ICT
Telcos may lose N40bn revenue as customer base shrinks
Investigation by National Daily has revealed that the telecom operators in the country may lose at least N40 billion cumulative revenue for voice and data segments of their services this year as the ban on open SIM registration, 9mobile debt crisis and other factors continue to reduce their customer base.
Active telecom lines in the country presently stand at about 144 million, according to NCC
National Daily gathered that last year, telecom customers reduced from 155m in January to 144m in December, records from the National Bureau of Statistics and the Nigerian Communications Commission (NCC) showed.
This is about 11m reduction in their customers’ number. This means that the telcos lost about N25bn voice revenue, based on monthly average revenue per user of $4 (N 1,220) which is the current industry benchmark.
But this year, projections by operators and experts show that the four big telecoms operators and other smaller ones may further lose as much as between 15m and 20m of their customers.
National Daily investigation showed that ban on open SIM registration, the uncertainty over the fate of 9Mobile and inability of the operators to expand their networks to many unserved places within the country are jointly responsible for continued reduction in number of phone users.
The NCC in 2017 banned indiscriminate registration of SIM cards by the SIM vendors on the street. It directed that only the operators or their big dealers who have built up structures as their shops should register SIM cards.
This directive reduces the speed with which many Nigerians buy and register the SIMs. This prevented many of them to add to their GSM lines as it was their practice whenever they experienced frustration with operators of their main lines.
Also, the uncertainty over the fate of 9mobile is giving some of the subscribers in the network a valid reason to drop the line. Reports from the media said 9mobile have had its customers base reduced by about 3m since its debt crisis broke last year.
An executive member of one of the industry’s pressure groups told our reporter that the operators may further lose between 15 and 20m more subscribers in 2018 due to numerous factors, including but not limited to the operators’ reluctance to boost their networks capacities which makes it difficult to reach new areas and improve on already served areas.
“It is sad that the operators are finding it very difficult to expand their network. Because of this most of them have failed to go to many yet-to-be-reached places across the country.
“Many of our customers are dropping their multiple lines and now sticking to only one; not because they are satisfied with that one but because they see no sense in using three, four lines with almost the same erratic services,” the official said.
It was gathered by National Daily that if about 15m subscribers were to be lost again this year, it will cost the operators at least N40bn voice and data revenues, based on monthly average revenue per user for voice calls of N1,220 and N1,500 for data respectively.
The average revenue per user for voice calls has been declining since 2004 from over $15 per month per subscriber to a new low of $4. But in the contrary, data’s has been increasing with monthly average revenue per user of between N1,500 and N2,000.
The Association of Licensed Telecommunications Operators of Nigeria (ALTON) said the decreasing revenue of their members due to decline in subscribers’ base, increase operating cost and intrusion of Over The Top services is of great concern to its members.
ALTON’s Chairman, Engr. Gbenga Adebayo said: “Telcos are losing money due to this trend.”
He said the telecom operators would have to invest a lot to make the networks support the data tsunami, with the required quality of service and numerous innovative services, to make able to survive.
But he said the current data and calls prices in the country might not encourage the operators to do this, if something urgent is not done about it.
“On the top of their infrastructures and customers, they will strive to keep with huge investments, the OTTs are offering contents & applications, using huge amount of telcos bandwidth, collecting revenues but paying nothing to the telco operators and to the government,” he lamented.