FG halts plan to hike data prices in Nigeria

The Federal Government today suspended plans by mobile phone companies to hike data tariffs in Nigeria following public outcry.

Tony Ojobo, Director of Public Service at the Nigerian Communications Commission announced this afternoon that the telecoms regulator has halted the planned increase in data prices planned to have started from tomorrow, December 1, 2016. NCC’s Ojobo says adds that “in taking that decision, the smaller operators were exempted from the new price regime, by virtue of their small market share. The decision on the price floor was taken in order to protect the consumers who are at the receiving end and save the smaller operators from predatory services that are likely to suffocate them and push them into extinction.”

The decision to suspend this directive was taken after due consultation with industry stakeholders and the general complaints by Consumers across the country, Ojobo says in a statement sent to Technology Times citing that the nation’s telecoms regulator took the step following “concerns that visited the directive to introduce price floor for data segment of the telecommunications sector beginning from December 1, 2016.”

TheCable had exclusively reported the planned data tariffs increase approved by NCC and to be implemented by the Big Four mobile network operators (MNOs).

[caption id="attachment_53083" align="aligncenter" width="6400"] Connected Nigeria: Mobile phone users seen at the ngNOG 2016 tech event held in Abuja[/caption]

The telecoms regulator has recanted the move and says that status quo should be maintained by the mobile phone companies.

According to Ojobo, “the Commission has weighed all of this and consequently asked all operators to maintain the status quo until the conclusion of study to determine retail prices for broadband and data services in Nigeria.”

According to Ojobo, the MNOs wrote to NCC, “on November 1, 2016 on the determination of an interim price floor for data services after the stakeholder’s consultative meeting of October 19, 2016.”

[caption id="attachment_54348" align="aligncenter" width="8000"] Internet subscribers on Nigeria Mobile GSM networks by October 2016[/caption]

He explains that NCC’s decision on pegging a price floor for data service “was primarily to promote a level playing field for all operators in the industry, encourage small operators and new entrants.”

The price floor in 2014 was N3.11k per MB (megabyte) but was removed in 2015, the regulator says underscoring that the price floor that was supposed to flag off tomorrow was N0.90k per MB.

[caption id="attachment_42427" align="alignleft" width="300"] Mr Tony Ojobo Director of Public Affairs at NCC[/caption]

Ojobo explains further that before the new suspended price floor of N0.90k per MB, the industry average for dominant operators including MTN Nigeria Communications Limited, EMTS Limited (Etisalat Nigeria) and Airtel Nigeria Limited was N0.53k per MB.

Etisalat Nigeria offered N0.94k per MB; Airtel Nigeria offered N0.52k per MB; MTN Nigeria offered N0.45k per MB and Globacom offered N0.21k/MB, the telecoms regulator says.

On the other hand, Ojobo says “the smaller operators/ new entrants” charge the following data rates: Smile Communications, N 0.84k per MB; Spectranet, N 0.58k per MB and NATCOMS (NTEL), N 0.72k per MB.

[caption id="attachment_54346" align="aligncenter" width="8000"] Number of Internet subscribers of Visafone and Multi-Links in Nigeria by October 2016[/caption]

NCC’s Ojobo says adds that “in taking that decision, the smaller operators were exempted from the new price regime, by virtue of their small market share. The decision on the price floor was taken in order to protect the consumers who are at the receiving end and save the smaller operators from predatory services that are likely to suffocate them and push them into extinction.”

According to the telecoms regulatory agency, “the price floor is not an increase in price but a regulatory safeguard put in place by the telecommunications regulator to check anti-competitive practices by dominant operators.”

Ojobo says that NCC statement issued today “clarifies the insinuation in some quarters that the regulator has fixed prices for data services. This is not true because the NCC does not fix prices but provides regulatory guidelines to protect the consumers, deepen investments and safeguard the industry from imminent collapse.”