The GSM Association (GSMA) has revealed that Nigeria requires an estimated $360 million investment to achieve 98% 4G coverage across the country’s geographical space.

This call for expansion comes when Nigeria is accelerating its rollout of 5G services, which has seen remarkable growth over the past 18 months.

The GSMA’s “2024 Year in Review” report for Sub-Saharan Africa highlights the progress and challenges in Nigeria’s telecom sector, focusing on the dual need for 4G expansion and the growing adoption of 5G.

Nigeria’s 4G network coverage has made significant strides, growing from 41% in 2019 to 84% in 2024, according to the GSMA. However, rural areas remain underserved, with only 48% coverage, leaving millions without access to reliable high-speed connectivity.

“While urban areas have achieved near-complete 4G coverage, rural regions face significant connectivity gaps. An estimated $360 million investment is required to extend 4G coverage to 98% of Nigeria’s geographical space,” the GSMA stated.

For the remaining 2% of the population in remote and sparsely populated areas, alternative technologies like satellite-based connectivity may be the most feasible solution.

Policy Reforms to Reduce Investment Gap

The GSMA emphasized the need for policy reforms to close the investment gap. Sector-specific taxation on telecom infrastructure and retail price regulations increase costs, limiting private sector investments. The report suggests that removing these barriers could reduce the investment gap by 44%, bringing it down to $200 million.

Additionally, policies to improve 4G device affordability and access, enhance telecom infrastructure security, and eliminate Right of Way (RoW) fees are critical to accelerating 4G adoption.

“If the policy reforms recommended in this report are adopted collectively, they could significantly accelerate mobile broadband adoption in Nigeria by 2030,” the GSMA noted.

Nigeria’s Rapid 5G Expansion

The push to expand 4G coverage is taking place as Nigeria makes impressive progress in rolling out 5G services, which promise faster speeds, lower latency, and broader connectivity.

According to Speedtest Intelligence, 5G service availability—a geospatial measure of the percentage of an operator’s known locations with 5G service—increased from 17.2% in Q1 2023 to 35.7% in Q2 2024.

MTN Nigeria was the first to launch 5G in September 2022, initially offering services in select parts of Lagos. By May 2023, the telecom giant had installed 700 5G sites across 13 cities. Airtel Nigeria followed suit in June 2023, rolling out its commercial 5G services.

By the end of 2023, Nigeria had approximately 2.3 million 5G subscribers, accounting for 1.04% of the country’s total active mobile subscribers. As 5G infrastructure continues to expand, this figure is expected to grow significantly.

Bridging the Connectivity Divide

Despite the growing adoption of 5G in urban centers, the GSMA warns that focusing solely on advanced technologies risks widening the digital divide. Many rural areas still lack access to 4G, highlighting the need for parallel investments to ensure inclusive connectivity.

The Nigerian government has shown commitment to addressing these challenges. Minister of Communications, Innovation, and Digital Economy, Dr. Bosun Tijani, recently emphasized the importance of declaring telecom infrastructure as critical national infrastructure.

“The private sector typically invests in areas with economic activity and population density, but the government recognizes the need to invest in underserved areas to ensure inclusivity,” Tijani stated.

The government has also set quality benchmarks for telecom services and invested in infrastructure to complement private sector efforts. These initiatives aim to create a more enabling environment for telecom operators to expand 4G and 5G networks.

Economists have noted that for Nigeria to achieve its digital economic goals, nationwide 4G coverage is crucial. It is also a step to ensure that the benefits of connectivity reach every corner of the country.

However, some analysts believe that the rapid expansion of 5G underscores the country’s commitment to staying at the forefront of global telecom advancements. They note that with the right policy reforms, strategic investments, and collaboration between the public and private sectors, Nigeria can bridge its connectivity gaps and achieve a digitally inclusive future, unlocking immense economic and social benefits for its population.

The Nigerian telcos got a great new year present even as the Nigeria Labour Congress condemned the 50% hike “The Nigeria Labour Congress (NLC) has fiercely condemned the recent 50% tariff hike approved by the Nigerian Communications Commission (NCC) for telecommunications operators, calling it an “assault on the welfare of Nigerians.”’

But no matter how you see it, the telcos deserve this increase because those equipment are not fabricated in Umuahia, Sokoto, Jos or Ibadan. Yes, they are imported into Nigeria with USD dollars, and not Naira. With the fading of Naira, this recalibration makes sense! Sure, expect court cases as many will disagree with me.

But this price hike will not end with the telcos; expect online streamers, cinemas, and everyone to “top and collect”, because that is where things are right now. Nigeria’s Federal Competition and Consumer Protection Commission (FCCPC)  is aligned that prices should increase, even though it expects the companies to offer improved services. Lol.

NCC which sees the operating logs and books of these companies saw the increase as a ‘The NCC, in its defense, described the hike as a “rationalized adjustment” meant to address the surging operational costs faced by telecom operators due to inflation, foreign exchange volatility, and insecurity. It argued that the 50% increase was more measured than the over 100% initially proposed by operators.’

And there lies the confession I was expecting because a bird which flies from the ground only to perch on the ant-hill is still very much on the ground. The federal government of Nigeria is no longer absorbing subsidy costs, foreign exchange costs, etc, but that does not mean those costs have gone. Do you know what happened? The costs moved from the public purses to corporate purses, and after adjustments, those companies will ask you to pay up!

Yes, these costs cannot be eliminated by moving them from the government to companies. You only take them out by providing practical alternatives or substitutes. Otherwise, nothing is changing. In short, it is even more effective if the government absorbs these costs as it could be more optimized unlike where companies are applying the rules in any way they like. As the debate continues, MTN, Glo, Airtel, etc don top and collect? And if you sell things, you dey top and collect also. Now, you know who is paying for subsidies!