Here’s some good news coming out of the telecom sector in Nigeria. Earlier today we reported that the Nigerian Communications Commission (NCC) issued a directive to telecom companies to increase the tariff on mobile data from the 1st of December. The Nigerian Senate reportedly asked the commission to stop the planned hike. Some service providers had registered their dissatisfaction with the directive and the Senate asked its communications committee members to meet with these telcos to get their backing as well.
Shortly after the call from the senate asking the NCC to back down, the Public Affairs Director at the NCC Mr. Tony Ojobo released a statement saying;
“The decision to suspend this directive was taken after due consultation with industry stakeholders and the general complaints by Consumers across the country.
“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 him, “the decision to have a price floor 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/MB but was removed in 2015. The price floor that was supposed to flag off on December 1, 2016 was N0.90k/MB.
“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.
There you go, the reason why the directive was put in place in the first place was to provide a level playing field for new companies like ntel to gain some ground. But to respond to those who say the NCC is price fixing in a private sector driven industry, he had the following to say;
“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.
“Before the new suspended price floor of N0.90k/MB, the industry average for dominant operators including MTN Nigeria Communications Limited, EMTS Limited (Etisalat) and Airtel Nigeria Limited was N0.53k/MB.
“Etisalat offered (N0.94k/MB), Airtel (N0.52k/MB), MTN (N0.45k/MB) and Globacom (N0.21k/MB).
The smaller operators/ new entrants charge the following: Smile Communications N0.84k/MB, Spectranet N0.58k /MB and NATCOMS (NTEL) N0.72k/MB.
“The NCC as a responsive agency of government takes into consideration the feelings of the consumers and so decided to suspend the new price floor,” the statement read.
So in light of this, there will be no price hike tomorrow which means 1,000 Naira can still get you 1.5GB of data. If the NCC was protecting newer entrants though, it could have done so when companies like Glo and Etisalat entered the market. It was the competition they faced that made Glo come up with the per-second billing which many Nigerians embraced. The rest as they say is history.