The Federal Government of Nigeria announced today that it has succeeded in slashing the cost of internet data by 50%, a development which has seen the cost of 1GB data reduced from N1,000 to less than N500.
The announcement was made by the Minister of Communications and Digital Economy, Dr. Isa Ibrahim Pantami, who said the development was in line with the directive he gave to the regulatory agency (NCC) to put measures in place to reduce the average cost of data in the country.
“The average cost of 1GB of data has reduced from the January 2020 cost of N1,000 to N487.18 in November, 2020.
“This was based on a report by the Nigerian Communications Commission (NCC) submitted to the Honourable Minister following the implementation of the directives,” Dr Pantami’s Technical Assistant, Mr Femi Adeluyi said in a statement issued on Thursday in Abuja.
He explained that “the Honourable Minister had inaugurated a Committee that developed the Nigerian National Broadband Plan (2020-2025) on the 16th of December, 2019. The Plan was unveiled and launched by His Excellency, President Muhammadu Buhari, GCFR, on the 19th of March, 2020.
“One of the goals of the Plan is to reduce the average cost of 1GB of data to a maximum of N390 by 2025.
“With the January 2020 baseline of N1,000 per GB, the maximum projected steady decrease for the end of each year was as follows: 2020 (N925), 2021 (N850), 2022 (N775), 2023 (N700), 2024 (N545) and 2025 (N390).
“In line with Dr Pantami’s commitment to under promise and over deliver, the measures have caused the current cost of data to reduce significantly beyond the December 2020 projection of N925.
“Based on the Report by NCC, the average cost of data as at November 2020 was N487.18, which amounts to 47.33% lower than the projected value.
“The Report also indicates that the cost of data in November 2020 was less than 50% of the cost of data in January 2020.
“The Federal Ministry of Communications and Digital Economy, through the NCC, will continue to ensure that consumers enjoy a price regime that supports fairness and is friendly to consumers.
“Policies are in place to ensure that operators adopt competitive pricing that eschews unjustifiable margins. The general public may also wish to note that complaints about rapid data depletion are also being investigated.
“For more enquiries, the Honourable Minister has directed NCC to respond to all issues raised by our citizens and customers.
“All hands will remain on deck to achieve the goals of the Broadband Plan as the Ministry supervises its implementation in line with our National Digital Economy Policy for a Digital Nigeria.”
The cost of broadband has been a big issue in the African internet space, especially in Nigeria that commands the largest telecom market in the continent. Consequently, Dr. Pantami had rolled out a digital roadmap, which was endorsed earlier in the year by Buhari, to address the challenge.
However, while the directive has resulted in celebration among internet users, experts believe it questions the government’s commitment to a free and competitive market, where market forces, rather than regulators, should determine the cost of commodities.
In July, South African satellite Television, DStv Multichoice was ordered by the Nigerian House of Representatives to slash the cost of subscription or develop pay per watch model as Nigerians lament that the cost was becoming unaffordable.
A month earlier, DStv had increased the subscription charges, citing forex situation and business-unfriendliness of the environment that keep adding to the rising cost of doing business in Nigeria.
However, the chairman of the House Ad-hoc Committee on broadcasting, Unyime Idem said the increased charges are unacceptable in the face of COVID-19 pandemic and ordered DSTV to halt every plan they have for increment until further notice.
The faceoff pushed DStv to drop its chase for football TV rights and concentrate on streaming.
While it is evident that Africa has the most expensive data cost, infrastructural decay and poor business policies by the government have been fingered as the reasons; and there have been little or no efforts by various African governments to address the deficiencies.
Experts are worried that constant government’s interference with pricing will not only hinder the market’s competitiveness, but will also spook potential investors who are contemplating the Nigerian market.