Most Nigerian businesses still favour good old fixed-line telephony despite the profile of the country as home to over 120 million live mobile phone connections, a new research by IDC, the U.S. technology market research company, has shown.[blockquote right=”pull-right” cite=”IDC”]“In fact, 42% of Nigerian enterprises’ outbound voice traffic is conducted via traditional fixed-line telephony, while mobile telephony accounts for 33% of outbound voice traffic and VoIP/private voice networks account for the remaining 25%”[/blockquote]
According to the IDC’s Enterprise Communication Survey businesses in Nigeria prefer to use traditional fixed-line telephony for outbound calls over mobile and even VoIP.

“In fact, 42% of Nigerian enterprises’ outbound voice traffic is conducted via traditional fixed-line telephony, while mobile telephony accounts for 33% of outbound voice traffic and VoIP/private voice networks account for the remaining 25%”, according to the latest insights from IDC’s Annual Enterprise Communication Survey.

While the uptake of machine-to-machine (M2M) technologies is limited in Nigeria, improving data-transfer speeds will play a key role in driving future adoption of the concept, according to the market trend survey report by IDC.

The research shows that only 30% of enterprises in Nigeria have implemented M2M technology in some form or other, with security monitoring, fleet management, and point-of-sale machines now accounting for the majority of M2M connections in Nigeria.

“Advanced M2M applications such as smart metering, pay-as-you-drive-insurance, and intelligence building are not currently widely used in Nigeria, with connectivity issues and the complexities involved in implementing and managing such technologies serving as the key inhibitors.”

IDC believes connectivity will be a major driver for the future adoption of M2M and the Internet of Things (IoT). Indeed, the research and advisory firm’s latest report, ‘M2M, Internet of Things, and Voice Trends and Priorities in Nigeria, 2013: Survey Results’, anticipates strong growth in the M2M/IoT market as data-transfer speeds improve in the country.

IDC said that connectivity in Nigeria is now not very reliable, and even the country’s telecommunications regulatory body, the Nigerian Communications Commission (NCC), has raised concerns about the quality of service levels among operators.

However, with the regulator keen on implementing a national broadband policy, IDC expects voice and data connectivity to improve considerably over the coming years and thereby help greater uptake of more complex M2M/IoT technologies.

“Nigeria is a very price-sensitive market and IDC is of the opinion that the lower tariffs offered by fixed-line operators are the primary motivator for enterprises choosing this particular medium,” says Oluwole Babatope a telecommunications and networking research analyst with IDC West Africa. “However, with unified communications gaining traction in Nigeria, VoIP adoption by businesses is expected to grow because it offers an even cheaper platform for making voice calls. But as with M2M/IoT connections, the growth in VoIP will be inextricably linked to the quality of data connectivity.”

The research showed that Nigerian businesses typically prefer to buy a combination of services from one provider, with one point of contact and one bill. IDC believes this is primarily driven by cost-reduction initiatives. “The preferences exhibited by Nigerian enterprises show that communication service providers enjoy a first-mover advantage when it comes to providing fixed and mobile voice services and data services,” continues Babatope. “IT and hosting services companies, meanwhile, have the edge in providing network services in tandem with IT or cloud services.

“The most important factors influencing the selection of a network provider by Nigerian businesses are pricing and the quality of service and support. Quality of service has been a major challenge for enterprises in Nigeria in recent years, and IDC expects enterprises to increasingly gravitate toward network providers that can demonstrate consistent quality of service and offer price points that match their budgets.”