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Current Data Tariffs Not Sustainable – Telecoms Operators

Staff Writer:
Nigeria telecoms operators have warned that the current data tariffs are not sustainable unless there is price reform to sustain quality of service and ensure healthy competition.
This is according to a statement Thursday in Lagos signed by the duo; Chairman, Association of Licensed Telecoms Operators of Nigeria (ALTON), Engr. Gbenga Adebayo and Association’s Publicity Secretary, Barr. Damian Udeh. They said “the situation has been compounded by the recent economic challenges characterized by the steep depreciation of the naira, the need to resort to the parallel market and foreign exchange scarcity which have considerably increased the capital and operational cost of providing telecommunications services, thus making current data tariffs unsustainable.”
Nigerian Communications Commission (NCC) commenced extensive consultation with the industry prior to the finalization of the data tariff floor.
They added that NCC intervened to set the data tariff floor in exercise of its statutory responsibility to promote healthy competition by periodically reviewing voice and data tariffs in the industry and ensure the sustainability of the Nigerian telecommunications industry.
“It is within the statutory remit of the NCC for it to make decisive interventions to address the data price concerns which had led to data prices falling to unreasonably low levels with the effect that telecommunications operators were unable to recover the cost of providing data services and reinvest in capacity expansion to accommodate the increased usage arising from lower tariffs,” according to the statement.
Furthermore, ALTON said this situation, if left unaddressed, could result in a sustained deterioration in the quality of data services across all networks and the attendant poor quality of experience for users. In this regard, our members await the conclusion of NCC’s market study when the Commission will be in a position to determine its requisite intervention.
As an Association, we fully understand the public sentiments that would appear to have greeted the announcement of a minimum data tariff being introduced by the NCC. And the Commission has, since yesterday, suspended the implementation of its Determination on the data tariff floor.
“We are aware that the NCC introduced the minimum price for data services to help ensure cost recovery and drive the continued investment in the telecommunications sector necessary for the provision of world-class data services for the overall benefit of the Nigerian subscriber and the Nigerian economy. It is our belief that interventions such as these are in keeping with the NCC’s tradition of implementing customer-centric regulatory initiatives such as the Do-Not-Disturb Service and the Mobile Number Portability Scheme which were introduced to enhance customer satisfaction with telecommunications services.
ALTON also notes that price changes for data services across all networks following any intervention by the NCC are not expected to have a detrimental effect on broadband penetration contrary to some sentiments being expressed in the media. ALTON wishes to emphasise that while it is imperative that telecommunications operators continue to explore opportunities for provide their subscribers with more value for their money, it is important that prices be set at realistic levels which ensure that subscribers are not only able to afford services but that operators are also in a position to provide first-rate Quality of Service to their subscribers.

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