Telcos blame low investment for poor services
The persistent decline in telecom service quality has reignited calls for increased investment in the sector, as subscribers continue to experience issues with weak signal strength and poor network performance.
MTN, Glo, Airtel, and 9mobile, which are the major telecom operators in the country, have been struggling to address frequent call drops, slow data speeds, and unreliable network coverage.
The deterioration in service quality was notable on August 1, during the “EndBadGovernance” protest, with many users finding basic online activities increasingly difficult due to slow and inconsistent data connectivity.
However, there has been a slight improvement compared to last week.
The Chairman of the Association of Licensed Telecommunications Companies of Nigeria, Gbenga Adebayor, warned on Monday that the ongoing decline in telecom service quality may signal further industry crises.
Speaking to The PUNCH, Adebayo highlighted the pressing need for increased investment to address the capacity challenges facing telecom operators.
“What we are seeing is the beginning of a bigger problem. I will not say telcos do have a shortage of capacity to contend with the issue. We have been saying that people are not investing.
“It has been a challenge even for infrastructure companies to maintain optimal services due to difficulties in attracting new investments,” the ALTON chair lamented.
He explained that many telecom systems were ageing and going out of scope, with operators struggling to renew their obligations to suppliers.
“It may be easier to blame the operators, but the reality is that investment is needed,” Adebayo added.
Over the weekend, The PUNCH gathered that the service decline was partly due to maintenance challenges during the heat of the protests, of which about 22 people died, according to Amnesty International.
Many telecom base stations, crucial for maintaining network operations, require regular upkeep and diesel to remain functional.
However, the protests, which began peacefully but eventually escalated, hindered site workers from reaching those base stations, which led to delays in maintenance and exacerbated the network issues.
The President of the National Association of Telecoms Subscribers, Adeolu Ogunbanjo, said, “The service quality has been so bad, and the signal strength so weak in the past few days, that it has affected both data services and regular calls.”
He told The PUNCH that despite previous engagements with telecom operators and the Nigerian Communications Commission to address those issues, little improvement had been seen.
He pointed out that MTN, one of the leading telecom operators, had extended its contract with IHS Towers, its infrastructure provider, as part of efforts to enhance service quality.
“At least the operator is taking steps to improve the quality of service,” he noted.
The deteriorating service coincides with the telcos’ scramble for investments, as they demand higher tariffs to offset high operating costs, fuelled by the significant depreciation of the naira.
In May, mobile operators in the country, including MTN Nigeria and Globacom, asked for Federal Government approval through the Nigerian Communications Commission to raise their tariffs.
In 2023, telcos faced a 70 per cent drop in investment, with total capital inflows falling from $456.8m to just $134m, according to the National Bureau of Statistics.
High taxes, inflation, and currency devaluation further exacerbated their difficulties, prompting calls for government intervention to improve the sector’s viability and attract investments.
The NATCOM president argued that the rising costs of maintaining and upgrading their infrastructure, much of which is dollar-denominated, necessitate higher charges.
Ogunbanjo expressed cautious support for a marginal increase in tariffs, provided that it leads to tangible improvements in service quality.
“A slight increase in tariffs to improve the quality of service would be acceptable, as long as it is a marginal increase that allows subscribers to enjoy better service,” he explained.
The telcos stated that their general service pricing framework had not been reviewed upward in the last 11 years, primarily due to regulatory constraints.
However, the possibility of a tariff increase depends on the NCC, which is conducting a cost-based study to determine if it would approve price increments for telcos.
The Chief Executive Officer of Financial Derivatives Company, Bismarck Rewane, emphasised the need for telecommunications companies to raise tariffs to enhance service quality and attract vital investments.
During an appearance on Arise TV in May, Rewane stressed that the sector urgently required new investments to upgrade infrastructure and improve services.
He warned that the current situation was hindering growth and development.
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