Why Data Price Reduction In Nigeria May Not be Possible

Why Data Price Reduction In Nigeria May Not be Possible

The Minister of Communication and Digital Economy, Dr. Isa Ali Pantami, on Tuesday, reiterated Federal Government’s resolve to bring the cost of data down. He said his office has been flooded with complaints by consumers who decry the high cost of data and other sharp practices by network operators.

Read: Why Telecom Consumers Experience Early Data Depletion.

He therefore directed Nigerian Communication Commission (NCC), to work out modalities with network service providers and other stakeholders to see that the cost of data is reviewed downward.

“I am urging the management of NCC to work towards reducing the price of data in Nigeria. It is too costly and people are complaining every day.

“If you go to other countries, even countries that are not as largely populated as Nigeria, data prices are not this high.

“I am also a victim of some of the infractions that are so common in the industry. You load your data, but you barely used 20 percent of it and the entire data is wiped off.” The Minister said.

The issue of data price reduction has dragged on for some time now, and the Minister of Communication is no longer having any of it. He therefore issued 5 days ultimatum the Commission to put the saga to rest.

“The last time I commented on the issue of illegal data deduction… this is one of the issues that worry me badly today. Engr. Wakil was making a presentation on behalf of the Executive Vice Chairman, he tried to defend operators on one hand and the commission on the other, but I was not fully convinced with the explanation.

“Please go, sit down and review that issue. It is very important and I want to get your feedback with that report in the next five working days with the decision on it because the complaint from Nigerians are beyond what I can handle, as it is today, people are complaining.” He added.

Reacting to the marching order, the Chairman of ALTON, Engr. Gbenga Adebayo, told Daily Trust: “I don’t know how the government is going to achieve that data reduction in five days. Have they put into consideration the high cost of operating our businesses and the very harsh operating environment we are in”? He asked

“Why are they trying to muzzle the NCC and stampede it into doing what is unrealistic? Do they know that operators don’t just sit down and fix tariffs? They, with NCC rely on so many things before coming up with tariffs.

“We do not know under what circumstances the directive was given, and to be honest with you, we don’t know how that is going to be achieved. We have said it several times that when policies interfere with commercial matters, the industry will be jeopardized. Government needs to be careful not to whittle down the powers of the regulator.

“To arrive at prices, NCC normally conducts survey and research, and after all that, it will benchmark the country’s tariffs based on what is obtained in other jurisdictions,” he said.

The Cable UK’s Data figures compared according to regions in Africa varies in prices. In West Africa, Nigeria network operators sell 1GB for about $3.22 while you get the same amount of data in Chad for $23.3. In Cameroon it’s way cheaper at $1.7 while in Ivory Coast it costs $4.1 and $2.92 in Niger Republic.

In North Africa, 1GB can be obtain countries like Algeria, 1GB is sold for $5.15, Egypt $1.49, Libya, $4.87 and Sudan $0.6.

While in Southern Africa, 1GB goes for $11.2 in Namibia, $14.12 in Botswana and $7.19 in South Africa.

These varying figures show that there is no formula to determine the cost of data but each country uses infrastructure and market forces to determine the cost. And when it comes to infrastructure, Nigeria like many other African countries is way behind – a recipe for high cost of data.

For instance, the cost of fueling the generators powering network service masts in Nigeria is enough to influence the cost of data. And there is issue of vandalism that has become a norm that the operators are helplessly dealing with. And there is also the issue of Right of Way (ROW) that the Minister of communication himself acknowledged.

The NCC knows that these challenges exist and cannot force telcos to reduce the cost of data when the problems instigating it have not been fixed. That would be tantamount to forcing them to operate on loss which will have its own adverse effects.

The Ministry of Communication has a good intention by directing the NCC to protect the interest of subscribers, but it shouldn’t be at all cost because the interest of telcos needs to be protected too. Although the errors of telcos have become too many that they seem inexcusable, Dr. Pantimi acknowledged that they need help too:

“The way we pursue the mobile operators to do what is right, we should also protect their interest and resolve the challenges they face,” he said.

Providing them with the needed infrastructure will reduce the cost of operation and in turn, the cost of calls and data. So the federal government should play their role by providing basic infrastructure like electricity and security, and then watch market forces reduce the cost of telecommunication. If it doesn’t happen, then there will be basis for government to act on behalf of the people.

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