MTN, Glo, Airtel, 9Mobilie propose hike in tariff, write NCC

(Nigeria) Telecommunications Service Providers in the country have announced plans to increase the cost of calls, SMS, and data by 40 percent.

This is coming, despite the huge profits declared by the telcos last year.

Association of Licensed Telecommunication, ALTON, in a letter to the Nigerian Communications Commission, NCC , on Wednesday, entitled "Impact of the Economic and Security Issues on the Telecommunications Sector," attributed  the proposed tariff hike to the rising cost of running a business in the nation.

The umbrella body for telecom companies including MTN, Glo, Airtel and 9Mobilie, while proposing the increase in calls and data rates, added that to further help telcos during this economic crisis, the commission should explore and provide other means of penalising operators rather than punitive monetary sanctions; extend the payment timeline of relevant regulatory levies and fees; prevail on the Federal Government to sign the executive order declaring telecoms infrastructure as a critical national infrastructure to mitigate cost spent replacing damaged and stolen infrastructures, among other things.

The read:  “As the commission may be aware, the power sector under the supervision of its Nigerian Electricity Regulatory Commission of the power sector in November 2020 undertook a review of electricity tariffs to cater for the economic headwinds reported above.

“In view of the foregoing, ALTON considers it expedient for the telecommunications sector to undergo periodic cost adjustments through the commission’s intervention in order to minimise the impact of the challenging economic issues faced by our members. Details are hereunder.

“Upward review of the price determination for voice and data and SMS. Given the state of the economy and the circa 40% increase in the cost of doing business, we wish to request for an interim administrative review of the mobile (voice) termination rate for voice; administrative data floor price, and cost of SMS as reflected in extant instruments.

“With respect to voice an SMS cost, ALTON respectfully requests the commission to consider a mark-up approach to address the upward price adjustment desirable for the industry. We have enclosed herein and marked as ‘Annexure 1’our proposal in that regard.

For data services, we wish to request that the commission implements the recommendations in the August 2020 KPMG report on the determination of cost-based pricing for wholesale and retail broadband service in Nigeria. Excerpts from the report, are attached and marked ‘Annexure 2’ to provide a further illustration.

“In implementing the said recommendations, however, we recommend that the 40% increase in the cost of doing business be factored in to arrive at a cost price per GB in view of the current economic situation."

“For large operators, new interim MTR of N5.46 from N3.90 reflecting 40% increase in the cost of business.

"For small operators, new interim MTR of N6.58 from N4.70 reflecting 40% increase in the cost of business.”