (Nigeria) and former president of ATCON, noted industry indiscipline and undercutting among telecom players.

He pointed out that while some members advocate for tariff increases, others reject it, leaving the entire sector weakened. “We’re in the same industry, and they are better capitalised than us… we’re hurting ourselves,” he stated.

This disunity was seen in competition for bank contracts. “The same bank writes you and says decrease your service price, even after telling you that your cost of capital has gone up,” he added. “We don’t function as an association. We don’t function as a group. So when they harass us, we go back and start competing amongst ourselves.”

Vice President of ATCON and CEO of the Internet Exchange Point of Nigeria (IXPN), Muhammed Rudman, stated: “99.98% of internet users in Nigeria access it via mobile, while only 0.2% use fixed lines,” a sharp contrast to South Africa where over 50% of users are on fixed lines, enabling better in-country data traffic retention. 

“Brazil is now the second largest country with internet networks because they domesticated 90% of their traffic through strong associations.”

As tensions rose, Emoekpere reaffirmed ATCON’s focus on industry-wide cohesion. He revealed plans to set up an Industry Think Tank Committee to establish standardised guidelines for engagement with adjacent agencies.

“We must start having industry committees, think tanks to handle some of these matters, so we can now come up with a position,” he said.

Calls for a renewed code of conduct were made, and several members volunteered for roles in committees aimed at solving these regulatory and operational issues. “We must move from talk to structure,” he asserted.

The meeting also touched on education and workforce development, with members agreeing that ATCON must play a more active role in impacting the academic curriculum to meet telecom industry demands.

The group resolved to explore partnerships, virtual training models, and institutional support for under-resourced tertiary institutions.

Closing the session, Emoekpere said, “ATCON is not just an association, it is a collective commitment to action. We do make an impact, and they are actually looking forward to our contributions.”

The newly elected executives were sworn in with high expectations. The first task on their table: push back against regulatory encroachment and unify a fractured industry.

The core reason is that Nigeria’s telecom sector, while heavily reliant on imported infrastructure, is not an exporter of goods but rather, an importer of equipment from countries like China, the U.S., and parts of Europe.

Tony Emoekpere, president of the Association of Telecommunication Companies of Nigeria (ATCON), said, “It won’t affect the industry much because the operators import everything they use directly. They don’t export.” 

There is actually more at play than just the tariff’s direct impact. Emoekpere pointed out that the sector’s vulnerability lies in the national economic dynamics, specifically those affecting foreign exchange and inflation.

The recent 50% increase in telecom service tariffs, a decision made to counteract the high costs of operations, directly connects to the overall economic climate. 

Inflation, alongside a weakened naira, has placed huge pressure on telecom operators, pushing them to make difficult pricing adjustments. 

This price hike aims to stabilise operations while promoting investments in infrastructure—something that could be compromised if the U.S. tariff negatively impacts the country’s larger economic space. 

Gbenga Adebayo, president of the Association of Licensed Telecommunication Operators of Nigeria (ALTON), stresses a particular issue: “There is no hardware that we export, but there might be issues with charging international calls by local operators. If the VAT on calls in the US increases, local operators will need to adjust to the rates.”

Even with the tariff not directly targeting the telecom sector, Nigeria’s non-oil exports, which include agricultural products and industrial raw materials, are now facing a more challenging global market. 

This, in turn, could shrink foreign exchange earnings, further depreciating the naira and fuelling inflation. The result could be a tougher environment for telecom operators who depend on the importation of equipment priced in foreign currencies.

The U.S. tariff’s impact on Nigeria’s exports could cost the country as much as $814.8 million annually, according to estimates. While Nigeria’s foreign exchange reserves have recently climbed to $23.11 billion, the highest in three years, these reserves remain vulnerable to external shocks. 

With telecom operators fighting with rising import costs, this buffer might not be enough to shield them from the compounded effects of inflation, energy costs, and currency depreciation.

Adding to the issue, many Nigerians are venting discontent over the 50% tariff hike. Labour unions, including the Nigeria Labour Congress (NLC), have threatened industrial action, accusing telecom operators of taking advantage of the economic crisis. 

The public’s annoyance comes not just from the high costs but also from ongoing issues with poor network quality despite operators’ claims of improved service.

The government’s response to these external pressures is important. Though the U.S. tariff appears to have little direct impact on the telecom sector, the cascading effects on foreign exchange and inflation may present a different story. 

There’s a sense of cautious positiveness within the industry, with some hoping the government will negotiate with the U.S. to ease the stress on Nigerian exporters and, by extension, telecom operators. This could involve forging new trade agreements or diversifying markets for Nigerian goods.

However, even as the industry walks through these external trade dynamics, the challenges within Nigeria’s telecom sector are a lot. Poor service delivery, limited infrastructure development, and an increasingly price-sensitive market all contribute to the difficulties operators face in balancing profitability with customer satisfaction. 

Gbenga Adebayo says, “If the VAT on calls in the US increases, local operators will need to adjust to the rates”—reiterating the challenges in global trade dynamics that could ultimately affect Nigerians on the ground.

In this environment, telecom operators will need to tread carefully, managing their costs while striving to meet customer expectations. With consumers already on edge due to the tariff hike, any further economic turbulence could push the sector closer to a tipping point.

They argued that before CNII can have a real impact, internal operational issues, standardisation challenges, and industry-wide inefficiencies must first be addressed by telecom operators.

Gbenga Adebayo, chairman of the Association of Licensed Telecommunications Operators of Nigeria (ALTON), noted the broad challenges such as infrastructure vandalism, unauthorised installations, and cable theft.

He pointed to poor maintenance as a key factor enabling theft and vandalism. “When properly installed, these components are difficult to remove. However, due to negligence, they are often left unsecured, making them easy targets for theft,” he said.

Beyond vandalism, Adebayo noted that community resistance to telecom projects has slowed progress. He recalled an incident where “A diesel supplier was blocked from entering an estate because a previous contractor had damaged their property and failed to make repairs. This lack of accountability breeds distrust and delays crucial projects.”

To prevent such conflicts, he urged stakeholders to promote better relationships with local communities.

Adebayo also identified the unauthorised installation of telecom infrastructure without government approval as a major issue. He explained, “Government agencies often damage unregistered infrastructure simply because they were not documented in official records. Proper approvals and collaboration with authorities will ensure accountability and protection of critical infrastructure.”

He called for improved coordination within the industry, stressing that operators must resolve internal challenges before relying on external protections promised by CNII provisions.

Tony Emoekpere, president of the Association of Telecommunications Companies of Nigeria (ATCON), emphasised that Nigeria’s infrastructure challenges go beyond technical issues, extending into environmental and moral concerns.

“We are dealing with a moral challenge. An engineer who switched from diesel to gas generators encountered a new problem—workers began stealing engine oil instead, as they could no longer siphon diesel. These issues require both technical and ethical solutions,” he said.

He stressed that the lack of proper standardisation weakens infrastructure sustainability. “If infrastructure is deployed in a suboptimal manner, failure is inevitable. We need to establish proper standards that all stakeholders—government, private sector, and the public—can align with,” he stated.

Emoekpere also noted that while Nigeria has strong policies, such as local content policies, implementation remains a major challenge. “We must move beyond discussions and focus on actionable steps, follow-ups, and policy enforcement,” he added.

Wale Owoeye, CEO of Cedarview Communications Limited, spoke about the frequent cable theft, which disrupts network operations and increases maintenance costs.

“Cable theft is a serious issue. Airtel representatives told me they experience a cable cut every six minutes. The assumption that all black cables contain valuable copper leads to reckless vandalism,” he explained.

To tackle this, Owoeye proposed three key approaches:

1. Community Reorientation – “We need to engage local communities in their native languages, educating them on the consequences of vandalism.”
2. Stricter Enforcement – “Strict legal penalties, including long-term imprisonment, should be enforced to deter offenders.”
3. Proactive Prevention – “Prevention is always more effective and cost-efficient than restoration.”

As a necessary measure, he suggested creating a dedicated fund to support advocacy and awareness campaigns across Nigeria.

In this regard, he pledged to contribute ₦500,000 quarterly as a seed fund and encouraged other industry players to follow suit. “This is like planting a seed. With collective effort, we can grow it into a sustainable solution for protecting Nigeria’s telecom infrastructure,” he said.

The speakers collectively emphasised that addressing these challenges requires collaboration among industry players, government agencies, and local communities.

They called for a concerted effort to enforce policies, engage stakeholders, and implement practical solutions that will ensure the long-term sustainability of Nigeria’s telecommunications infrastructure.

The move, which has led to objections from various quarters, was authorised by the Nigerian Communications Commission (NCC) to address expensive costs of operations in the sector.

Deolu Ogunbanjo, president of NATCOMS, said the decision was made without adequate consultation with stakeholders. He described it as an unfair burden on Nigerians already facing economic difficulties. Speaking in Lagos, Ogunbanjo said, “This will affect everyone from the biggest industry to the smallest company, such as the Point of Service (POS) operators. It will increase operational costs.”

While acknowledging the challenges faced by telecom operators, Ogunbanjo suggested a more moderate increase of 5% to 10% would have been sufficient. He also proposed alternative strategies for raising funds, such as Initial Public Offerings (IPOs), to reduce the financial burden on subscribers. 

“Operators can allow Nigerians to invest in their companies through IPOs rather than imposing such a steep tariff increase. A 50% hike is unacceptable,” he added.

NCC Defends Decision

In its defence, the NCC argued that the tariff adjustment was necessary to sustain the industry. According to a statement by its Director of Public Affairs, Dr Reuben Muoka, the commission approved the increase after extensive consultations with stakeholders. 

It noted that some operators had requested a 100% hike but the NCC capped the adjustment at 50% to strike a balance between industry sustainability and consumer protection.

“These adjustments will support the ability of operators to continue investing in infrastructure and innovation, ultimately benefiting consumers through improved services and connectivity,” the NCC stated. 

The commission also emphasised the need for transparency, mandating operators to educate the public on the new rates and ensure measurable service improvements.

Mixed Reactions to the Increase

Subscriber groups and consumer advocates have condemned the hike. The Association of Cable TVs, Internet and Telecom Subscribers of Nigeria (ATCIS-Nigeria) described the increase as punitive and ill-timed, given the rising cost of living. 

ATCIS President Sina Bilesanmi accused the government of prioritising corporate interests over consumer welfare, saying, “This increase will further strain the finances of struggling Nigerians.”

Ogunbanjo reiterated a similar warning, stating that the hike could force many small businesses to shut down. He reaffirmed NATCOMS’ plan to file a fresh lawsuit to challenge the decision, describing it as a “provocative and disproportionate” measure.

On the other hand, industry stakeholders have defended the need for higher tariffs. The Association of Telecom Companies of Nigeria (ATCON) argued that the adjustment was overdue, given the high costs of operations and the long gap since the last tariff review.

ATCON President Tony Emoekpere noted that while the 100% hike requested by telecom operators might seem excessive, the 50% approval reflects current economic realities. “The delay in addressing tariff rates over the years made this adjustment inevitable,” he explained.

The tariff increase is expected to impact data, calls, and SMS charges, raising issues about affordability for many Nigerians.

While the NCC has assured that the adjustments will support better network quality and broader coverage, consumers are calling for greater transparency and fairness in implementing the new rates.

Confirming the development in a statement available to Techeconomy, Mr. Tony Izuagbe Emoekpere, the president, ATCON, said;

“We are pleased to inform the general public that our Association has been inducted as a pioneer member of the Federation of African Digital Businesses (FADB).  The inauguration took place on May 30th, 2024, in Marrakech, Morocco.

“The membership of the Federation is currently comprised of Nigeria, Morocco, Djibouti, Cameroon, Rwandan and Congo Brazzaville”.

Mr. Emoekpere  said the remaining African countries are expected to join before the end of this year.

“It has been collectively decided by the member countries to establish the headquarters of the federation in Casablanca, and it shall be funded by the Kingdom of Morocco for the first five years.

“The objectives of the federation are to encourage the membership of all African businesses operating in the digital sector, with the aim of strengthening economic integration and regional cooperation in this field.

“We are committed to working together to create a business-friendly environment in the digital sector in Africa, fostering innovation, growth, competitiveness, and wealth creation for African businesses in this strategic sector, as well as job creation.

He said that ATCON has informed all the relevant agencies under the Ministry of Communications, Innovation, and Digital Economy, regarding the establishment of the Federation.

Causes of these fiber cuts, according to industry players, are primarily related to government and private sector construction activities, accounting for almost 80% of terrestrial cable cuts.

Fishing trawlers, dredgers, oil companies, and vessel activities have also been identified as contributing significantly to disruptions in subsea cables.

Thus, the Association of Telecommunication Companies of Nigeria (ATCON) further highlighted fibre cuts as major stumbling blocks to the Nigerian telecom sector’s growth, and recommended ‘Dig Once Policy’ as solution to this challenge.

Similarly, the association affirmed its readiness to rally its members take strategic measures to tackle submarine fibre disruption in the country.

Tony Emoekpere, the president of ATCON, at the first edition of ATCON’s Critical Conversation Breakfast Meeting held in Lagos with the theme: ‘the Direct And Indirect Cause And Impact Of Metro, Terrestrial And Submarine Fibre Disruptions (Cuts)–Short, Medium And Long Term Sustainable Solutions’, stated that, operators cannot continue to pay lip service to issues and challenges that have constituted stumbling block to the telecom sector growth.

Fibre Cuts and Associated Financial Losses

The president recall that few months ago, there was a reported case of subsea cable cuts which significantly impacted Nigeria and some African countries, adding that,

“The incidences of Metro, Terrestrial and Submarine Fibre Disruptions have become a recurring decimal which must be addressed by relevant agencies at all levels of government. Our members have had to pay a substantial amount of money to have all these disruptions fixed and this is impacting on their operational expenses which should not be if the perpetrators are brought to book.”

On advocacy, the president said ATCON is seeking ways going forward, adding that ducts should be built when new roads are being constructed.

“There is a need to enforce and implement the provision in the Nigeria National Broadband Band Plan 2020-2025 which states that NCC should have a desk officer in each state of the Federation who is expected to be in charge of the fiber network in order to minimize Fiber cuts during roads construction,” he recommended.

The president averred that the telecom sector has been reported to contribute over 14 per cent to the nation’s GDP, adding that, the sector could have done much better if issues like fiber disruption which has constituted a threat to the manifestation of its inherent potentials, is dealt with.

Critical National Infrastructure Protection

Emoekpere however stressed the need for more collaboration between telecoms operators and government, with developers and road contractors to mitigate the challenges of fiber cuts.

“There must be compensation for fibre cable cuts. Training and awareness creation on the importance of fibre cable and the danger and negative impact of fibre cable cut, cannot be overemphasised. The federal government should declare telecoms assets as Critical National Infrastructure (CNI).

“Government should come up with policies like ‘Dig Once Policy’ for the implementation of fibre laying to avoid operators damaging cables of other operators during cable laying. There must be a clear database of government agencies giving approvals for road construction to enable telecom companies to have an idea of who they are dealing with as well as the need to have a status update on task responsibilities of ATCON for a follow-up of ATCON activities,” he advocated.

In the same vein, the CEO of NetAccess, Lekan Balogun said, the major causes of fibre cable cut includes Govt/Private Contractors, man-made, planning and Design and Natural causes, while stressing that, there is need for constant engagement between ATCON members, the government and developers.

Balogun proposed short, medium and long term recommendations to forestall fibre cuts, adding that the use of protective materials like metals rather than plastics will help protect the cables from unwanted cuts.

ATCON members at the breakfast series widely agreed that the government has a crucial role to play in protecting telecoms infrastructure through the passage of the Critical National Infrastructure bill, promoting inter-agency cooperation, increasing awareness, and aligning certification for fiber optic service providers.

Although the National Broadband Plan was praised as a good policy, stakeholders suggested closer monitoring of its implementation to ensure its success.

Some photos at the event:

During a panel session moderated by Mr. Wole Abu, the chief executive officer at Liquid Intelligent Technologies, industry experts unanimously agreed that the Lagos- Calabar coastal highway project is also a major risk to the integrity of the submarine cables as all landing stations are on the seashore of the Lagos end where construction has started from.

“Nigeria, and Africa as a whole, could experience another internet outage if these cables are damaged during construction. This would have a severe impact on the economy, particularly on financial services and other sectors relying on digital infrastructure. Therefore, it is imperative for the government to engage continuously with ATCON to mitigate the risks associated with this construction activity”, Abu said.

They agreed that there is ample room for collaboration between telecom companies internally and with government agencies such as NIMASA, NIWA, FMWH and the Navy to monitor and provide support for submarine cable systems.

“It is crucial that a concerted effort is made today to secure our digital future”.

Meanwhile, the telecommunications industry has come a long way, contributing more than 14% of Nigeria’s GDP and poised for hypergrowth with the emerging technology trends.

Despite ongoing demolitions of properties and recreational centres in Lagos to expedite the construction of the highway, telecom operators have stated they had not been consulted on potential risks or mitigation measures.

The lack of dialogue with the government has prompted telcos to caution Hitech Construction, the firm handling the project, to exercise vigilance to prevent damage to critical national infrastructure along the coastal lines.

Punch report quoted the Gbenga Adebayo, the chairman of the Association of Licensed Telecom Operators of Nigeria, saying,

“There hasn’t been any damage done or any incident, and we haven’t been consulted as well. I think the message is clear: caution has to be taken while working in that quadrant. So, so far, no notice and no consultation.”

The coastal corridor of the Lagos-Calabar highway plays a pivotal role as a landing site for several submarine cables linking Nigeria to Europe.

These cables, such as the West Africa Cable System, MainOne, Glo1, ACE, and NCSCS, are essential for facilitating international communications and data transmission within the country.

Also commenting, Tony Emoekpere, the president of the Association of Telecommunications Companies of Nigeria said that while there was no official invitation, there was a publication indicating the government’s invitation for stakeholder consultations.

However, he stressed the importance of proactive engagement to address potential risks and ensure the protection of vital infrastructure.

“I got the information that the coastal highway may not really impact or disrupt some areas. However, I have seen a publication indicating that the Federal Government invited stakeholders for consultation,” he said.

He allayed fears that some areas along the coastal corridors may not be impacted by the highway construction.

[Source]

The country’s broadband penetration as at November 2023 was 41.87%, according to the Nigerian Communications Commission (NCC).

Between the global financial market and local ventures in Nigeria, there is a huge connection influencing various sectors, including internet broadband expansion, mostly impacting startups in the telecommunication industry.

Uche Paragon, a Financial Market expert, popularly known as the wealthiest trader in Nigeria, emphasized this fact, noting that the sector has had a more positive than negative impact in the telecoms sector in years.

“The awareness we’re having in Nigeria now, and the kind of volume that Nigerian investors are leveraging on in terms of fintech trends and services, it’s because of a broad expansion of technology. In fact, 90% of retail clients in Nigeria use mobile phones to access the market.”

He emphasized that younger people are taking a more active role in the financial market than those who prefer traditional methods of business in Nigeria. As a result, the fintech industry is now dominated by the youth.

This may be why most millennials in business who use fintech are under the age of 42. The widespread availability of the internet, despite challenges, has brought about massive adoption and growth in the sector.

Despite these positive impacts, industry analysts are increasingly concerned that the current forex challenges could greatly affect the rollout of essential infrastructure and suffocate the growth of the vital telecoms sector, ultimately derailing the nation’s broadband aspirations.

Tony Emoekpere, president of the Association of Telecommunications Companies of Nigeria (ATCON), noted that the forex crisis has taken a toll on all operators, with smaller players bearing the brunt.

Making this fact more pronounced, Airtel’s recent financial report revealed a 1.4% revenue decline from $3.91 billion to $3.86 billion in the same period of 2023.

Meanwhile, 9Mobile, the fourth largest operator, experienced a drought in data subscription revenue, with figures plummeting to 3.81 million as of September 2023, marking a 127% decline from its peak of 17.1 million subscribers recorded in April 2016.

In November 2023, broadband penetration was 41.87%, marking a 14.2% decline from its peak of 48.28% in March 2023. Falling short of the 50% penetration target for 2023, the industry now faces a 28% gap in achieving the 70% target set for 2025.

Why the increasing difficulty? Limited access to US$ dollars, a direct consequence of the Central Bank of Nigeria’s (CBN) floating the naira creates a big barrier for telecom operators desperate to import essential equipment and services like base stations, fiber optic cables, and satellite technologies which are essential for expanding broadband coverage.

This scarcity drives costs sharply upwards, forcing operators to seek dollars on the parallel market at significantly higher rates.

Again, the prevailing forex uncertainties have cast a pall of cautiousness over the investment sector. With the path to dollar access being hindered and the potential for further currency devaluation being imminent, telecom operators are hesitant to commit large-scale investments. This creates a vicious cycle, where the lack of investment hinders progress, which in turn strengthens the case for further restrictions, perpetuating the problem.

The potential consequences of missing the 70% broadband target are far-reaching and paint a concerning picture.

Broadband penetration is widely recognized as a linchpin for economic growth. If Nigeria falls short of its target, it risks stunting its digital transformation efforts and limiting its economic potential. This would have a ripple effect across various sectors, impacting everything from job creation to financial inclusion.

The social impact of missing the target is equally worrisome. Limited broadband access would exacerbate the existing digital divide, leaving large segments of the population excluded from essential online services like education, healthcare, and financial inclusion. This would widen the gap between the digitally empowered and the marginalized, potentially exacerbating social inequalities.

On the global stage, falling behind in broadband penetration could erode Nigeria’s competitiveness, causing a hindrance to the country’s participation in the global digital economy. In an increasingly interconnected world, this could have significant ramifications for Nigeria’s standing and influence.

But Uche Paragon says investors are not giving up. Speaking on VC’s decisions to invest in Nigeria startups, he said: “The widespread use of mobile phones (90% of retail clients) has fueled the development of apps, facilitating inclusion even in remote areas, bridging the gap and connecting previously excluded populations.

Venture capitalists are increasingly recognizing the potential of startups in the financial market, and providing needed funding for innovation and growth, fueling the engine of progress despite challenges.”

Paragon didn’t fail to point out an important factor that influences VC’s decisions. “There’s no regulation, no proper legal structure equals the venture capitalists.”

The impact of regulation on startup businesses, particularly in the telecom sector, has been mixed.

“Regulations are not restrictive measures; they are intended to ensure that businesses operate ethically and profitably. Adhering to regulatory frameworks may initially delay processes but ultimately facilitates credibility and attracts positive policies conducive to business success,”

Paragon explained.

“Conversely, the absence of proper regulation and legal structure can deter venture capitalists and hinder business growth. Despite these drawbacks, startups that scale through regulatory complexities effectively often thrive in the market.

While acknowledging the challenges, it is important to recognize the opportunities inherent in regulatory compliance, which can ensure innovation and sustained success in the telecom sector.”

Fortunately, there are potential solutions on the horizon. Addressing the FX challenges through market reforms is important.

The CBN needs to implement measures that improve transparency, flexibility, and access to dollars for the telecoms sector.

This could involve creating a dedicated forex window for critical imports or relaxing restrictions on accessing foreign exchange.

Paragon said that globalization can abolish border controls and create rules for borderless businesses. “Some investors don’t necessarily have to be in your country to do business with you, they can be elsewhere and do business in your own country.”

However, he noted that policies can affect investors from coming in, but it depends on the structure of the sector.

Exploring alternative funding sources is another avenue worth pursuing. Local currency financing or partnerships with international development agencies could help mitigate the impact of FX constraints and keep projects moving forward.

Additionally, the government can provide policy and regulatory support to incentivize investment in broadband infrastructure. Tax breaks, subsidies, or streamlined licensing procedures could make investing in broadband a more attractive proposition for operators.

Paragon concluded by saying that “Nigeria is at the edge of passing through the process of digital disruption and the process has begun, which is why you see an economic crisis. It is a very positive impact because of the concept of digitalization of economies and globalization of economy.”

Nigeria’s ambition to achieve a 70% broadband penetration by 2025 is imperiled by the challenges within its foreign exchange (forex) market, linked to the global financial industry.

As emphasized by Uche Paragon, the youth-driven fintech industry has seen impressive growth, bolstered by increased internet accessibility and mobile phone usage.

Nonetheless, the current forex crisis poses a huge threat to the telecom sector, manifesting in declining revenues and faltering broadband penetration rates.

The ramifications of missing the broadband target extend beyond economic concerns, encompassing social disparities and global competitiveness.

While regulatory challenges and FX constraints bring about tough obstacles, opportunities for reform and alternative financing avenues are a positive light.

On the other hand, should telecommunication companies (i.e. the MNOs) squeeze out funds from investors to deploy infrastructure and the subscribers’ purchasing power keep deteriorating, such will impact negatively on the ROI.

In turn, the MNOs might abandon some (expansion) projects. We understand there are provisions like the USP-funds, but subscribers are still meant to pay for the services to recoup the taxes for the government and the investors’ funds!

Through strategic market reforms, improved transparency, and targeted policy interventions, Nigeria can scale through the forex challenges, ultimately facilitating broadband expansion.

Embracing the digital disruption underway, Nigeria can achieve sustainable growth and enhanced connectivity, provided stakeholders collaborate effectively to address the multifaceted issues at hand.